The Zweig Fund, Inc.
The Zweig Total Return Fund, Inc.
900 Third Avenue, New York, New York 10022
April 3, 2008
DEAR SHAREHOLDER:
You are cordially invited to attend the Joint Annual Meeting of Shareholders
of The Zweig Fund, Inc. ("ZF") and The Zweig Total Return Fund, Inc. ("ZTR")
(collectively, the "Funds") to be held on Tuesday, May 6, 2008, at 10:00 A.M.
at the offices of Katten Muchin Rosenman LLP, located at 575 Madison Avenue
(between 56th and 57th Streets), 11th Floor, New York, New York.
Details of the business to be presented at the meeting can be found in the
accompanying Notice of Annual Meeting and Proxy Statement. This meeting will
give you an opportunity to hear a report on the Funds and to discuss other
matters of interest to you as a shareholder.
We hope that you will be able to attend the meeting. Whether or not you plan
to attend, please complete, date, sign and mail the enclosed proxy card or
cards to assure that your shares are represented at the meeting. Please return
all proxy cards that you may receive from the Funds.
On behalf of the Boards of Directors of ZF and ZTR, I extend our
appreciation for your continued support.
GEORGE R. AYLWARD,
Chairman of the Board and President of
The Zweig Fund, Inc.
The Zweig Total Return Fund, Inc.
The Boards of Directors of ZF and ZTR unanimously recommend that shareholders
vote:
FOR the two nominees for election as Directors.
The Zweig Fund, Inc.
The Zweig Total Return Fund, Inc.
900 Third Avenue, New York, New York 10022
-----------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
MAY 6, 2008
-----------------
TO THE SHAREHOLDERS:
This Joint Proxy Statement is furnished in connection with the solicitation
of proxies on behalf of the Boards of Directors of The Zweig Fund, Inc., a
Maryland corporation ("ZF"), and The Zweig Total Return Fund, Inc., a Maryland
corporation ("ZTR"), for use at the Joint Annual Meeting of Shareholders to be
held at the offices of Katten Muchin Rosenman LLP, located at 575 Madison
Avenue (between 56th and 57th Streets), 11th Floor, New York, New York, on
Tuesday, May 6, 2008 at 10:00 A.M. and at any and all adjournments or
postponements thereof (the "Meeting") for the following purposes:
1. ELECT DIRECTORS:
. With respect to ZF, to elect two Directors to serve until the Annual
Meeting of Shareholders in 2011 and until their successors are
elected and duly qualify.
. With respect to ZTR, to elect two Directors to serve until the Annual
Meeting of Shareholders in 2011 and until their successors are
elected and duly qualify.
2. OTHER BUSINESS:
To transact such other business as may properly come before the
Meeting.
Shareholders of record of ZF and/or ZTR at the close of business on
March 11, 2008 are entitled to notice of, and will be entitled to vote at, the
Meeting. The enclosed Proxy is being solicited on behalf of the Board of
Directors.
By Order of the Boards of Directors of
The Zweig Fund, Inc. and
The Zweig Total Return Fund, Inc.
GEORGE R. AYLWARD,
Chairman of the Board and President
New York, New York
April 3, 2008
IMPORTANT:
You are invited to attend the Meeting. Whether or not you plan to attend the
Meeting in person, you are requested to complete, date and sign the enclosed
proxy card(s) and return it promptly in the envelope provided, which is
addressed for your convenience to each Fund of which you are a shareholder
and requires no postage if mailed in the United States. Your prompt return of
the enclosed proxy card may save the Funds the necessity and expense of
further solicitations to assure a quorum at the Meeting. A Proxy will not be
required for admission to the Meeting.
The Zweig Fund, Inc.
The Zweig Total Return Fund, Inc.
900 Third Avenue, New York, New York 10022
-----------------
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
MAY 6, 2008
-----------------
This Joint Proxy Statement is furnished in connection with the solicitation
of proxies on behalf of the Boards of Directors of The Zweig Fund, Inc., a
Maryland corporation ("ZF"), and The Zweig Total Return Fund, Inc., a Maryland
corporation ("ZTR"), for use at the Joint Annual Meeting of Shareholders to be
held at 575 Madison Avenue (between 56th and 57th Streets), 11th Floor, New
York, New York, on Tuesday, May 6, 2008 at 10:00 A.M., and at any and all
adjournments or postponements thereof (the "Meeting"), for the purposes set
forth in the accompanying Notice of Annual Meeting dated April 3, 2008.
The Meeting is scheduled as a joint meeting of the respective shareholders
of ZF and ZTR (the "Funds") because the shareholders of both Funds are expected
to consider and vote on a similar proposal with respect to the election of
Directors. The Boards of Directors of the Funds have determined that the use of
a joint proxy statement for the Meeting is in the best interest of the
shareholders of both Funds. In the event that any shareholder of a Fund present
at the Meeting objects to the holding of a joint meeting and moves for
adjournment of such Fund's meeting to immediately after the Meeting, so that
such Fund's meeting may be held separately, the persons named as proxies will
vote in favor of such adjournment. Shareholders of each Fund will vote
separately on the proposal relating to their respective Fund, and an
unfavorable vote on a proposal by the shareholders of one Fund will not affect
the implementation by the other Fund of such proposal if the shareholders of
such other Fund approve the proposal.
If the accompanying form of proxy is properly executed and returned in time
to be voted at the Meeting, the shares will be voted in accordance with the
instructions marked by the shareholder. Executed ZF proxies that are unmarked
will be voted for the election of the two nominees of the ZF Board of Directors
as Directors of ZF. Executed ZTR proxies that are unmarked will be voted for
the election of the two nominees of the ZTR Board of Directors as Directors of
ZTR. A shareholder can revoke the proxy prior to its use by appearing at the
1
Meeting and voting in person, by giving written notice of such revocation to
the Secretary of the respective Fund prior to the Meeting, or by returning a
subsequently dated proxy prior to the Meeting.
The Board of Directors of each Fund has fixed the close of business on
March 11, 2008 as the record date for the determination of shareholders of that
Fund entitled to notice of and to vote at the Meeting. This Proxy Statement and
the accompanying form of proxy will be first sent to shareholders on or about
April 3, 2008.
As of the record date, 91,955,558 shares of ZF's common stock were
outstanding, and 114,594,744 shares of ZTR's common stock were outstanding. To
the best of each Fund's knowledge, no person beneficially owns more than five
percent of the outstanding shares of that Fund's common stock.
The annual report of each Fund for the year ended December 31, 2007,
including financial statements, has been mailed to shareholders of record of
that Fund at the close of business on that date, and to persons who became
shareholders of record between that time and the close of business on March 11,
2008.
Each Fund will furnish, without charge, a copy of the Fund's December 31,
2007 Annual Report to any shareholder who requests it by contacting the Fund's
Administrator, Phoenix Equity Planning Corporation, 56 Prospect Street, P.O.
Box 150480, Hartford, Connecticut 06115-0480, Attention: Shareholder Services;
Toll-free telephone number 1-800-272-2700.
PROPOSAL 1
ELECTION OF DIRECTORS
The members of the Board of Directors of ZF and ZTR are divided into three
classes, with the term of office of one class expiring each year. At the
forthcoming Annual Meeting, two ZF and two ZTR Directors will be elected to
serve a three-year term (until the third succeeding Annual Meeting in 2011 and
until their successors are elected and duly qualify). Unless authority to vote
for the election of Directors is withheld, the enclosed proxy will be voted for
the election of the nominees named below, who have indicated their intention to
serve if elected. While management has no reason to believe that the nominees
will not be available as candidates, should such a situation arise, proxies may
be voted for the election of such other persons as a Director as the holders of
the proxies may, in their discretion, determine.
Each Fund's Board of Directors has appointed a Nominating Committee which
makes annual recommendations as to the individuals to be nominated by the
Fund's Board of Directors for election as Directors at the forthcoming Annual
Meeting and recommends to the
2
Board candidates for election by the Board of Directors to fill any vacancies
in the Board of Directors, including those resulting from an increase in the
number of Directors. Each Fund's Nominating Committee consists of three
Directors who are not "interested persons" (as defined in the Investment
Company Act of 1940, as amended (the "Act")) of the Fund, Phoenix/Zweig
Advisers LLC, the Funds' investment adviser (the "Adviser") or Zweig Consulting
LLC (the "Sub-Adviser").
Based on the recommendations made by ZF's Nominating Committee at its
meeting held on February 12, 2008, the Board of Directors of ZF has nominated
Wendy Luscombe and R. Keith Walton, who are presently Directors of ZF, for
re-election to the ZF Board, to serve until the third succeeding Annual Meeting
in 2011 and until their successors are elected and duly qualify. Based on the
recommendations made by ZTR's Nominating Committee at its meeting held on
February 12, 2008, the Board of Directors of ZTR has nominated Wendy Luscombe
and R. Keith Walton, who are presently Directors of ZTR, for re-election to the
ZTR Board, to serve until the third succeeding Annual Meeting in 2011 and until
their successors are elected and duly qualify.
Background information with respect to the current Directors appears below.
Unless otherwise noted, the address of each individual is 900 Third Avenue,
New York, NY 10022.
Number of
Portfolios in Principal
Name, Address, Term of Fund Occupation(s)
Age and Office and Complex During Past 5 Years
Position(s) Length of Overseen by and Other
with Funds Time Served Director Directorships Held
--------------------------------------------------------------------------
DISINTERESTED DIRECTORS
--------------------------------------------------------------------------
Charles H. Brunie Term: Until 2 Chairman, Brunie
YOB: 1930 2009. Served Associates (investments)
Director since: 1998 for (since April 2001);
ZF and 1988 Oppenheimer Capital
for ZTR. (1969-2000), Chairman
(1980-1990), Chairman
Emeritus (1990-2000);
Chairman Emeritus, Board
of Trustees, Manhattan
Institute (since 1990);
Trustee, Milton and Rose
D. Friedman Foundation for
Vouchers (since 1999);
Trustee, Hudson Institute
(since 2002); Chairman of
the Board, American
Spectator (since 2002);
Chartered Financial
Analyst (since 1969).
--------------------------------------------------------------------------
3
Number of
Portfolios in Principal
Name, Address, Term of Fund Occupation(s)
Age and Office and Complex During Past 5 Years
Position(s) Length of Overseen by and Other
with Funds Time Served Director Directorships Held
------------------------------------------------------------------------
Wendy Luscombe Term: Until 2 Co-lead Independent
YOB: 1951 2008. Served Director of The Zweig Total
Director since: 2002 for Return Fund, Inc. and of
ZF and ZTR. The Zweig Fund, Inc. (since
2006); Principal, WKL
Associates, Inc. (private
investor and consultant)
(since 1994); Fellow, Royal
Institution of Chartered
Surveyors; Member,
Chartered Institute of
Arbitrators; Director,
Endeavour Real Estate
Securities, Ltd. REIT
Mutual Fund (2000-2005);
Director, PXRE, Corp.
(reinsurance) (1994-2007);
Member and Chairman of
Management Oversight
Committee, Deutsche Bank
Real Estate Opportunity
Fund 1A and 1B (since
2003); Trustee, Acadia
Realty Trust (since 2004);
Member of National
Association of Corporate
Directors Teaching Facility
(since 2007).
------------------------------------------------------------------------
Alden C. Olson Term: Until 2 Chairman of the Audit
YOB: 1928 2010. Served Committee of The Zweig
Director since: 1996 for Total Return Fund, Inc. and
ZF and ZTR. of The Zweig Fund, Inc.;
Currently retired;
Chartered Financial
Analyst (since 1964);
Professor of Financial
Management, Investments
at Michigan State
University (1959 to 1990).
------------------------------------------------------------------------
4
Number of
Portfolios in Principal
Name, Address, Term of Fund Occupation(s)
Age and Office and Complex During Past 5 Years
Position(s) Length of Overseen by and Other
with Funds Time Served Director Directorships Held
-------------------------------------------------------------------------------
James B. Rogers, Jr. Term: Until 2 Private investor (since
YOB: 1942 2009. Served 1980); Chairman, Beeland
Director since: 1986 for Interests (Media and
ZF and 1988 Investments) (since 1980);
for ZTR. Regular Commentator on
Fox News (2002-2007);
Author of "Investment
Biker: On the Road with
Jim Rogers" (1994),
"Adventure Capitalist"
(2003), "Hot Commodities"
(2004); and "A BULL IN
CHINA" (2007); Director,
Levco Series Trust (1996-
2006).
-------------------------------------------------------------------------------
R. Keith Walton Term: Until 2 Co-lead Independent
YOB: 1964 2008. Served Director of The Zweig Total
Director since: 2004 for Return Fund, Inc. and of
ZF and ZTR. The Zweig Fund, Inc. (since
2006); Principal and Chief
Administrative Officer,
Global Infrastructure
Partners (since 2007);
Director, Blue Crest Capital
Management Funds (since
2006); Executive Vice
President and Secretary
(1996-2007) of the
University at Columbia
University; Director (since
2002), Member, Executive
Committee (since 2002),
Chair, Audit Committee
(since 2003), Apollo Theater
Foundation, Inc.; Director,
Orchestra of St. Luke's
(since 2000); Vice President
and Trustee, The Trinity
Episcopal School
Corporation (since 2003);
Member (since 1997),
Nominating and
Governance Committee
Board of Directors (since
2004), Council on Foreign
Relations.
5
Number of
Portfolios in Principal
Name, Address, Term of Fund Occupation(s)
Age and Office and Complex During Past 5 Years
Position(s) Length of Overseen by and Other
with Funds Time Served Director Directorships Held
------------------------------------------------------------------------------
INTERESTED DIRECTOR*
------------------------------------------------------------------------------
George R. Aylward Term: Until 2 Senior Executive Vice
56 Prospect Street 2010. Served President and President,
Hartford, CT 06115 since: 2006 for Asset Management (since
YOB: 1964 ZF and ZTR. 2007), Senior Vice President
and President, Asset
Director, Chairman Management (since 2007),
of the Board and Senior Vice President and
President Chief Operating Officer,
Asset Management (2004-
2007); Vice President (2001-
2004), The Phoenix
Companies, Inc.; Director
and President (2006-
present), Chief Operating
Officer (2004-present),
Executive Vice President
(2004-2006), Vice President,
Finance (2001-2002),
Phoenix Investment
Partners, Ltd.; Various
senior officer and
directorship positions with
Phoenix affiliates; President
(2006-present), Executive
Vice President, (2004-2006),
the Phoenix Funds Family;
Chairman, President and
Chief Executive Officer, The
Zweig Fund, Inc. and The
Zweig Total Return Fund,
Inc. (2006-present).
------------------------------------------------------------------------------
Position(s) with
the Funds and Principal Occupation(s)
Name, Address Length of During Past 5 Years and
and Age Time Served Other Directorships Held
-----------------------------------------------------------------------
OFFICERS WHO ARE NOT DIRECTORS**
-----------------------------------------------------------------------
Carlton Neel Executive Vice Senior Vice President and Portfolio
YOB: 1967 President since: 2003 Manager, Phoenix/Zweig Advisers
for ZF and ZTR. LLC (since 2003); Managing
Director and Co-Founder, Shelter
Rock Capital Partners, LP
(2002-2003); Senior Vice President
and Portfolio Manager, Phoenix/
Zweig Advisers LLC (1995-2002);
Vice President, JP Morgan & Co.
(1990-1995).
-----------------------------------------------------------------------
6
Position(s) with
the Funds and Principal Occupation(s)
Name, Address Length of During Past 5 Years and
and Age Time Served Other Directorships Held
-----------------------------------------------------------------------------
David Dickerson Senior Vice President Senior Vice President and Portfolio
YOB: 1967 since: 2003 for ZF Manager, Phoenix/Zweig Advisers
and ZTR. LLC (since 2003); Managing Director
and Co-Founder, Shelter Rock
Capital Partners, LP (2002-2003);
Vice President and Portfolio
Manager, Phoenix/Zweig Advisers
LLC (1993-2002).
-----------------------------------------------------------------------------
Marc Baltuch Vice President and Chief Compliance Officer of Phoenix/
YOB: 1945 Chief Compliance Zweig Advisers LLC (since 2004);
Officer since: 2004 President and Director of Watermark
for ZF and ZTR. Securities, Inc. (since 1991);
Secretary of Phoenix-Zweig Trust
(1989-2003); Secretary of Phoenix-
Euclid Market Neutral Fund (1998-
2002); Assistant Secretary of Gotham
Advisors, Inc. (1990-2005); Chief
Compliance Officer of the Zweig
Companies (since 1989) and of the
Phoenix Funds Complex (since 2004).
-----------------------------------------------------------------------------
Kevin J. Carr Secretary and Chief Vice President and Counsel, Phoenix
One American Row Legal Officer Life Insurance Company (since 2005);
Hartford, CT 06102 since: 2005 for ZF Vice President, Counsel, Chief Legal
YOB: 1954 and ZTR. Officer and Secretary, certain Funds
within Phoenix Fund Complex (since
2005); Compliance Officer of
Investments and Counsel, Travelers
Life and Annuity Company (January
2005-May 2005); Assistant General
Counsel, The Hartford Financial
Services Group (1999-2005).
-----------------------------------------------------------------------------
Moshe Luchins Vice President Associate Counsel (1996-2005),
YOB: 1971 since: 2004 for ZF Associate General Counsel (since
and ZTR. 2006) of the Zweig Companies.
-----------------------------------------------------------------------------
Nancy Curtiss Treasurer Vice President, Head of Operations,
56 Prospect Street since: 2003 for ZF Phoenix Investment Partners (since
Hartford, CT 06115 and ZTR. 2007); Vice President, Operations
YOB: 1952 (2003-2007); Vice President, Fund
Accounting (1994-2003), Treasurer
(1996-2003); Phoenix Equity
Planning Corporation. Treasurer,
multiple funds in the Phoenix Fund
Complex (1994-2006).
-----------------------------------------------------------------------------
7
Position(s) with
the Funds and Principal Occupation(s)
Name, Address Length of During Past 5 Years and
and Age Time Served Other Directorships Held
-----------------------------------------------------------------------------
Jacqueline Porter Vice President and Assistant Vice President, Fund
56 Prospect Street Assistant Treasurer Administration and Tax, Phoenix
Hartford, CT 06115 since: 2006 for ZF and Equity Planning Corporation (since
YOB: 1958 ZTR. 1995); Vice President and Assistant
Treasurer, multiple funds in the
Phoenix Fund Complex (since 1995).
-----------------------------------------------------------------------------
--------
* Director considered to be an "interested person," as that term is defined in
the Act. George R. Aylward is considered an interested person because, among
other things, he is an officer of the Funds.
** The Term of each Officer expires immediately following the 2008 Annual
Meeting of Shareholders. The Board considers reappointments annually.
Compensation of Directors and Officers
During the year ended December 31, 2007, ZF paid Directors' fees aggregating
$137,000 and ZTR paid Directors' fees aggregating $129,500 to the Directors who
were not interested persons of the Funds or the Adviser. For the year ended
December 31, 2007, each Fund paid each Director who is not an interested person
of such Fund or the Adviser an annual fee of $10,000 and a fee of $1,500 for
attendance at each meeting of the Board of Directors or a committee of the
Board. Effective January 1, 2008, each Fund pays each Director who is not an
interested person of such Fund or the Adviser an annual fee of $11,000 and a
fee of $1,500 for attendance at each meeting of the Board of Directors or a
committee of the Board. In addition, as of January 1, 2008, each Fund pays its
Audit Committee Chairman a $10,000 annual retainer. Each Fund also reimburses
its Directors for their actual out-of-pocket expenses relating to attendance at
such meetings.
Set forth below is the compensation paid by ZF and ZTR to current Directors
for the year ended December 31, 2007. The Funds do not pay any pension or
retirement benefits to their Directors.
COMPENSATION TABLE
Pension or Total
Retirement Estimated Compensation
Aggregate Benefits as Annual From the
Compensation Part of Benefits Fund and Fund
Name of Person, From the Fund Upon Complex Paid
Position Fund Expenses Retirement to Directors
----------------------------------------------------------------------
Charles H. Brunie -- ZF-$20,500 $0 $0 $41,000
Director ZTR-$20,500
----------------------------------------------------------------------
Wendy Luscombe -- ZF-$37,000 $0 $0 $71,000
Director ZTR-$34,000
----------------------------------------------------------------------
Alden C. Olson -- ZF-$22,000 $0 $0 $42,500
Director ZTR-$20,500
----------------------------------------------------------------------
8
Pension or Total
Retirement Estimated Compensation
Aggregate Benefits as Annual From the
Compensation Part of Benefits Fund and Fund
Name of Person, From the Fund Upon Complex Paid
Position Fund Expenses Retirement to Directors
-------------------------------------------------------------------------
James B. Rogers, Jr. -- ZF-$20,500 $0 $0 $41,000
Director ZTR-$20,500
-------------------------------------------------------------------------
R. Keith Walton -- ZF-$37,000 $0 $0 $71,000
Director ZTR-$34,000
-------------------------------------------------------------------------
George R. Aylward -- ZF-$0 $0 $0 $0
Interested Director ZTR-$0
and President
Director Ownership of Securities
Set forth in the table below is the dollar range of equity securities of the
Funds owned by each Director as of December 31, 2007.
Aggregate Dollar Range of
Fund Ownership in all
Dollar Range Funds Overseen by
of Equity Securities Director in Family of
Name of Director in the Fund (1) Investment Companies (2)
-------------------------------------------------------------------
Charles H. Brunie ZF-Over $100,000
ZTR-Over $100,000 Over $100,000
-------------------------------------------------------------------
Wendy Luscombe ZF-$10,001-$50,000
ZTR-$10,001-$50,000 $10,001-$50,000
-------------------------------------------------------------------
Alden C. Olson ZF-$10,001-$50,000
ZTR-$10,001-$50,000 $10,001-$50,000
-------------------------------------------------------------------
James B. Rogers, Jr. ZF-$10,001-$50,000
ZTR-$1-$10,000 $10,001-$50,000
-------------------------------------------------------------------
R. Keith Walton ZF-$10,001-$50,000 $10,001-$50,000 - By Self
ZTR-$10,001-$50,000 $50,001-$100,000 (3)
-------------------------------------------------------------------
George R. Aylward ZF-$1-$10,000
ZTR-$1-$10,000 $1-$10,000
-------------------------------------------------------------------
--------
(1)The information as to beneficial ownership is based on statements furnished
to each Fund by its Directors and reflects ownership as of December 31,
2007. Except as otherwise indicated, each person has sole voting and
investment power with respect to the shares owned by him or her. The
Directors and officers of the Funds, as a group, beneficially own less than
1% of the outstanding shares of each Fund.
(2)Pursuant to the Proxy Rules, ZF and ZTR are the only funds in the "Family of
Investment Companies."
(3)This includes shares held by Mr. Walton's wife. Mr. Walton disclaims
beneficial ownership of such securities held indirectly, and this shall not
be deemed an admission that Mr. Walton is the beneficial owner of such
securities.
9
Committees and Board of Directors' Meetings
Audit Committee Report
Each Fund's Board of Directors has appointed a standing Audit
Committee. The ZF Board of Directors has adopted a written charter for the
Audit Committee which is available on the Adviser's website at -
http://www.phoenixinvestments.com/phxinv/Individual/Products/
Closed_End_Funds/Zweig/ZF_Audit_Committee_Charter.pdf. The ZTR
Board of Directors has adopted a written charter for the Audit Committee
which is available on the Adviser's website at -
http://www.phoenixinvestments.com/phxinv/Individual/Products/
Closed_End_Funds/Zweig/ZTR_Audit_Committee_Charter.pdf. The purposes
of each Board's Audit Committee are set forth in the Audit Committee
Charter. In brief, the role of each Board's Audit Committee is to assist the
Board of Directors in its oversight of the respective Fund's financial reporting
process. As set forth in the Charter of each Board's Audit Committee,
management of each Fund is responsible for the preparation, presentation
and integrity of the Fund's financial statements, the Fund's accounting and
financial reporting principles and internal controls and procedures designed
to assure compliance with accounting standards and applicable laws and
regulations. The independent registered public accounting firm for each
Fund is responsible for auditing that Fund's financial statements and
expressing an opinion as to their conformity with generally accepted
accounting principles.
In the performance of its oversight function, each Audit Committee has
considered and discussed the audited financial statements with management and
the independent registered public accounting firm of the Fund. Each Audit
Committee also has discussed with the independent registered public accounting
firm the matters required to be discussed by Statement on Auditing Standards
No. 61, "Communication with Audit Committees," as currently in effect. Each
Audit Committee also has considered whether the provision by the Fund's
independent registered public accounting firm of non-audit services to the
Fund, and of professional services to the Adviser and affiliates of the Adviser
that provide services to the Fund, is compatible with maintaining the
independent registered public accounting firm's independence. Finally, each
Audit Committee has received the written disclosures and the letter from the
independent registered public accounting firm required by Independence
Standards Board Standard No. 1, "Independence Discussions with Audit
Committees," and has discussed with the independent registered public
accounting firm the independence of that independent registered public
accounting firm.
The members of each Audit Committee are not professionally engaged in the
practice of auditing or accounting and are not experts in
10
the fields of accounting or auditing or evaluating auditor independence. The
Board of Directors of each Fund has determined that Wendy Luscombe is an "audit
committee financial expert," as defined under Regulation S-K, Item 407(d). The
Securities and Exchange Commission has stated that the designation or
identification of a person as an audit committee financial expert does not
impose on such person any duties, obligations or liability that are greater
than the duties, obligations and liability imposed on such person as a member
of the Audit Committee and the Board of Directors in the absence of such
designation or identification. Each Audit Committee is in compliance with the
New York Stock Exchange requirements applicable to closed-end fund audit
committees, including the requirement that all members of the audit committee
be "financially literate" and that at least one member of the audit committee
have "accounting or related financial management expertise," as determined by
the Board. Members of each Audit Committee rely without independent
verification on the information provided to them and on the representations
made by management and the independent registered public accounting firm.
Accordingly, each Audit Committee's oversight does not provide an independent
basis to determine that management has maintained appropriate accounting and
financial reporting principles or appropriate internal controls and procedures
designed to assure compliance with accounting standards and applicable laws and
regulations. Furthermore, an Audit Committee's considerations and discussions
referred to above do not assure that the audit of a Fund's financial statements
have been carried out in accordance with generally accepted auditing standards,
that the financial statements are presented in accordance with generally
accepted accounting principles or that the Fund's independent registered public
accounting firm is in fact "independent."
Based upon the reports and discussions described in this report, and subject
to the limitations on the role and responsibilities of the Audit Committees
referred to above and in the Audit Committee Charters, each Audit Committee
recommended to its Board of Directors that the audited financial statements of
the applicable Fund be included in the Fund's annual report to shareholders for
the year ended December 31, 2007. The members of each Audit Committee, Messrs.
Brunie, Olson, Rogers and Walton and Ms. Luscombe, are "independent" within the
meaning of the Act and the New York Stock Exchange corporate governance
standards for audit committees applicable to closed-end funds.
Alden C. Olson
Charles H. Brunie
Wendy Luscombe
James B. Rogers, Jr.
R. Keith Walton
11
Nominating Committee
Messrs. Brunie, Olson and Rogers, each of whom is not an interested
person of the Funds, are members of the Nominating Committee of each
Board of Directors. Each Fund's Board of Directors has adopted a written
charter for its Nominating Committee, which is available on the Adviser's
website at - http://www.phoenixinvestments.com/phxinv/Individual/
Products/Closed_End_Funds/Zweig/Nominating_Committee_Charter.pdf.
Each Nominating Committee considers candidates for election to fill
vacancies on the Fund's Board of Directors.
Director nominees are identified based on persons known to the Boards of
Directors or the Nominating Committees and any persons recommended to the
Nominating Committees by shareholders or industry sources. Any recommendations
made by shareholders or industry sources must be accompanied by a biography of
the recommended candidate and should be submitted in writing to the principal
executive office of the Funds, located at 900 Third Avenue, New York, New York
10022, addressed to the Secretary of the Funds. For more information, see
"Additional Information: Proposals for 2009 Meeting."
Nominees are evaluated based on the criteria described below. The evaluation
process does not depend on the source of the recommendation. It is expected
that all candidates for the Board will possess the following minimum
qualifications: (i) unquestioned personal integrity; (ii) sound business
judgment; and (iii) the commitment required to be an effective director,
including, without limitation, the ability to attend meetings regularly. The
Nominating Committee takes into consideration such other factors as it deems
appropriate. Except as provided above, in nominating candidates, each
Nominating Committee does not believe that certain qualifications are
controlling or paramount or that specific qualifications or skills are
necessary for a candidate to posses. Each Nominating Committee may determine
that a candidate who does not have all the qualifications referred to above
should nevertheless be considered as a nominee if the Nominating Committee
finds that the candidate's qualifications, taken as a whole, demonstrate an
equivalent level of qualification to serve as a director.
Board of Directors' and Standing Committees' Meetings
The Board of Directors also has an Executive Committee, consisting of Wendy
Luscombe and R. Keith Walton, each of whom is not an interested person of the
Funds. The Executive Committee of the Board of Directors of each Fund, in the
intervals between meetings of the Board of Directors, has all the authority of
such Board of Directors,
12
except as otherwise provided by that Fund's Articles of Incorporation, By-Laws
or applicable law; provided, however, that the Executive Committee shall not
exercise its authority in a manner inconsistent with any action, direction, or
instruction of the Board of Directors.
The ZF Board of Directors held five meetings and the ZTR Board of Directors
held four meetings during the year ended December 31, 2007. Each Fund's
Nominating Committee held one meeting during the year ended December 31, 2007
and met on February 12, 2008, at which time each Nominating Committee
recommended the nominees for election to the Board. Each Fund's Audit Committee
held two meetings during the year ended December 31, 2007. The Executive
Committee held ten meetings for ZTR and eleven meetings for ZF during the year
ended December 31, 2007. All of the Directors attended at least 75% of the
total number of Board meetings, and his or her respective committee meetings,
held during the year ended December 31, 2007.
Shareholder Communications
Any shareholder that wishes to communicate with the Boards of Directors or a
specific Director may do so by submitting correspondence in writing to the
principal executive office of the Funds, located at 900 Third Avenue, New York,
New York 10022, specifying the intended addressee. Shareholder communications
addressed to the Boards of Directors will be forwarded promptly after receipt
to George R. Aylward, President of the Funds, for review. Mr. Aylward will
review each such communication in order to determine whether the communication
should be relayed directly to each Board member. Shareholder communications
that Mr. Aylward determines involve routine matters will be forwarded to the
Funds' Administrator and/or officers of the Funds for review and response, and
Mr. Aylward will report to the full Board, as appropriate, on the nature and
substance of such communications. Shareholder communications that Mr. Aylward
determines involve non-routine matters will be forwarded to each member of the
Board for review. Shareholder communications addressed to a specific Director
will be forwarded to the addressee promptly upon receipt.
It is the Funds' policy that all Directors attend the annual shareholders
meeting, if reasonably possible. All of the directors attended the joint annual
meeting of ZF and ZTR in 2007.
The Boards of Directors of ZF and ZTR recommend that shareholders vote FOR
the re-election of the nominees.
13
INVESTMENT ADVISER, ADMINISTRATOR AND SUB-ADVISER
Phoenix/Zweig Advisers LLC, the Adviser, serves as the investment adviser
for ZF and ZTR. The Adviser's principal business office is located at 900 Third
Avenue, New York, New York 10022. All of the Adviser's outstanding equity
interests are directly owned by Phoenix Investment Partners, Ltd. ("PXP"), the
wholly-owned investment management subsidiary of The Phoenix Companies, Inc.
("PNX") of Hartford, Connecticut. PNX is a leading provider of wealth
management products and services to individuals and businesses. PNX is located
at One American Row, Hartford, Connecticut, 06115-2520.
PXP has served investors for over 70 years. As of December 31, 2007, PXP had
approximately $55.5 billion in assets under management. PXP's money management
is provided by affiliated investment advisers, as well as through subadvisory
arrangements with outside managers, each specializing in particular investment
styles and asset classes. In February 2008, PNX announced that it intends to
spin off PXP by the end of the third quarter of 2008.
Phoenix Equity Planning Corporation (the "Administrator") serves as the
administrator for ZF and ZTR. The Administrator's principal business office is
located at 56 Prospect Street, P.O. Box 150480, Hartford, Connecticut
06115-0480. All of the Administrator's outstanding equity interests are owned
by PXP.
Zweig Consulting LLC, the Sub-Adviser, which serves as the sub-adviser for
ZF and ZTR, provides asset allocation services to the Adviser. Dr. Martin E.
Zweig is the President and owner of the Sub-Adviser. The Sub-Adviser's
principal business office is located at 900 Third Avenue, New York, New York
10022. The Sub-Adviser's fees are paid by the Adviser.
Section 16(a) Beneficial Ownership Reporting Compliance
Section 16(a) of the Securities Exchange Act of 1934 and Section 30(h) of
the Act require, among other persons, the officers and Directors of the Funds
and the Adviser to file reports of ownership and changes in ownership of the
shares of common stock of the Funds with the Securities and Exchange Commission
and the New York Stock Exchange. The Securities and Exchange Commission's
regulations also require such reporting persons to furnish each Fund with
copies of all Section 16(a) forms they file. Based on its review of these
reports and on written representations from the reporting persons that no other
reports were required, each Fund believes that, during the year ended
December 31, 2007, such reporting persons were in compliance with all
Section 16(a) and Section 30(h) reporting requirements applicable to them.
14
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
At the recommendation of the Audit Committees of the Funds, the Board of
Directors of each Fund, including a majority of the Directors who are not
interested persons of such Fund, has selected the firm of
PricewaterhouseCoopers LLP ("PwC") to serve as the independent registered
public accounting firm of each Fund for the year ending December 31, 2008. A
representative of PwC is expected to be present at the Meeting and will have
the opportunity to make a statement if he or she so desires and to respond to
questions from shareholders.
The aggregate fees billed for services rendered by PwC during the years
ended December 31, 2006 and 2007, respectively, are described below.
Audit Fees
The aggregate fees billed by PwC to ZF in connection with the annual audit
of ZF's financial statements for the fiscal years ended December 31, 2006 and
2007 were $32,600 and $32,600, respectively. The aggregate fees billed by PwC
to ZTR in connection with the annual audit of ZTR's financial statements for
the fiscal years ended December 31, 2006 and 2007 were $32,600 and $32,600,
respectively.
Audit-Related Fees
The fees billed by PwC to ZF for the fiscal years ended December 31, 2006
and December 31, 2007 for any audit-related services were $1,000 and $6,150,
respectively. The fees billed by PwC to ZTR for the fiscal years ended
December 31, 2006 and December 31, 2007 for any audit-related services were
$1,000 and $6,150, respectively. These fees are related to the review of the
Funds' semi-annual financial statements and matters related to the Funds' 2007
rights offerings and Financial Accounting Standards Board Interpretation (FIN)
48.
The aggregate fees billed by PwC to ZF for the fiscal years ended
December 31, 2006 and 2007 in connection with tax review, compliance and advice
were approximately $5,025 and $4,600, respectively. The aggregate fees billed
by PwC to ZTR for the fiscal years ended December 31, 2006 and 2007 in
connection with tax review, compliance and advice were approximately $5,025 and
$4,600, respectively. These fees were related to determination of federal and
excise taxes for the Funds.
All Other Fees
The fees billed by PwC to ZF for the fiscal years ended December 31, 2006
and December 31, 2007 for other services were $907
15
and $1,250, respectively. The fees billed by PwC to ZTR for the fiscal years
ended December 31, 2006 and December 31, 2007 for other services were $906 and
$1,250, respectively. These fees relate to expenses for travel to meetings of
the Board of Directors.
Aggregate Non-Audit Fees
The aggregate non-audit fees billed by PwC for services rendered to the
Funds, the Adviser, and any entity controlling, controlled by, or under common
control with the Adviser that provides ongoing services to the Funds for the
fiscal years ended December 31, 2006 and 2007 were $13,863 and $16,500,
respectively.
Each Audit Committee considered whether the non-audit services rendered to
the Adviser or an affiliate of the Adviser that provides ongoing services to
either Fund were compatible with maintaining the independence of PwC. The Audit
Committees pre-approve: (i) all audit and non-audit services to be rendered to
the respective Fund by PwC; and (ii) all non-audit services relating to the
operations and financial reporting of the respective Fund provided by PwC to
the Adviser or any affiliate thereof that provides ongoing services to the
respective Fund (collectively, "Covered Services"). Each Audit Committee has
adopted pre-approval procedures authorizing a member of the Audit Committee to
pre-approve from time to time, on behalf of the Audit Committee, all Covered
Services to be provided by PwC which are not otherwise pre-approved at a
meeting of the Audit Committee, provided that such delegate reports to the full
Audit Committee at its next meeting. The pre-approval procedures do not include
delegation of the Audit Committee's responsibilities to management.
Pre-approval has not been waived with respect to any of the services described
above since the date on which the Audit Committee adopted its current
pre-approval procedures.
ADDITIONAL INFORMATION
Other Matters
The Boards of Directors of the Funds know of no matters to be presented at
the Meeting other than those specified in the accompanying Notice of Annual
Meeting. However, if any other matter is properly presented before the Meeting,
it is the intention of the persons named as proxies to vote in accordance with
their best judgment.
Expenses
The Funds will bear the expense of the Meeting, including preparation,
printing and mailing of the enclosed form of proxy and
16
accompanying Notice of Annual Meeting and this Proxy Statement. Each Fund will
bear one half of such expenses. Each Fund, upon request, will reimburse banks,
brokers and others for their reasonable expenses in forwarding proxy
solicitation material to the beneficial owners of that Fund's common stock. In
order to obtain the necessary quorum at the Meeting, supplementary solicitation
may be made by mail, telephone or personal interviews by officers or employees
of the Funds and/or Adviser, or their affiliates.
Vote Required
The election of Directors for each Fund requires a plurality of the votes
cast at the Meeting by the shareholders of such Fund. The following principles
of Maryland law apply to the voting of shares of common stock at the Meeting.
The presence in person or by proxy of shareholders entitled to vote a majority
of the outstanding shares will constitute a quorum. Shares represented by proxy
or in person at the Meeting, including shares represented by proxies that
reflect abstentions and broker non-votes (hereinafter defined), will be counted
as present in the determination of a quorum. With respect to the election of
directors, an abstention does not constitute a vote "for" or "against" and will
be disregarded in calculating the votes cast as to such matter, and "broker
non-votes" (i.e., where a broker or nominee submits a proxy specifically
indicating the lack of discretionary authority to vote on a matter) will be
treated in the same manner as abstentions. It is anticipated that votes will be
tabulated by Computershare Trust Company, NA, the Funds' transfer agent.
Proposals for 2009 Meeting
Each Fund's Amended and Restated Bylaws contains an advance notice
provision, which requires that the respective Fund be given advance notice of
shareholder nominations for election to the Board of Directors and of other
matters which shareholders wish to present for action at an annual meeting of
shareholders, other than matters included in that Fund's proxy statement in
accordance with Rule 14a-8 under the Securities Exchange Act of 1934. Any
notice of shareholder nominations for election to the Board of Directors or
notice of other matters which shareholders wish to present at the ZF or ZTR
2009 Annual Meeting of Shareholders must be received at such Fund's principal
executive offices not less than ninety (90) days nor more than one hundred and
twenty (120) days before the date in the then current year corresponding to the
date on which such Fund first mailed its proxy materials for the annual meeting
held in the prior year; provided, however, that in the event that the date of
the annual meeting for such Fund is advanced by more than thirty (30) days or
delayed by more than sixty (60) days from the first anniversary of the
preceding year's annual
17
meeting, notice by such shareholder to be timely must be so received not
earlier than the one hundred twentieth (120th) day prior to such annual meeting
and not later than the close of business on the later of the ninetieth
(90th) day prior to such annual meeting or the tenth (10th) day following the
day on which notice or public announcement of the date of such meeting was
given or made.
The notice by the shareholder must also set forth specific
information, and provide certain representations, the details of which
are set forth in the respective Fund's Amended and Restated Bylaws.
Any shareholder proposal must also comply with all other legal
requirements in order to be included in the Fund's proxy statement and
form of proxy for that meeting. A copy of ZF's By-Laws is available on
the SEC's Web site at http://www.sec.gov/Archives/edgar/data/
812090/000088731804000088/zfbylaws.txt. A copy of ZTR's By-Laws is
available on the SEC's Web site at http://www.sec.gov/Archives/edgar/
data/836412/000088731804000089/ztrbylaws.txt.
The persons named as proxies for the Funds' 2009 Annual Meeting of
Shareholders will, with respect to the proxies in effect at such meeting, have
discretionary authority to vote on any matter presented by a shareholder for
action at that meeting unless the respective Fund receives notice of the matter
by not less than ninety (90) days before the date in the then current year
corresponding to the date on which such Fund first mailed its proxy materials
for the annual meeting held in the prior year. If the respective Fund receives
such timely notice, these persons will not have this authority except as
provided in the applicable rules of the Securities and Exchange Commission.
New York, New York By Order of the Board of
April 3, 2008 Directors of
The Zweig Fund, Inc.
The Zweig Total Return Fund, Inc.
GEORGE R. AYLWARD,
Chairman of the Board
and President
002CS-61515
ZW-PS-08
18
THE ZWEIG TOTAL RETURN FUND, INC.
Annual Meeting of Shareholders
May 6, 2008
Proxy Solicited on Behalf of Board of Directors
The undersigned shareholder of The Zweig Total Return Fund, Inc., a
Maryland corporation (the "Fund"), hereby appoints GEORGE R. AYLWARD, CARLTON
NEEL and DAVID DICKERSON, and each of them, with full power of substitution and
revocation, as proxies to represent the undersigned at the Annual Meeting of
Shareholders of the Fund to be held at 10:00 A.M. at the offices of Katten
Muchin Rosenman LLP, located at 575 Madison Avenue (between 56th and 57th
Streets), 11th Floor, New York, New York, and at any and all adjournments or
postponements thereof, and to vote at the Annual Meeting all shares of the Fund
which the undersigned would be entitled to vote, with all powers the undersigned
would possess if personally present in accordance with the instructions on the
reverse side of this proxy.
WHEN THIS PROXY IS PROPERLY EXECUTED, THE SHARES REPRESENTED HEREBY WILL BE
VOTED AS SPECIFIED. IF NO SPECIFICATION IS MADE, THIS PROXY WILL BE VOTED FOR
THE ELECTION OF ALL NOMINEES AS DIRECTORS AND IN DISCRETION OF THE PROXIES WITH
RESPECT TO ALL OTHER MATTERS WHICH MAY PROPERLY COME BEFORE THE MEETING AND ANY
ADJOURNMENTS THEREOF. THE UNDERSIGNED ACKNOWLEDGES RECEIPT OF THE ACCOMPANYING
NOTICE OF ANNUAL MEETING AND PROXY STATEMENT.
(Continued, and to be signed and dated on the reverse side.)
Please mark boxes[ ] or[ ] in blue or black ink.
1. GRANTING[ ] WITHHOLDING[ ] authority to vote for the election as directors of
all the nominees listed below: R. Keith Walton and Wendy Luscombe.
(Instructions: To withhold authority to vote for any individual nominee, strike
a line through the nominee's name.)
2. In their discretion, on such other matters as may properly come before the
meeting and any adjournments thereof.
Please sign exactly as name or names appears on this proxy.
If stock is held jointly, each holder should sign. If
signing as attorney, trustee, executor, administrator,
custodian, guardian or corporate officer, please give full
title.
Dated , 2008
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Signature
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Signature
Sign, Date and Return the Proxy Card Promptly Using the Enclosed Envelope.