The Fund announced that approximately 96% of its stockholders have approved a major strategic conversion from a Caribbean Basin-focused equity strategy to a CLO Equity Strategy. The decision was made at a Special Meeting of Stockholders on June 17, 2025, with the changes set to be effective from July 1, 2025.
This strategic shift will alter the fund’s primary investment objective to maximize risk-adjusted total returns, with a secondary objective of generating high current income. The fund will now focus on investing in equity and junior debt tranches of collateralized loan obligations (CLOs), which consist of below-investment-grade U.S. senior secured loans spread across various industry sectors.
Stockholders approved three pivotal proposals during the meeting. The first proposal involved an amended advisory agreement, allowing the fund’s adviser, Thomas J. Herzfeld Advisors, Inc., to receive fees based on “managed assets” along with an incentive fee. The second proposal revised the fund’s investment objective to prioritize maximizing risk-adjusted total returns, reclassifying the objective as non-fundamental to provide flexibility for future adjustments. The third proposal approved amendments to fundamental policies concerning borrowing, securities, and investment activities.