formn2_pos-ami

0000902561-04-000170.txt : 20040422 0000902561-04-000170.hdr.sgml : 20040422 20040422172955 ACCESSION NUMBER: 0000902561-04-000170 CONFORMED SUBMISSION TYPE: POS AMI PUBLIC DOCUMENT COUNT: 24 FILED AS OF DATE: 20040422 FILER: COMPANY DATA: COMPANY CONFORMED NAME: DNP SELECT INCOME FUND INC CENTRAL INDEX KEY: 0000806628 IRS NUMBER: 363480989 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: POS AMI SEC ACT: 1940 Act SEC FILE NUMBER: 811-04915 FILM NUMBER: 04748954 BUSINESS ADDRESS: STREET 1: PO BOX 32760 CITY: LOUISVILLE STATE: KY ZIP: 40232 BUSINESS PHONE: 3123685510 MAIL ADDRESS: STREET 1: PO BOX 32760 CITY: LOUISVILLE STATE: KY ZIP: 40232 FORMER COMPANY: FORMER CONFORMED NAME: DUFF & PHELPS SELECTED UTILITIES INC DATE OF NAME CHANGE: 19910429 POS AMI 1 formn2.htm formn2_pos-ami

As filed with the Securities and Exchange Commission on April 22, 2004

Investment Company Act file no. 811-4915

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

_____

FORM N-2

_____

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940		[X]
Amendment No. 46		[X]

_____

DNP SELECT INCOME FUND INC.
(Exact name of registrant as specified in charter)

_____

55 East Monroe Street
Chicago, Illinois 60603
(Address of principal executive offices)
Registrant's telephone number: 312/368-5510

Nathan I. Partain		John R. Sagan
DNP Select Income Fund Inc.		Mayer, Brown, Rowe & Maw LLP
55 East Monroe Street		190 South LaSalle Street
Chicago, Illinois 60603		Chicago, Illinois 60603

(Names and addresses of agents for service)

It is proposed that this filing will become effective:
[X] immediately upon filing.

[ ] This post-effective amendment designates a new effective date for a previously filed post-effective amendment.

PART A: INFORMATION REQUIRED IN A PROSPECTUS

Item 1. Outside Front Cover

Not applicable.

Item 2. Cover Pages; Other Offering Information

Not applicable.

Item 3. Fee Table and Synopsis

Shareholder Transaction Expenses

	Sales Load (as a percentage of offering price)…………………………………….	N/A

	Dividend Reinvestment and Cash Purchase Plan Fees……………………………	(1)

Annual Expenses (as a percentage of net assets attributable to common shares)

	Management Fees…………………………………………….……………………	0.81%

	Interest Payments on Borrowed Funds……………………….…………………...	0.17%

	Other Expenses……………………………………………….…………………...	0.91%

	Total Annual Expenses…………………………………………………	1.89%

	Example (2)	1 year	2 years	5 years	10 years

You would pay the following expenses on a $1,000 investment, assuming a 5% annual return		$19	$39	$102	$221

(1)	Shareholders that reinvest dividends and/or capital gains distributions will be charged only brokerage fees in the event that shares are purchased in the open market. Investors investing cash in addition to any cash dividends reinvested will be charged brokerage commissions plus a service fee of $2.50 per transaction. See Item 10.1(c).

(2)	This Example should not be considered a representation of future expenses, and actual expenses may be greater or lesser than those shown.

The purpose of the foregoing table is to assist an investor in understanding the costs and expenses that an investor will bear directly or indirectly, and the information contained therein is not necessarily indicative of future performance. "Other Expenses" are based on estimated amounts for the current fiscal year. For a more detailed description of management fees paid by the Fund, see Item 9.1(b) and (d). For a more detailed description of the interest paid on borrowed funds, see Item 8.3, under the heading "Risk Factors–Leverage."

2. Not applicable.

3. Not applicable.

Item 4. Financial Highlights

Not applicable.

Item 5. Plan of Distribution

Not applicable.

Item 6. Selling Shareholders

Not applicable.

Item 7. Use of Proceeds

Not applicable.

Item 8. General Description of the Registrant

	1.	General

		(a) The Registrant, DNP Select Income Fund Inc. (the "Fund"), is a corporation organized under the laws of the State of Maryland on November 26, 1986.

		(b) The Fund is a diversified closed-end investment company.

	2.	Investment Objectives and Policies

Investment objectives

The Fund's primary investment objectives are current income and long-term growth of income. Capital appreciation is a secondary objective.

Principal investment strategies

The Fund seeks to achieve its investment objectives by investing primarily in a diversified portfolio of equity and fixed income securities of companies in the public utilities industry. Under normal conditions, more than 65% of the Fund's total assets will be invested in securities of public utility companies engaged in the production, transmission or distribution of electric energy, gas or telephone services. The Fund's investment objectives stated in the preceding paragraph and its policy of concentrating its investments in the utilities industry are fundamental policies and may not be changed without the approval of the holders of a "majority" (as defined in the Investment Company Act of 1940, as amended (the "1940 Act")) of the outstanding shares of the common stock and the preferred stock voting together as one class, which means the lesser of (i) 67% of the shares represented at a meeting at which more than 50% of the outstanding shares are represented or (ii) more than 50% of the outstanding shares.

Fundamental investment restrictions

The following are fundamental investment restrictions of the Fund that may be changed only with approval of the holders of a "majority" (as defined in the 1940 Act) of the outstanding shares of the common stock and the preferred stock voting together as one class:

	1. The Fund may not invest more than 25% of its total assets (valued at the time of investment) in securities of companies engaged principally in any one industry other than the utilities industry, which includes companies engaged in the production, transmission or distribution of electric energy or gas or in telephone services, except that this restriction does not apply to securities issued or guaranteed by the United States Government or its agencies or instrumentalities.

	2. The Fund may not:

	(a) invest more than 5% of its total assets (valued at the time of the investment) in the securities of any one issuer, except that this restriction does not apply to United States Government securities; or

	(b) acquire more than 10% of the outstanding voting securities of any one issuer (at the time of acquisition);

	except that up to 25% of the Fund's total assets (at the time of investment) may be invested without regard to the limitations set forth in this restriction.

	3. The Fund may borrow money on a secured or unsecured basis for any purpose of the Fund in an aggregate amount not exceeding 15% of the value of the Fund's total assets at the time of any such borrowing (exclusive of all obligations on amounts held as collateral for securities loaned to other persons to the extent that such obligations are secured by assets of at least equivalent value).

	4. The Fund may not pledge, mortgage or hypothecate its assets, except to secure indebtedness permitted by restriction 3 above. (The deposit in escrow of securities in connection with the writing of put and call options, collateralized loans of securities and collateral arrangements with respect to margin requirements for futures transactions and with respect to segregation of securities in connection with forward contracts are not deemed to be pledges or hypothecations for this purpose.)

	5. The Fund may make loans of securities to other persons to the extent of not more than 33 1/3% of its total assets (valued at the time of the making of loans), and may invest without limitation in short-term obligations and publicly distributed obligations.

	6. The Fund may not underwrite the distribution of securities of other issuers, although it may acquire securities that, in the event of a resale, might be required to be registered under the Securities Act of 1933, as amended, because the Fund could be regarded as an underwriter as defined in that act with respect to the resale.

	7. The Fund may not purchase or sell real estate or any interest therein, except that the Fund may invest in securities secured by real estate or interests therein, such as mortgage pass-throughs, pay-throughs, collateralized mortgage obligations, and securities issued by companies (including partnerships and real estate investment trusts) that invest in real estate or interests therein.

	8. The Fund may acquire securities of other investment companies to the extent (at the acquisition) of (i) not more than 3% of the outstanding voting stock of any one investment company, (ii) not more than 5% of the assets of the Fund in any one investment company and (iii) not more than 10% of the assets of the Fund in all investment companies (exclusive in each case of securities received as a dividend or as a result of a merger, consolidation or other plan of reorganization).

	9. The Fund may not invest for the purpose of exercising control over or management of any company.

	10. The Fund may not purchase securities on margin, or make short sales of securities, except the use of short-term credit necessary for the clearance of purchases and sales of portfolio securities, but it may make margin deposits in connection with transactions in options, futures and options on futures.

	11. The Fund may not purchase or sell commodities or commodity contracts, except that it may enter into (i) stock index futures transactions, interest rate futures transactions and options on such future transactions and (ii) forward contracts on foreign currencies to the extent permitted by applicable law.

	12. The Fund may not issue any security senior to its common stock, except that the Fund may borrow money subject to investment restriction 3 and except as permitted by the Fund's charter.

If a percentage restriction set forth above is adhered to at the time a transaction is effected, later changes in percentages resulting from changes in value or in the number of outstanding securities of an issuer will not be considered a violation.

Other Significant Investment Policies

Fixed Income Securities. The Fund purchases a fixed income security only if, at the time of purchase, it is (i) rated investment grade by at least two of the following three nationally recognized statistical rating organizations: Moody's Investors Service, Inc. ("Moody's"), Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc. ("S&P"), and Fitch, Inc. ("Fitch") or (ii) determined by the Fund's investment adviser to be of investment grade and not rated below investment grade by any of the aforementioned rating services. A fixed income security rated investment grade has a rating of BBB- or better by Fitch, Baa3 or better by Moody's, or BBB- or better by S&P. In making its determination that a fixed income security is investment grade, the Fund's investment adviser will use the standards used by a nationally recognized statistical rating organization.

Leverage. The Fund is authorized to borrow money in amounts of up to 15% of the value of its total assets at the time of such borrowings. However, for so long as the Fund's preferred stock is rated by S&P, the Fund will limit the aggregate amount of its borrowings to 10% of the value of its total assets and will not incur any borrowings, unless advised by S&P that such borrowings would not adversely affect S&P's then-current rating of the preferred stock.

Lending of Portfolio Securities. In order to generate additional income, the Fund may from time to time lend securities from its portfolio, with a value not in excess of 33 1/3% of its total assets, to brokers, dealers and financial institutions such as banks and trust companies for which it will receive collateral in cash, United States Government securities or an irrevocable letter of credit that will be maintained in an amount equal to at least 100% of the current market value of the loaned securities.

Rating Agency Guidelines. The Fund's preferred stock is currently rated by Moody's and S&P, nationally recognized statistical rating organizations, which issue ratings for various securities reflecting the perceived creditworthiness of those securities. The Fund intends that, so long as shares of its preferred stock are outstanding, the composition of its portfolio will reflect guidelines established by the foregoing rating organizations in connection with the Fund's receipt of the highest rating for its preferred stock from at least two of such rating organizations.

Options and Futures Transactions. The Fund may seek to increase its current return by writing covered options. In addition, through the writing and purchase of options and the purchase and sale of futures contracts and related options, the Fund may at times seek to hedge against a decline in the value of securities owned by it or an increase in the price of securities which it plans to purchase. However, for so long as shares of the Fund's preferred stock are rated either by Moody's or S&P, the Fund will not purchase or sell futures contracts or related options or engage in other hedging transactions unless Moody's or S&P, as the case may be, advises the Fund that such action or actions will not adversely affect its then-current rating of the Fund's preferred stock.

Temporary Investments. For temporary defensive purposes, the Fund may be invested primarily in money market securities. These securities include securities issued or guaranteed by the United States Government and its agencies and instrumentalities, commercial paper and certificates of deposit. To the extent that the Fund engages in such defensive investments, it may not achieve its investment objectives.

Nonfundamental Restrictions. The Fund may not (i) invest in securities subject to legal or contractual restrictions on resale, if, as a result of such investment, more than 10% of the Fund's total assets would be invested in such securities, or (ii) acquire 5% or more of the outstanding voting securities of a public utility company.

Each of the policies and restrictions described above may be changed by the board of directors without the approval of the Fund's shareholders. If a percentage restriction set forth above is adhered to at the time a transaction is effected, later changes in percentages resulting from changes in value or in the number of outstanding securities of an issuer will not be considered a violation.

3.   Risk Factors





Leverage. As of December 31, 2003, the Fund had outstanding indebtedness of $198,974,940 and five series of preferred stock with an aggregate liquidation preference of $500 million. The dividend rate on each series of preferred stock is reset every 49 days through a remarketing procedure. As of April 8, 2004, the dividend rate on the five series of preferred stock averaged 1.08% and the interest rate on the Fund's outstanding indebtedness averaged 1.24%. The Fund must experience an annual return of 0.27% on its portfolio in order to cover annual interest and dividend payments on the Fund's outstanding indebtedness and preferred stock.

Leverage creates certain risks for holders of common stock, including higher volatility of both the net asset value and market value of the common stock. Fluctuations in dividend rates on the preferred stock and interest rates on the Fund's indebtedness will affect the dividend to holders of common stock. Holders of the common stock receive all net income from the Fund remaining after payment of dividends on the preferred stock and interest on the Fund's indebtedness, and generally are entitled to a pro rata share of net realized capital gains, if any.

Upon any liquidation of the Fund, the holders of shares of preferred stock will be entitled to liquidating distributions (equal to $100,000 per share of preferred stock plus any accumulated and unpaid dividends thereon) and the holders of the Fund's indebtedness will be entitled to receive repayment of outstanding principal plus accumulated and unpaid interest thereon before any distribution is made to holders of common stock.

The leverage obtained through the issuance of the preferred stock and from the Fund's presently outstanding indebtedness has provided holders of common stock with a higher dividend than such holders would have otherwise received. However, there can be no assurance that the Fund will be able to continue to realize such a higher net return on its investment portfolio. Changes in certain factors could cause the relationship between the dividends paid on the preferred stock and interest paid on the Fund's indebtedness to increase relative to the dividend and interest rates on the portfolio securities in which the Fund may be invested. Under such conditions the benefit of leverage to holders of common stock will be reduced and the Fund's leveraged capital structure could result in a lower rate of return to holders of common stock than if the Fund were not leveraged. The Fund is required by the 1940 Act to maintain an asset coverage of 200% on outstanding preferred stock and 300% on outstanding indebtedness. If the asset coverage declines below those levels (as a result of market fluctuations or otherwise), the Fund may be required to sell a portion of its investments at a time when it may be disadvantageous to do so.

The following table illustrates the effects of leverage on a return to common stockholders. The figures appearing in the table are hypothetical and actual returns may be greater or less than those appearing in the table.

Assumed annual return on portfolio (net of expenses)	-10.00%	-5.00%	0.00%	5.00%	10.00%
Corresponding annual return to common stockholder	-14.53%	-7.52%	-0.51	6.50%	13.52%

	Investments in Securities of Foreign Issuers. While the Fund is prohibited from investing 15% or more of its assets in securities of foreign issuers, the Fund may be exposed to certain risks as a result of foreign investments. Investing in securities of foreign issuers involves certain considerations not typically associated with investing in securities of U.S. companies, including (a) controls on foreign investment and limitations on repatriation of invested capital and on the Fund's ability to exchange local currencies for U.S. dollars, (b) greater price volatility, substantially less liquidity and significantly smaller market capitalization of securities markets, (c) currency devaluations and other currency exchange rate fluctuations, (d) more substantial government involvement in the economy, (e) higher rates of inflation, (f) less government supervision and regulation of the securities markets and participants in those markets and (g) political uncertainty and other considerations. The Fund will treat investments in countries with repatriation restrictions as illiquid for purposes of any applicable limitations under the 1940 Act; however, as a closed-end fund, the Fund is not currently limited under that Act in the amount of illiquid securities it may acquire. Because of the limited forward market for the purchase of U.S. dollars in most foreign countries and the limited circumstances in which the Fund expects to hedge against declines in the value of foreign country currencies generally, the Fund will be adversely affected by devaluations of foreign country currencies against the U.S. dollar to the extent the Fund is invested in securities denominated in currencies experiencing a devaluation. The Fund's fundamental investment policies permit the Fund to enter into currency hedging transactions.

	In addition, accounting, auditing and financial reporting standards in foreign countries are different from U.S. standards. As a result, certain material disclosures may not be made and less information may be available to the Fund and other investors than would be the case if the Fund's investments were restricted to securities of U.S. issuers. Moreover, it may be more difficult to obtain a judgment in a court outside the United States. Interest and dividends paid on securities held by the Fund and gains from the disposition of such securities may be subject to withholding taxes imposed by foreign countries.

	Anti-takeover Provisions. Certain provisions of the Fund's charter may be regarded as "anti-takeover" provisions because they could have the effect of limiting the ability of other entities or persons to acquire control of the Fund. See Item 10.l(e).

	Premium/Discount From Net Asset Value. Shares of closed-end investment companies trade in the market above, at and below net asset value. This characteristic of shares of closed-end investment companies is a risk separate and distinct from the risk that the Fund's net asset value may decline. Since inception, the Fund's common stock has generally traded at a premium to net asset value. For example, in the two-year period ended December 31, 2003, as of the close of business of the New York Stock Exchange on the last day in each week on which the New York Stock Exchange was open (the date the Fund calculates its net asset value per share), the Fund's shares were trading at a premium to net asset value 100% of the time. The Fund usually does not calculate its net asset value per share on any other day and does not know whether the Fund's shares were trading at a premium to net asset value on such days. The Fund is not able to predict whether its shares will trade above, at or below net asset value in the future.

	Dividend Captures. The Fund seeks to increase its dividend income using a strategy called "dividend capture." In a dividend capture trade, the Fund sells a stock that it held past its ex-dividend date to purchase another stock paying a dividend before the next dividend of the stock being sold. The use of dividend capture strategies exposes the Fund to increased trading costs and the potential for capital loss. During 2003, dividend captures accounted for approximately 37% of the Fund's net investment income and had a impact on the Fund's net asset value (including both transaction costs and capital losses) of -0.49%. Beginning in 2004, the Fund expects to derive less of its income from dividend captures and more of its income from investment gains. Until the Fund utilizes all of its tax loss carry forwards, distributions derived from capital gains in the Fund's portfolio may constitute ordinary income, rather than capital gains, to shareholders. See Item 22, "Tax Status."

4. Other Policies

None.

5. Share Price Data

The Fund's common stock has been listed on the New York Stock Exchange since January 21, 1987 (trading symbol DNP). Since the commencement of trading, the Fund's common stock has most frequently traded at a premium to net asset value, but has periodically traded at a slight discount. The following table shows the range of the market prices of the Fund's common stock, net asset value of the Fund's shares corresponding to such high and low prices and the premium to net asset value presented by such high and low prices:

Quarter Ended		Market Price		Net Asset Value at		Market Premium (Discount) to Net Asset Value at
		High	Low	Market High	Market Low	Market High	Market Low
2004	March 31	$11.42	$10.73	$8.17	$8.12	39.78%	32.14%

2003	December 31	11.08	10.12	7.91	7.61	40.08%	32.98%

	September 30	11.09	9.90	7.53	7.32	47.28%	35.25%

	June 30	11.08	9.87	7.93	6.94	39.72%	42.22%

	March 31	10.75	9.69	7.51	6.85	43.14%	41.46%

2002	December 31	10.00	8.19	7.31	6.35	36.80%	28.98%

	September 30	10.43	7.85	7.61	7.09	37.06%	10.72%

	June 30	11.62	9.15	9.09	8.63	27.83%	6.03%

	March 31	11.37	10.90	9.32	9.13	22.00%	19.39%

On April 8, 2004, the net asset value was $8.07, trading prices ranged between $10.93 and $11.05 (representing a premium to net asset value of 35.44% and 36.93%, respectively) and the closing price was $11.01 (representing a premium to net asset value of 36.43%).

6. Business Development Companies

Not applicable.

Item 9. Management

1. General

		(a) Board of Directors

		The business and affairs of the Fund are managed under the direction of the board of directors.

		(b) Investment Adviser

		The Fund's investment adviser (the "Adviser") is Duff & Phelps Investment Management Co., 55 East Monroe Street, Chicago, Illinois 60603. The Adviser (together with its predecessor) has been in the investment advisory business for more than 60 years and, excluding the Fund, currently has more than $2.6 billion in client accounts under discretionary management. The Adviser acts as adviser to two other closed-end investment companies registered under the 1940 Act and as sub-adviser to three open-end investment companies registered under the 1940 Act. The Adviser is a wholly-owned subsidiary of Phoenix Investment Partners, Ltd. ("Phoenix Investment Partners"), which is an indirect, wholly-owned subsidiary of The Phoenix Companies, Inc. Prior to May 11, 1998, Phoenix Investment Partners was known as Phoenix Duff & Phelps Corporation. Phoenix Investment Partners, through its subsidiaries, provides investment management, investment research, financial consulting and investment banking services.

		The Adviser is responsible for the management of the Fund's investment portfolio, subject to the overall control of the board of directors of the Fund.

		Under the terms of an investment advisory agreement between the Fund and the Adviser (the "Advisory Agreement"), the Adviser receives from the Fund a quarterly fee at an annual rate of .60% of the average weekly net asset value of the Fund up to $1.5 billion and .50% of average weekly net assets in excess of $1.5 billion. The net assets for each weekly period are determined by averaging the net assets at the end of a week with the net assets at the end of the prior week. For purposes of the foregoing calculation, "net assets" are defined as the sum of (i) the aggregate net asset value of the Fund's common stock, (ii) the aggregate liquidation preference of the Fund's preferred stock and (iii) the aggregate proceeds to the Fund of commercial paper issued by the Fund.

		Under the terms of a service agreement among the Adviser, Phoenix Investment Partners, and the Fund (the "Service Agreement"), Phoenix Investment Partners makes available to the Adviser the services, on a part-time basis, of its employees and various facilities to enable the Adviser to perform certain of its obligations to the Fund. However, the obligation of performance under the Advisory Agreement is solely that of the Adviser, for which Phoenix Investment Partners assumes no responsibility, except as described in the preceding sentence. The Adviser reimburses Phoenix Investment Partners for any costs, direct or indirect, fairly attributable to the services performed and the facilities provided by Phoenix Investment Partners under the Service Agreement. The Fund does not pay any fees pursuant to the Service Agreement.

		(c) Portfolio Management

		The Fund's portfolio is managed by Nathan I. Partain and T. Brooks Beittel. Mr. Partain has been responsible for the management of the equity investments in the Fund's portfolio since January 1998. He has been President and Chief Executive Officer of the Fund since February 2001 (Chief Investment Officer since January 1998, Executive Vice President April 1998-February 2001, Senior Vice President January 1997-April 1998, Assistant Secretary January 1997-February 2001); Executive Vice President, Duff & Phelps Investment Management Co. since January 1997; and Director of Utility Research, Phoenix Investment Partners, Ltd., 1989-1996 (Director of Equity Research, 1993-1996 and Director of Fixed Income Research, 1993). Mr. Beittel has been responsible for the management of the fixed income investments in the Fund's portfolio since April 1994. He has been Secretary and Senior Vice President of the Fund since January 1995 (Treasurer January 1995-September 2002) and Senior Vice President, Duff & Phelps Investment Management Co. since 1993 (Vice President 1987-1993).

		(d) Administrator

		The Fund's administrator (the "Administrator") is J.J.B. Hilliard, W.L. Lyons, Inc., Hilliard Lyons Center, Louisville, Kentucky 40202. The Administrator is a wholly-owned subsidiary of The PNC Financial Services Group, Inc. Under the terms of an administration agreement (the "Administration Agreement"), the Administrator provides all management and administrative services required in connection with the operation of the Fund not required to be provided by the Adviser pursuant to the Advisory Agreement, as well as the necessary office facilities, equipment and personnel to perform such services. For its services, the Administrator receives from the Fund a quarterly fee at annual rates of .25% of the Fund's average weekly net assets up to $100 million, .20% of the Fund's average weekly net assets from $100 million to $1.0 billion and .10% of average weekly net assets over $1.0 billion. The net assets for each weekly period are determined by averaging the net assets at the end of a week with the net assets at the end of the prior week. For purposes of the foregoing calculation, "net assets" are defined as the sum of (i) the aggregate net asset value of the Fund's common stock, (ii) the aggregate liquidation preference of the Fund's preferred stock and (iii) the aggregate proceeds to the Fund of commercial paper issued by the Fund.

		(e) Custodian

		The Fund's custodian is The Bank of New York, Church Street Station, Post Office Box 11258, New York, New York 10286. The transfer agent and dividend disbursing agent for the Fund's common and preferred stock is The Bank of New York, Church Street Station, P.O. Box 11258, New York, New York 10286.

		(f) Expenses

		The Fund is responsible for all expenses not paid by the Adviser or the Administrator, including brokerage fees.

		(g) Affiliated Brokerage

		The Fund has paid, and in the future may pay, broker commissions to the Administrator. See Item 21.2.

		Non-resident Managers.

		Not applicable.

		Control Persons.

		The Fund does not consider that any person "controls" the Fund within the meaning of this item. For information concerning the Fund's officers and directors, see Item 18. No person is known by the Fund to own of record or beneficially five percent or more of any class of the Fund's outstanding equity securities.

Item 10. Capital Stock, Long-Term Debt, and Other Securities

	1.	Capital Stock.

		(a) Common Stock. Holders of common stock, $.001 par value per share, of the Fund are entitled to dividends when and as declared by the board of directors, to one vote per share in the election of directors (with no right of cumulation), and to equal rights per share in the event of liquidation. They have no preemptive rights. There are no redemption, conversion or sinking fund provisions. The shares are not liable to further calls or to assessment by the Fund.

		(b) Preferred Stock. Holders of preferred stock, $.001 par value per share, of the Fund are entitled to receive dividends before the holders of the common stock and are entitled to receive the liquidation value of their shares ($100,000 per share) before any distributions are made to the holders of the common stock, in the event the Fund is ever liquidated. Each share of preferred stock is entitled to one vote per share. The holders of the preferred stock have the right to elect two directors of the Fund at all times and to elect a majority of the directors if at any time dividends on the preferred stock are unpaid for two years. In addition to any approval by the holders of the shares of the Fund that might otherwise be required, the approval of the holders of a majority of the outstanding shares of the preferred stock, voting separately as a class, will be required under the 1940 Act to adopt any plan of reorganization that would adversely affect the holders of preferred stock and to approve, among other things, changes in the Fund's sub-classification as a closed-end investment company, changes in its investment objectives or changes in its fundamental investment restrictions.

		Subject to certain restrictions, the Fund may, and under certain circumstances is required to, redeem shares of its preferred stock at a price of $100,000 per share, plus accumulated but unpaid dividends. The shares of preferred stock are not liable to further calls or to assessment by the Fund. There are no preemptive rights or sinking fund or conversion provisions. The Fund, may, however, upon the occurrence of certain events, authorize the exchange of its current preferred stock on a share-for-share basis for a separate series of authorized but unissued preferred stock having different dividend privileges.

		(c) Dividend Reinvestment Plan. Under the Fund's dividend reinvestment plan shareholders may elect to have all dividends and capital gains distributions paid on their common stock automatically reinvested by The Bank of New York, as agent for shareholders, in additional shares of common stock of the Fund. Registered shareholders may participate in the plan. The plan permits a nominee, other than a depository, to participate on behalf of those beneficial owners for whom it is holding shares who elect to participate. However, some nominees may not permit a beneficial owner to participate without transferring the shares into the owner's name. Shareholders who do not elect to participate in the plan will receive all distributions in cash paid by check mailed directly to the shareholder (or, if the shareholder's shares are held in street or other nominee name, then to such shareholder's nominee) by The Bank of New York as dividend disbursing agent. Registered shareholders may also elect to have cash dividends deposited directly into their bank accounts.

		When a dividend or distribution is reinvested under the plan, the number of shares of common stock equivalent to the cash dividend or distribution is determined as follows:

		(i) If shares of the common stock are trading at net asset value or at a premium above net asset value at the valuation date, the Fund issues new shares of common stock at the greater of net asset value or 95% of the then current market price.

		(ii) If shares of the common stock are trading at a discount from net asset value at the valuation date, The Bank of New York receives the dividend or distribution in cash and uses it to purchase shares of common stock in the open market, on the New York Stock Exchange or elsewhere, for the participants' accounts. Shares are allocated to participants' accounts at the average price per share, plus commissions, paid by The Bank of New York for all shares purchased by it. If, before The Bank of New York has completed its purchases, the market price exceeds the net asset value of a share, the average purchase price per share paid by The Bank of New York may exceed the net asset value of the Fund's shares, resulting in the acquisition of fewer shares than if the dividend or distribution had been paid in shares issued by the Fund.

		The valuation date is the business day immediately preceding the date of payment of the dividend or distribution. On that date, the Administrator compares that day's net asset value per share and the closing price per share on the New York Stock Exchange and determines which of the two alternative procedures described above will be followed.

		The reinvestment shares are credited to the participant's plan account in the Fund's stock records maintained by The Bank of New York, including a fractional share to four decimal places. The Bank of New York will send participants written confirmation of all transactions in the participant's plan account, including information participants will need for tax records. Shares held in the participant's plan account have full dividend and voting rights. Dividends and distributions paid on shares held in the participant's plan account will also be reinvested.

		The cost of administering the plan is borne by the Fund. There is no brokerage commission on shares issued directly by the Fund. However, participants do pay a pro rata share of brokerage commissions incurred on any open market purchases of shares by The Bank of New York.

		The automatic reinvestment of dividends and distributions does not relieve participants of any income taxes that may be payable (or required to be withheld) on dividends or distributions.

		If the closing market price of shares of the Fund's common stock should be equal to or greater than their net asset value on the valuation date, the participants in the plan would receive shares priced at the higher of net asset value or 95% of the market price. Consequently they would receive more shares at a lower per share price than if they had used the cash distribution to purchase Fund shares on the payment date in the market at the market price plus commission.

		If the market price should be less than net asset value on the valuation date, the cash distribution for the plan participants would be used by The Bank of New York to purchase the shares to be received by the participants, which would be at a discount from net asset value unless the market price should rise during the purchase period so that the average price and commission exceeded net asset value as of the payment date. Also, since the Fund does not redeem its shares, the price on resale may be less or more than the net asset value.

		Plan participants may purchase additional shares of common stock through the plan by delivering to The Bank of New York a check for at least $100, but not more than $5,000, in any month. The Bank of New York will use such funds to purchase shares in the open market or in private transactions. The purchase price of such shares may be more than or less than net asset value per share. The Fund will not issue new shares or supply treasury shares for such voluntary additional share investment. Purchases will be made commencing with the time of the first distribution payment following the second business day after receipt of the funds for additional purchases, and may be aggregated with purchases of shares for reinvestment of the distribution. Shares will be allocated to the accounts of participants purchasing additional shares at the average price per share, plus a service charge of $2.50 imposed by The Bank of New York and a pro rata share of any brokerage commission (or equivalent purchase costs) paid by The Bank of New York in connection with such purchases. Funds sent to the bank for voluntary additional share reinvestment may be recalled by the participant by written notice received by The Bank of New York not later than two business days before the next dividend payment date. If for any reason a regular monthly dividend is not paid by the Fund, funds for voluntary additional share investment will be returned to the participant, unless the participant specifically directs that such funds continue to be held by The Bank of New York for subsequent investment. Participants will not receive interest on voluntary additional funds held by The Bank of New York pending investment.

		A shareholder may leave the plan at any time by written notice to The Bank of New York. To be effective for any given distribution, notice must be received by the Bank at least seven business days before the record date for that distribution. When a shareholder leaves the plan: (i) such shareholder may request that The Bank of New York sell such shareholder's shares held in such shareholder's plan account and send such shareholder a check for the net proceeds (including payment of the value of a fractional share, valued at the closing price of the Fund's common stock on the New York Stock Exchange on the date discontinuance is effective) after deducting The Bank of New York's $5.00 charge and any brokerage commission (or equivalent sale cost) or (ii) if no request is made, such shareholder will receive a certificate for the number of full shares held in such shareholder's plan account, along with a check for any fractional share interest, valued at the closing price of the Fund's common stock on the New York Stock Exchange on the date discontinuance is effective. If and when it is determined that the only balance remaining in a shareholder's plan account is a fraction of a single share, such shareholder's participation will be deemed to have terminated, and The Bank of New York will send to such shareholder a check for the value of such fractional share, valued at the closing price of the Fund's common stock on the New York Stock Exchange on the date discontinuance is effective.

		The Fund may change, suspend or terminate the plan at any time upon mailing a notice to participants.

		For more information regarding, and an authorization form for, the dividend reinvestment plan, please contact The Bank of New York at 1-877-381-2537 or on the World Wide Web at http://stock.bankofny.com.

		(d) Capital Gains Distribution Reinvestment Plan. Unless otherwise indicated by a holder of shares of common stock of the Fund that does not participate in the Fund's dividend reinvestment plan, all distributions in respect of capital gains distributions on shares of common stock held by such holder will be automatically invested by The Bank of New York, as agent of the common shareholders participating in the plan, in additional shares of common stock of the Fund. Distributions in respect of capital gains distributions on shares of common stock that participate in the Fund's dividend reinvestment plan will be reinvested in accordance with the terms of such plan.

		In any year in which the Fund declares a capital gains distribution, the Fund after the declaration of such dividend and prior to its payment, will provide to each registered holder of Fund common stock that does not participate in the Fund's dividend reinvestment plan a cash election card. A registered shareholder may elect to receive cash in lieu of shares in respect of a capital gains distribution by signing the cash election card in the name(s) of the registered shareholder(s), and mailing the card to The Bank of New York.

		If a holder's shares of common stock, or some of them, are registered in the name of a broker or other nominee, and the holder wishes to receive a capital gains distribution in cash in lieu of shares of common stock, such shareholder must exercise that election through its nominee (including any depositor of shares held in a securities depository).

		When a distribution is reinvested under the plan, the number of reinvestment shares is determined as follows:

	(i) If, at the time of valuation, the shares are being traded in the securities markets at net asset value or at a premium over net asset value, the reinvestment shares are obtained by The Bank of New York directly from the Fund, at a price equal to the greater of net asset value or 95% of the then current market price, without any brokerage commissions (or equivalent purchase costs).

	(ii) If, at the time of valuation, the shares are being traded in the securities markets at a discount from net asset value, The Bank of New York receives the distribution in cash, and uses it to purchase shares in the open market, including on the New York Stock Exchange, or in private purchases. Shares of common stock are allocated to participants at the average price per share, plus any brokerage commissions (or equivalent transaction costs), paid by The Bank of New York for all shares purchased by it in reinvestment of the distribution(s) paid on a particular day.

		The time of valuation is the close of trading on the New York Stock Exchange on the most recent day preceding the date of payment of the dividend or distribution on which that exchange is open for trading. As of that time, the Administrator compares the net asset value per share as of the time of the close of trading on the New York Stock Exchange on that day and the last reported sale price per share on the New York Stock Exchange, and determines which of the alternative procedures described above are to be followed.

		If as of any day on which the last reported sale price of the Fund's shares on the New York Stock Exchange is required to be determined pursuant to this plan, no sales of the shares are reported on that exchange, the mean of the bid prices and of the asked prices on that exchange as of the time of the close of trading on the exchange will be substituted.

		No certificates will be issued representing fractional shares, nor will The Bank of New York purchase fractional shares in the market. The Bank of New York will send to all registered holders of common stock that do not participate in the Fund's dividend reinvestment plan certificates for all shares of common stock purchased or issued pursuant to the capital gains distribution plan and cash in lieu of fractional shares of common stock.

		The Fund may change, suspend or terminate the plan at any time upon mailing a notice to participants.

		(e) Anti-takeover provisions of charter and bylaws. The Fund's charter includes provisions that could have the effect of limiting the ability of other entities or persons to acquire control of the Fund or to change the composition of its board of directors and could have the effect of depriving shareholders of an opportunity to sell their shares at a premium over prevailing market prices by discouraging a third party from seeking to obtain control of the Fund. The board of directors is divided into three classes, each having a term of three years. At each annual meeting of shareholders, the term of one class will expire. This provision could delay for up to two years the replacement of a majority of the board of directors. A director may be removed from office only by vote of the holders of at least 75% of the shares of preferred stock or of common stock, as the case may be, entitled to be voted on the matter.

		The Fund's charter requires the favorable vote of the holders of at least 75% of the shares of preferred stock and common stock of the Fund entitled to be voted on the matter, voting together as a single class, to approve, adopt or authorize the following:

		(i) a merger or consolidation of the Fund with another corporation,

		(ii) a sale of all or substantially all of the Fund's assets (other than in the regular course of the Fund's investment activities), or

		(iii) a liquidation or dissolution of the Fund, unless such action has been approved, adopted or authorized by the affirmative vote of two-thirds of the total number of directors fixed in accordance with the bylaws, in which case the affirmative vote of the holders of a majority of the outstanding shares of preferred stock and common stock entitled to be voted on the matter, voting together as a single class, is required.

		In addition, the holders of a majority of the outstanding shares of the preferred stock, voting separately as a class, would be required under the 1940 Act to adopt any plan of reorganization that would adversely affect the holders of the preferred stock.

		Finally, conversion of the Fund to an open-end investment company would require an amendment to the charter. Such an amendment would require the favorable vote of the holders of a majority of the shares of preferred stock and common stock entitled to be voted on the matter voting separately by class. At any time, the amendment would have to be declared advisable by the board of directors prior to its submission to shareholders. Shareholders of an open-end investment company may require the company to redeem their shares of common stock at any time (except in certain circumstances as authorized by or under the 1940 Act) at their net asset value, less such redemption charge, if any, as might be in effect at the time of a redemption. In addition, conversion to an open-end investment company would require redemption of all outstanding shares of the preferred stock.

		The board of directors has determined that the 75% voting requirements described above, which are greater than the minimum requirements under Maryland law or the 1940 Act, are in the best interests of shareholders generally. Reference should be made to the charter on file with the Securities and Exchange Commission (the "SEC") for the full text of these provisions.

	2.	Long-Term Debt.

		Not applicable.

	3.	General

		Not applicable.

	4.	Taxes. The Fund intends to continue to qualify as a regulated investment company under the Internal Revenue Code of 1986, as it has in each year since the inception of its operations, so as to be relieved of Federal income tax on net investment income and net capital gains distributed to shareholders.

		Dividends paid by the Fund from its ordinary income and distributions of the Fund's net realized short-term capital gains are taxable to shareholders as ordinary income. Under legislation enacted in 2003, ordinary income dividends shareholders receive may be taxed at the same rates as long-term capital gains. However, even if income received in the form of ordinary income dividends is taxed at the same rates as long-term capital gains, such income will not be considered long-term capital gains for other Federal income tax purposes. For example, a shareholder generally will not be permitted to offset ordinary income dividends with capital losses. Short-term capital gain distributions will continue to be taxed at ordinary income rates. So long as the Fund has capital loss carry forwards, distributions derived from capital gains in the Fund's portfolio may constitute ordinary income, rather than capital gains, to shareholders.

		Shareholders may be proportionately liable for taxes on income and gains of the Fund but shareholders not subject to tax on their income will not be required to pay tax on amounts distributed to them. The Fund will inform shareholders of the amount and nature of the income or gains. Dividends from ordinary income may be eligible for the dividends-received deduction available to corporate shareholders. Under its charter, the Fund is required to designate dividends paid on its preferred stock as qualifying for the dividends-received deduction to the extent such dividends do not exceed the Fund's qualifying income. In the event the Fund is required to allocate all of its qualifying income to dividends on the preferred stock, dividends payable on the common stock will not be eligible for the dividends-received deduction. Any distributions attributable to the Fund's net realized long-term capital gains are taxable to shareholders as long-term capital gains, regardless of the holding period of shares of the Fund. Under current law, the maximum tax rate on long-term capital gains available to non-corporate shareholders generally is 15%. Without future congressional action, the maximum tax rate on long-term capital gains would return to 20% in 2009, and the maximum tax rate on dividends would move to 35% in 2009 and 39.6% in 2011.

		The Fund intends to distribute substantially all its net investment income and net realized capital gains in the year earned or realized. A dividend reinvestment plan is available to all holders of common stock of the Fund. Under the dividend reinvestment plan, all cash distributions to participating shareholders are reinvested in additional shares of common stock. See Item 10.1(c).

Outstanding Securities

(1) Title of Class	(2) Amount Authorized	(3) Amount Held by the Fund or for its Account	(4) Amount Outstanding at 3/31/2004 Exclusive of Amount Shown Under (3)

Common, $.001 par value	250,000,000	-0-	219,454,216
Preferred, $.001 par value	100,000,000	-0-	5,000

6. Securities Ratings.

Not applicable.

Item 11. Defaults and Arrears on Senior Securities

Not applicable.

Item 12. Legal Proceedings

There are no pending legal proceedings to which the Fund, any subsidiary of the Fund, or the Adviser is a party.

Item 13. Table of Contents of the Statement of Additional Information

Not applicable.

PART B INFORMATION REQUIRED IN A STATEMENT OF ADDITIONAL INFORMATION

Item 14. Cover Page

Not applicable.

Item 15. Table of Contents

Not applicable.

Item 16. General Information and History

During the past five years, the Fund has not engaged in any business other than that of an investment company and has not been the subject of any bankruptcy, receivership or similar proceedings, or any other material reorganization, readjustment or succession. The Fund's name was changed from Duff & Phelps Utilities Income Inc. on April 23, 2002.

Item 17. Investment Objective and Policies

1. See Item 8.2.

2. See Item 8.2.

3. See Item 8.2.

4. The Fund's portfolio turnover rate was 242.69% in 2003, 197.27% in 2002 and 213.48% in 2001. The portfolio turnover rate tends to be correlated with the level of the Fund's dividend captures, which decreased in 2002 relative to 2001 and increased in 2003 relative to 2002. The Fund expects to lower its turnover rate in 2004 by reducing the level of dividend captures and utilizing investment gains within the portfolio. See Item 8.3, "Risk Factors–Dividend Captures."

Item 18. Management

1. Set forth below are the names and certain biographical information about the directors and officers of the Fund. Except as indicated in the table, directors are elected by the holders of the Fund's common stock. The officers are elected at the annual meeting of the board of directors of the Fund. Except as indicated in footnote (7) to the table, no director oversees any other portfolios in the fund complex to which the Fund belongs.


Name, Address and Age	Position(s) Held With the Fund, Length of Time Served and Term of Office		Principal Occupation(s) During Past 5 Years and Other Affiliations

*Interested Director*

Claire V. Hansen (1)(2)55 East Monroe Street Chicago, Illinois 60603 Age: 78	Chairman and director since January 1987. Term expires in 2005.		Senior Advisor to the Board of Directors, Phoenix Investment Partners, Ltd. since November 1995; President and Chief Executive Officer, DNP Select Income Fund Inc. January 2000–February 2001; Senior Advisor to the Board of Directors, Duff & Phelps Corporation, 1988–November 1995 (Chairman of the Board, 1987–1988; Chairman of the Board and Chief Executive Officer prior thereto); Chairman of the Board, Duff & Phelps Investment Management Co., 1985–1987

*Independent Directors*

Stewart E. Conner (5) 500 West Jefferson St. Louisville, Kentucky 40202 Age: 62	Director since April 2004. Term expires in 2007		Attorney, Wyatt Tarrant & Combs LLP since 1966 (Chairman, Executive Committee since 2000, Managing Partner 1988-2000); Director, Hilliard Lyons Growth Fund, Inc.

Connie K. Duckworth (3)(5) 77 Stone Gate Lane Lake Forest, Illinois 60045 Age: 49	Director since April 2002. Term expires in 2005.		Partner, Eight Wings Enterprises (investor in early-stage businesses) since December 2001; Advisory Director, Goldman, Sachs & Company, December 2000-December 2001 (Managing Director, December 1996-December 2000, Partner 1990-1996, Chief Operating Officer of Firmwide Diversity Committee 1990-1995); Member, Circle Financial Group LLC (private investment company); Chair (2003), Policyowners' Examining Committee, Northwestern Mutual Life Insurance Company; Founder and President, Arzu, Inc. (nonprofit corporation created to raise awareness of Afghan women through sale of homemade rugs)

Robert J. Genetski (3)(6) 195 North Harbor Drive Chicago, Illinois 60601 Age: 61	Director since April 2001. Term expires in 2007.		President, Robert Genetski & Associates, Inc. (economic and financial consulting firm) since 1991; Senior Managing Director, Chicago Capital, Inc. (financial services firm) 1995-2001; former Senior Vice President and Chief Economist, Harris Trust & Savings Bank; author of several books; regular contributor to the Nikkei Financial Daily

Francis E. Jeffries (2)(4)(7) 8477 Bay Colony Drive Naples, Florida 34108 Age: 73	Director since January 1987. Term expires in 2007. Vice Chairman since April 2004.		Oversees 28 portfolios in the fund complex to which the Fund belongs; Chairman of the Board, DTF Tax Free Income Inc. and Duff & Phelps Utility and Corporate Bond Trust Inc. (the "DTF and DUC Funds") since September 1991 and November 1992, respectively (President, January 2000–February 2004), Chairman, Phoenix Investment Partners, Ltd. November 1995–May 1997; Chairman and Chief Executive Officer, Duff & Phelps Corporation, June 1993–November 1995 (President and Chief Executive Officer, January 1992–June 1993); Chairman of the Board, Duff & Phelps Investment Management Co. 1988–1993; Director, The Empire District Electric Company

Nancy Lampton (4)(5)(6) 3 Riverfront Plaza Louisville, Kentucky 40202 Age: 61	Director since October 1994. Term expires in 2006.		Chairman and Chief Executive Officer, Hardscuffle Inc. (insurance holding company) since January 2000; Chairman and Chief Executive Officer, American Life and Accident Insurance Company of Kentucky since 1971; Director, Constellation Energy Group, Inc. (public utility holding company), Advisor, Thorium Power Corporation (designer of non-proliferative fuel for nuclear energy needs)

Christian H. Poindexter (3)(4) 1997 Annapolis Exchange Pkwy. Annapolis, Maryland 21401 Age: 65	Director since May 2003. Term expires in 2006.		Retired Chairman and Chief Executive Officer, Constellation Energy Group, Inc. (public utility holding company) (Executive Committee Chairman, July 2002–March 2003; Chairman of the Board, April 1999–July 2002; Chief Executive Officer, April 1999–October 2001; President, April 1999–October 2000); Chairman, Baltimore Gas and Electric Company, January 1993–July 2002 (Chief Executive Officer, January 1993–July 2000; President, March 1998–October 2000; Director, 1988–2003); Director, Mercantile Bankshares Corporation (bank holding company); Director, The Baltimore Life Insurance Company

Carl F. Pollard (2)(3) 10500 W. U.S. Hwy 42 Goshen, Kentucky 40026 Age: 65	Director since April 2002. Term expires in 2005.		Owner, Hermitage Farm L.L.C. (Thoroughbred breeding) since January 1995; Chairman, Columbia Healthcare Corporation 1993-1994; Chairman and Chief Executive Officer, Galen Health Care, Inc. March-August 1993; President and Chief Operating Officer, Humana Inc. 1991-1993 (previously Senior Executive Vice President, Executive Vice President and Chief Financial Officer); Chairman and Director, Churchill Downs Incorporated; Director, Breeders' Cup Limited

David J. Vitale (2)(5) 141 West Jackson Boulevard Chicago, Illinois 60604 Age: 57	Director since April 2000. Term expires in 2006.		Chief Administrative Officer, Chicago Public Schools since April 2003; Private investor November 2002–April 2003; President and Chief Executive Officer, Board of Trade of the City of Chicago, Inc., March 2001–November 2002; Retired executive 1999–2001; Vice Chairman and Director, Bank One Corporation, 1998–1999; Vice Chairman and Director, First Chicago NBD Corporation, and President, The First National Bank of Chicago, 1995–1998; Vice Chairman, First Chicago Corporation and The First National Bank of Chicago, 1993–1998 (Director, 1992–1998; Executive Vice President, 1986–1993); Director, Ariel Capital Management, Inc., Ark Investment Management and Wheels, Inc.

*Officers of the Fund (other than the Chairman, for whom see above)*

Nathan I. Partain 55 East Monroe Street Chicago, Illinois 60603 Age: 47	President and Chief Executive Officer since February 2001 (Chief Investment Officer since January 1998, Executive Vice President April 1998-February 2001, Senior Vice President January 1997-April 1998, Assistant Secretary January 1997-February 2001).	President, Duff & Phelps Utility and Corporate Bond Trust Inc. and DTF Tax Free Income Inc. since February 2004; Executive Vice President, Duff & Phelps Investment Management Co. since January 1997; Director of Utility Research, Phoenix Investment Partners, Ltd., 1989–1996 (Director of Equity Research, 1993–1996 and Director of Fixed Income Research, 1993); Director, Otter Tail Corporation

T. Brooks Beittel 55 East Monroe Street Chicago, Illinois 60603 Age: 54	Secretary and Senior Vice President since January 1995 (Treasurer January 1995-September 2002).	Senior Vice President, Duff & Phelps Investment Management Co. since 1993 (Vice President 1987–1993)

Michael Schatt 55 East Monroe Street Chicago, Illinois 60603 Age: 57	Senior Vice President since April 1998 (Vice President January 1997-April 1998.	Senior Vice President, Duff & Phelps Investment Management Co. since January 1997; Managing Director, Phoenix Investment Partners, Ltd., 1994–1996

Joseph C. Curry, Jr. Hilliard Lyons Center Louisville, Kentucky 40202 Age: 59	Treasurer since September 2002; Vice President since April 1988.	Senior Vice President, J.J.B. Hilliard, W.L. Lyons, Inc. since 1994 (Vice President 1982–1994); Vice President Hilliard Lyons Trust Company; President, Hilliard-Lyons Government Fund, Inc.; Vice President and Treasurer, Hilliard Lyons Growth Fund, Inc.; Vice President and Assistant Treasurer, Senbanc Fund

Joyce B. Riegel 55 East Monroe Street Chicago, Illinois 60603 Age: 49	Chief Compliance Officer since February 2004.	Chief Compliance Officer, Duff & Phelps Utility and Corporate Bond Trust Inc. and DTF Tax Free Income Inc. since August 2003; Chief Compliance Officer, Duff & Phelps Investment Management Co. since August 2002; Vice President and Chief Compliance Officer, Stein Roe Investment Counsel LLC January 2001–August 2002; Vice President and Compliance Officer, Stein Roe & Farnham Incorporated July 1996–December 2000

Dianna P. Wengler Hilliard Lyons Center Louisville, Kentucky 40202 Age: 43	Assistant Vice President since April 2004; Assistant Secretary since April 1988.	Vice President, J.J.B. Hilliard, W.L. Lyons, Inc. since 1990; Vice President, Hilliard-Lyons Government Fund, Inc.; Assistant Secretary, Hilliard Lyons Growth Fund, Inc.

_______________________________________________________

(1)	Mr. Hansen is deemed to be an "interested person" of the Fund (as defined in the 1940 Act) because of his positions with the Fund and with Phoenix Investment Partners (parent company of the Adviser).

(2)	Member of the executive committee of the board of directors, which has authority, with certain exceptions, to exercise the powers of the board of directors between board meetings. The executive committee met once during 2003.

(3)	Member of the audit committee of the board of directors, which makes recommendations regarding the selection of the Fund's independent public accountants and meets with representatives of the accountants to determine the scope of and review the results of each audit. The audit committee met twice during 2003.

(4)	Member of the nominating/corporate governance committee of the board of directors, which selects nominees for election as directors, recommends individuals to be appointed by the board as Fund officers and members of board committees and makes recommendations regarding other Fund governance and board administration matters. The nominating/corporate governance committee met three times during 2003. The committee will consider nominees recommended by shareholders. Shareholders wishing to recommend candidates to the committee should submit such recommendations to the Secretary of the Fund, 55 East Monroe Street, Suite 3600, Chicago, Illinois 60603. The Secretary of the Fund will forward the recommendations to the nominating/corporate governance committee for consideration.

(5)	Member of the contracts committee of the board of directors, which makes recommendations regarding the Fund's contractual arrangements for investment management and administrative services, including the terms and conditions of such contracts. The contracts committee met three times during 2003.

(6)	Director elected by holders of preferred stock.

(7)	Although the Fund does not hold itself out as a member of a fund complex, applicable SEC rules define the fund complex to which the Fund belongs to include all registered investment companies that have an investment adviser that is an "affiliated person" (as defined in the 1940 Act) of the Adviser.

	2.					Included in Item 18.1.

	3.				Not applicable.

	4.			Not applicable.

	5.			Included in Item 18.1.

	6.		Included in Item 18.1.

	7.	The following table provides certain information relating to the equity securities beneficially owned, as of December 31, 2003, by each director (i) in the Fund and (ii) on an aggregate basis, in any registered investment companies overseen by the director within the same family of investment companies as the Fund.

Name of Director	Dollar Range of Equity Securities in the Fund	Aggregate Dollar Range of Equity Securities in All Funds Overseen or to be Overseen by Director or Nominee in Family of Investment Companies

*Interested Director*

Claire V. Hansen	over $100,000	over $100,000

*Independent Directors*

Stewart E. Conner	none (1)	none (1)
Connie K. Duckworth	over $100,000	over $100,000
Robert J. Genetski	over $100,000	over $100,000
Francis E. Jeffries	over $100,000	over $100,000
Nancy Lampton	over $100,000	over $100,000
Christian H. Poindexter	over $100,000	over $100,000
Carl F. Pollard	over $100,000	over $100,000
David J. Vitale	$10,001-$50,000	$10,001-$50,000

(1)	Mr. Conner purchased equity shares in the Fund in February 2004. As a result of this purchase the dollar range of equity securities owned by him in the Fund (and in all registered investment companies overseen by him within the same family of investment companies as the Fund) became $50,001-$100,000.

	8.	As of December 31, 2003, none of the foregoing directors, or their immediate family members, owned any securities of the Adviser or any person (other than a registered investment company) directly or indirectly controlling, controlled by or under common control with the Adviser.

	9.	Not applicable.

	10.	Not applicable.

	11.	Not applicable.

	12.	Francis E. Jeffries, a director of the Fund, is also a director and chairman of the board of the DTF and DUC Funds and served as President of the DTF and DUC Funds from January 2000 to February 2004. Another director of the DTF and DUC Funds is Philip R. McLoughlin, who has served in that capacity since 1996 and has also served as an officer of parent companies of the Adviser (Chief Executive Officer of Phoenix Investment Partners from 1995 to 2002 and Executive Vice President and Chief Investment Officer of The Phoenix Companies, Inc. and its predecessor company from 1988 to 2002).

	13.	Approval of Advisory Agreement. Each year, the board of directors of the Fund, including a majority of the directors who are not interested persons of the Fund or the Adviser voting separately as a class, is required to approve the renewal of the Advisory Agreement. The contracts committee of the board of directors, which is comprised solely of independent directors, requests and evaluates, and the Adviser furnishes, such information as the committee determines to be reasonably necessary to evaluate the terms of the Advisory Agreement. The contracts committee also retains an independent consultant on an annual basis to provide detailed comparative data regarding the Adviser's fees and expense ratios and the Fund's investment performance. The contracts committee then presents a recommendation to the board of directors regarding renewal of the Advisory Agreement.

		In arriving at their decision to renew the current Advisory Agreement, the directors reviewed the foregoing information and took into account all factors that they deemed relevant to the best interests of the shareholders of the Fund. Such factors included the following: (i) the nature, quality and extent of the services furnished to the Fund by the Adviser; (ii) fees paid by other mutual funds for similar services; (iii) the profitability to the Adviser of its relationship with the Fund; (iv) the continuation of appropriate incentives to assure that the Adviser will be able to continue to furnish high-quality services to the Fund; (v) the capabilities of the team of investment professionals employed by the Adviser who perform services for the Fund; (vi) the necessity of the Adviser maintaining and enhancing its ability to attract and retain capable personnel to serve the Fund; (vii) the investment performance over time of the Fund compared to various market indices and other mutual funds; (viii) the extent to which the Fund's stock trades at a premium or a discount to net asset value; (ix) the benefits of any economies of scale that may be available to the Adviser; and (x) the direct and indirect benefits the Adviser receives from its relationship with the Fund, including brokerage and soft dollar arrangements (see description in Item 21.3 below).

		In comparing the Fund's expenses and investment performance to those of other mutual funds, the directors took note of the fact that until recently there have been no closed-end income-oriented funds with a utilities and REIT investment focus, an equity and fixed-income asset mix and an asset level and leverage policy comparable to the Fund. While expressly declining to use investment performance as the sole, or even the primary, measure of the quality of the Adviser's services, the directors noted that the Fund's investment performance during 2003 had enabled the Fund to pay all of its regular monthly dividends in 2003. The directors also viewed the fact that the Fund's stock traded at an average premium of 40.46% to net asset value during 2003 as evidence that investors take a favorable view of the extent to which the Fund has been meeting its primary objective of providing current income for shareholders. With respect to investment personnel, the directors considered the fact that the specific individuals who manage the Fund's portfolio bring a significant depth of experience to their jobs, have worked together for many years and are well respected in the industry. With respect to expenses, the directors noted that the management fees paid by the Fund were at or below the median levels paid by other leveraged closed-end domestic equity funds. It should be emphasized that, in arriving at their decision, the directors did not single out any one factor or group of factors as being more important than other factors. Rather, the directors considered all factors together in light of the totality of circumstances presently facing the Fund, recognizing that different circumstances might lead them to weigh the various factors differently when considering the best interests of the Fund and its shareholders.

		Based on the foregoing considerations, the board of directors of the Fund, including a majority of the directors who are not interested persons of the Fund or the Adviser voting separately as a class, determined that the fees payable to the Adviser under the Advisory Agreement were fair and reasonable to the Fund and that the renewal of the Advisory Agreement for a one-year period ending on April 30, 2005 was in the best interests of the Fund and its shareholders.

	14.	The following table shows the compensation paid by the Fund to the Fund's current directors during 2003:

COMPENSATION TABLE (1)(2)

Name of Director		Aggregate Compensation from the Fund

*Interested Director*

Claire V. Hansen………………………………………...		$ 0

*Independent Directors*

Stewart E. Conner………………………………………..		0
Connie K. Duckworth……………………………………		53,500
Robert J. Genetski……………………………………….		52,000
Francis E. Jeffries (2)……………………………………		43,000
Nancy Lampton………………………………………….		42,500
Christian H. Poindexter………………………………….		25,305
Carl F. Pollard…………………………………………...		38,000
David J. Vitale…………………………………………...		57,000

_______________________________________

(1)	Each director not affiliated with the Adviser receives an annual fee of $25,000 (and an additional $5,000 if the director serves as chairman of a committee of the board of directors) plus an attendance fee of $2,000 for each meeting of the board of directors and $1,500 for each meeting of a committee of the board of directors attended in person or by telephone. Directors and officers affiliated with the Adviser or the Administrator receive no compensation from the Fund for their services as such. In addition to the amounts shown in the table above, all directors and officers who are not affiliated with the Adviser or the Administrator are reimbursed for the expenses incurred by them in connection with their attendance at a meeting of the board of directors or a committee of the board of directors. The Fund does not have a pension or retirement plan applicable to directors or officers of the Fund.

(2)	During 2003, Mr. Jeffries received aggregate compensation of $149,000 for service as a director of the Fund and as a director or trustee of 27 other investment companies in the same fund complex as the Fund. No other director received compensation for service as a director of any other investment company in the same fund complex as the Fund.

	15.		Codes of Ethics. Each of the Fund and the Adviser has adopted an Amended and Restated Code of Ethics (collectively, the "Codes") under Rule 17j-1 of the 1940 Act. The Codes impose significant restrictions on the ability of personnel subject to the Codes to engage in personal securities transactions. Among other things, the Codes generally prohibit covered personnel from knowingly buying or selling securities (except for mutual funds, U.S. government securities and money market instruments) that are being purchased, sold or considered for purchase or sale by the Fund unless the proposed purchases are approved in advance by the Adviser's compliance officer. The Codes also contain certain reporting requirements and compliance procedures. The Codes can be reviewed and copied at the Public Reference Room of the SEC in Washington, D.C. Information on the operation of the Public Reference Room may be obtained by calling the SEC at 1-202-942-8090. The Codes are also available at the EDGAR Database on the SEC's Internet site at http://www.sec.gov. Copies of the Codes may also be obtained, after paying a duplicating fee, by electronic request at the following E-mail address: publicinfo@sec.gov, or by writing the SEC's Public Reference Section, Washington, D.C. 20549-0102. The SEC file number for documents filed by the Fund under the 1940 Act is 811-4915.

	16.		Proxy Voting Policies and Procedures. The Fund has adopted proxy voting policies and procedures. The following is a summary description of those policies and procedures, the full text of which is available on the Fund's website at http://www.dnpselectincome.com.

			Subject to the right of the board of directors to give the Adviser written instructions as to the voting or non-voting of proxies on any matter presenting an actual or perceived conflict of interest as described below, the Fund has delegated the voting of proxies with respect to securities owned by it to the Adviser. The Adviser may delegate its proxy voting responsibilities to a proxy committee established from time to time by the Adviser and may engage one or more qualified, independent organizations to vote proxies on behalf of the Fund, subject in each case to compliance with these policies and procedures.

			It is the intention of the Fund to exercise stock ownership rights in portfolio holdings in a manner that is reasonably anticipated to further the best economic interests of shareholders of the Fund. Accordingly, the Fund or its delegate(s) endeavors to analyze and vote all proxies that are considered likely to have financial implications, and, where appropriate, to participate in corporate governance, shareholder proposals, management communications and legal proceedings.

			The Adviser will generally vote in favor of management recommendations on routine matters. The Adviser will analyze and vote on non-routine matters, including the adoption of anti-takeover measures, proxy contests for control, contested elections of directors, corporate governance matters and executive compensation matters, on a case-by-case basis, taking into account factors appropriate to each such matter. The Adviser will generally vote against shareholder proposals on social issues, except where the Adviser determines that a different position would be in the clear economic interests of the Fund and its shareholders. The Adviser may abstain from voting when it concludes that the effect on shareholders' economic interests or the value of the portfolio holding is indeterminable or insignificant.

			In exercising its voting discretion, the Adviser will seek to avoid any actual or perceived conflicts of interest between the interests of Fund shareholders, on the one hand, and those of the Adviser or any affiliated person of the Fund or the Adviser, on the other hand. The Adviser will notify the board of directors of the Fund promptly after becoming aware that any actual or potential conflict of interest exists, indicating how the Adviser proposes to vote on the matter and its reasons for doing so. The board of directors may decide to (i) vote pursuant to the recommendation of the delegate, (ii) abstain from voting or (iii) rely on the recommendations of an established, independent third party with qualifications to vote proxies, such as Institutional Shareholder Services. The Adviser may not waive any conflict of interest or vote any conflicted proxies without the prior written approval of the board of directors or its duly authorized representative.

Item 19. Control Persons and Principal Holders of Securities

	1.		The Fund does not consider that any person "controls" the Fund within the meaning of this item. For information concerning the Fund's officers and directors, see Item 18.

	2.		No person is known by the Fund to own of record or beneficially five percent or more of any class of the Fund's outstanding equity securities.

	3.		As of December 31, 2003, the officers and directors of the Fund owned in the aggregate 277,359 shares of Common Stock, representing less than 1% of the Fund's outstanding Common Stock.

Item 20. Investment Advisory and Other Services

	1.		The Adviser is a wholly-owned subsidiary of Phoenix Investment Partners, which is an indirect, wholly-owned subsidiary of The Phoenix Companies, Inc. Phoenix Investment Partners and its subsidiaries provide investment management services to institutional and private clients and to the life insurance subsidiaries of The Phoenix Companies, Inc.

			See Item 18 for the names and capacities of affiliated persons of the Fund who are also affiliated persons of the Adviser.

			For a discussion of the method of calculating the advisory fee under the Advisory Agreement, see Item 9.1(b). The investment advisory fees paid by the Fund totaled $13,069,523 in 2003, $13,776,089 in 2002 and $15,284,267 in 2001.

	2.		See Item 9.1(b) for a discussion of the Service Agreement.

	3.		No fees, expenses or costs of the Fund were paid by persons other than the Adviser or the Fund.

	4.	See Item 9.1(d) for a discussion of the Administration Agreement. The administrative fees paid by the Fund totaled $3,363,980 in 2003, $3,505,218 in 2002 and $3,806,813 in 2001.

	5.	Not applicable.

	6.	See Item 9.1(e) for information about the Fund's custodian.

	7.	The Fund's independent public accountant is Ernst & Young LLP, 233 South Wacker Drive, 16th Floor, Chicago, Illinois 60606. Ernst & Young LLP performs the audit of the Fund's annual financial statements and provides other audit-related and tax services to the Fund as pre-approved by the Fund's audit committee.

	8.	Not applicable.

Item 21. Brokerage Allocation and Other Practices

	1. The Adviser has discretion to select brokers and dealers to execute portfolio transactions initiated by the Adviser. The Fund paid brokerage commissions in the aggregate amount of $8,550,524, $8,486,229 and $9,015,619 during 2003, 2002 and 2001, respectively, not including the gross underwriting spread on securities purchased in underwritten public offerings.

	2. The Fund did not pay any brokerage commissions during 2003, 2002 or 2001 to any broker that (1) is an affiliated person of the Fund, (2) is an affiliated person of an affiliated person of the Fund or (3) has an affiliated person that is an affiliated person of the Fund or the Adviser.

	3. In selecting brokers or dealers to execute portfolio transactions and in evaluating the best net price and execution available, the Adviser is authorized to consider "brokerage and research services" (as those terms are defined in Section 28(e) of the Securities Exchange Act of 1934), statistical quotations, specifically the quotations necessary to determine the Fund's net asset value, and other information provided to the Fund and/or to the Adviser (or their affiliates). The Adviser is also authorized to cause the Fund to pay to a broker or dealer who provides such brokerage and research services a commission for executing a portfolio transaction which is in excess of the amount of commission another broker or dealer would have charged for effecting that transaction. The Adviser must determine in good faith, however, that such commission was reasonable in relation to the value of the brokerage and research services provided, viewed in terms of that particular transaction or in terms of all the accounts over which the Adviser exercises investment discretion. It is possible that certain of the services received by the Adviser attributable to a particular transaction will benefit one or more other accounts for which investment discretion is exercised by the Adviser.

	4. Neither the Fund nor the Adviser, during the last fiscal year, pursuant to an agreement or understanding with a broker or otherwise through an internal allocation procedure, directed the Fund's brokerage transactions to a broker or brokers because of research services.

	5. The Fund has not acquired during its most recent fiscal year securities of its regular brokers or dealers as defined in Rule 10b-1 under the 1940 Act, or their parents.

Item 22. Tax Status

The Fund intends to continue to qualify as a regulated investment company under the Internal Revenue Code of 1986, as it has in each year since the inception of its operations, so as to be relieved of Federal income tax on net investment income and net capital gains distributed to shareholders.

Dividends paid by the Fund from its ordinary income and distributions of the Fund's net realized short-term capital gains are taxable to shareholders as ordinary income. Under legislation enacted in 2003, ordinary income dividends shareholders receive may be taxed at the same rates as long-term capital gains. However, even if income received in the form of ordinary income dividends is taxed at the same rates as long-term capital gains, such income will not be considered long-term capital gains for other Federal income tax purposes. For example, a shareholder generally will not be permitted to offset ordinary income dividends with capital losses. Short-term capital gain distributions will continue to be taxed at ordinary income rates. So long as the Fund has capital loss carry forwards, distributions derived from capital gains in the Fund's portfolio may constitute ordinary income, rather than capital gains, to shareholders.

Dividends from ordinary income may be eligible for the dividends-received deduction available to corporate shareholders. Under its charter, the Fund is required to designate dividends paid on its preferred stock as qualifying for the dividends-received deduction to the extent such dividends do not exceed the Fund's qualifying income. In the event the Fund is required to allocate all of its qualifying income to dividends on the preferred stock, dividends payable on the common stock will not be eligible for the dividends-received deduction. Any distributions attributable to the Fund's net realized long-term capital gains are taxable to shareholders as long-term capital gains, regardless of the holding period of shares of the Fund. Under current law, the maximum tax rate on long-term capital gains available to non-corporate shareholders generally is 15%. Without future congressional action, the maximum tax rate on long-term capital gains would return to 20% in 2009, and the maximum tax rate on dividends would move to 35% in 2009 and 39.6% in 2011.

The Fund intends to distribute substantially all its net investment income and net realized capital gains in the year earned or realized. A dividend reinvestment plan is available to all holders of common stock of the Fund. Under the dividend reinvestment plan, all cash distributions to participating shareholders are reinvested in additional shares of common stock. See Item 10.1(c).

As of December 31, 2003, the Fund had tax capital loss carry forwards of $387,291,560, of which $49,518,674 will expire in 2007, $126,699,370 will expire in 2010 and $211,073,516 will expire in 2011.

Item 23. Financial Statements

The financial statements listed below are incorporated herein by reference from the Fund's Annual Report to Shareholders for the year ended December 31, 2003 as filed on Form N-CSR with the Securities and Exchange Commission on March 1, 2004 (no. 811-4915). All other portions of the Annual Report to Shareholders are not incorporated herein by reference and are not part of the Registration Statement. A copy of the Annual Report to Shareholders may be obtained without charge by writing to the Fund at its address at 55 East Monroe Street, Chicago, Illinois 60603 or by calling the Administrator toll-free at 888-878-7845.

- Report of independent public accountants

- Schedule of Investments at December 31, 2003

- Balance Sheet at December 31, 2003

- Statement of Operations for the year ended December 31, 2003

- Statement of Changes in Net Assets for the years ended December 31, 2003 and 2002

- Statement of Cash Flows for the year ended December 31, 2003

- Notes to Financial Statements

- Financial Highlights - Selected Per Share Data and Ratios

PART C: OTHER INFORMATION

Item 24. Financial Statements and Exhibits

1. Financial Statements

In Part B:

Report of independent public accountants

Schedule of Investments at December 31, 2003

Balance Sheet at December 31, 2003

Statement of Operations for the year ended December 31, 2003

Statement of Changes in Net Assets for the years ended December 31, 2003 and 2002

Statement of Cash Flows for the year ended December 31, 2003

Notes to Financial Statements

Financial Highlights - Selected Per Share Data and Ratios

In Part C:

None

2. Exhibits

		a.1		Articles of Incorporation

		a.2		Amendment to Articles of Incorporation

		a.3		Second Amendment to Articles of Incorporation

		a.4		Form of Articles Supplementary creating Remarketed Preferred Stock, Series A, B, C, D and E

		a.5		Form of Articles Supplementary creating Remarketed Preferred Stock, Series I

		a.6		Third Amendment to Articles of Incorporation

		a.7		Fourth Amendment to Articles of Incorporation

		a.8		Fifth Amendment to Articles of Incorporation

		a.9		Sixth Amendment to Articles of Incorporation

		a.10		Seventh Amendment to Articles of Incorporation

		b.		Bylaws (as amended through February 20, 2004)

		c.		None

		d.1		Specimen common stock certificate (Incorporated by reference from Registrant's registration statement on Form N-2, no. 33-10421)

		d.2		Form of certificate of Remarketed Preferred Stock, Series A (Incorporated by reference from pre-effective amendment no. 2 to Registrant's registration statement on Form N-2, no. 33-22933)

		d.3		Form of certificate of Remarketed Preferred Stock, Series B (Incorporated by reference from pre-effective amendment no. 1 to Registrant's registration statement on Form N-2, no. 33-24101)

		d.4		Form of certificate of Remarketed Preferred Stock, Series C (Incorporated by reference from pre-effective amendment no. 1 to Registrant's registration statement on Form N-2, no. 33-24100)

		d.5		Form of certificate of Remarketed Preferred Stock, Series D (Incorporated by reference from pre-effective amendment no. 1 to Registrant's registration statement on Form N-2, no. 33-24102)

		d.6		Form of certificate of Remarketed Preferred Stock, Series E (Incorporated by reference from pre-effective amendment no. 1 to Registrant's registration statement on Form N-2, no. 33-24099)

		d.7		Form of certificate of Remarketed Preferred Stock, Series I (Incorporated by reference from pre-effective amendment no. 2 to Registrant's registration statement on Form N-2, no. 33-22933)

		e.		Document setting forth the terms of Registrant's dividend reinvestment plan

		f.		None

		g.1		Investment Advisory Agreement (Incorporated by reference from post-effective amendment no. 39 to Registrant's registration statement under the Investment Company Act of 1940 on Form N-2, no. 811-4915)

		g.2		Service Agreement (Incorporated by reference from post-effective amendment no. 39 to Registrant's registration statement under the Investment Company Act of 1940 on Form N-2, no. 811-4915)

		g.3		Administration Agreement (Incorporated by reference from post-effective amendment no. 39 to Registrant's registration statement under the Investment Company Act of 1940 on Form N-2, no. 811-4915)

		h.		Not applicable

		i.		Not applicable

		j.1		Custody Agreement (Incorporated by reference from post-effective amendment no. 45 to Registrant's registration statement under the Investment Company Act of 1940 on Form N-2, no. 811-4915)

		j.2		Foreign Custody Manager Agreement (Incorporated by reference from post-effective amendment no. 45 to Registrant's registration statement under the Investment Company Act of 1940 on Form N-2, no. 811-4915)

		k.1		Fund Accounting Agreement (Incorporated by reference from post-effective amendment no. 45 to Registrant's registration statement under the Investment Company Act of 1940 on Form N-2, no. 811-4915)

		k.2		Form of Remarketing Agreement (Incorporated by reference from exhibit k.3 to pre-effective amendment no. 3 to Registrant's registration statement on Form N-2, no. 33-22933)

		k.3		Form of Paying Agent Agreement (Incorporated by reference from exhibit k.4 to pre-effective amendment no. 3 to Registrant's registration statement on Form N-2, no. 33-22933)

		k.4		Credit Agreement

		k.5		Depositary Agreement

		k.6		Letter Amendment to Depositary Agreement

		k.7		Second Letter Amendment to Depositary Agreement

		k.8		Placement Agency Agreement

		k.9		Letter Amendment to Placement Agency Agreement

		l.		Not applicable

		m.		Not applicable

		n.		Not applicable

		o.		Not applicable

		p.		Subscription Agreement for initial capital (Incorporated by reference from Registrant's registration statement on Form N-2, no. 33-10421)

		q.		Not applicable

		r.1		Amended and Restated Code of Ethics of Registrant

		r.2		Amended and Restated Code of Ethics of Duff & Phelps Investment Management Co. (investment adviser to Registrant)

Item 25. Marketing Arrangements

Not applicable.

Item 26. Other Expenses of Issuance and Distribution

Not applicable.

Item 27. Persons Controlled by or Under Common Control

The Fund does not consider that it is controlled, directly or indirectly, by any person. The information in Item 20 is incorporated herein by reference.

Item 28. Number of Holders of Securities

Title of Class		Number of Record Holders March 31, 2004

Common Stock, $.001 par value		25,554

Preferred Stock, $.001 par value		1

Item 29. Indemnification

Section 2-418 of the General Corporation Law of Maryland authorizes the indemnification of directors and officers of Maryland corporations under specified circumstances.

Article Ninth of the Registrant's Articles of Incorporation (Exhibit a.1 to this registration statement) provides that the Registrant shall indemnify its directors and officers under specified circumstances; the provision contains the exclusion required by section 17(h) of the Investment Company Act of 1940.

Insofar as indemnification for liabilities arising under the Securities Act of 1933 (the "1933 Act") may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the 1933 Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer or controlling person in connection with the securities being registered), the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the 1933 Act and will be governed by the final adjudication of such issue.

The Registrant, its directors and officers, the Adviser and persons affiliated with them are insured under a policy of insurance maintained by the Registrant and the Adviser, within the limits and subject to the limitations of the policy, against certain expenses in connection with the defense of actions, suits or proceedings and certain liabilities that might be imposed as a result of such actions, suits or proceedings, to which they are parties by reason of being or having been such directors or officers. The policy expressly excludes coverage for any director or officer whose personal dishonesty, fraudulent breach of trust, lack of good faith, or intention to deceive or defraud has been finally adjudicated or may be established or who willfully fails to act prudently.

Item 30. Business and Other Connections of Investment Adviser

Neither Duff & Phelps Investment Management Co., nor any of its directors or executive officers, has at any time during the past two years been engaged in any other business, profession, vocation or employment of a substantial nature either for its or his own account or in the capacity of director, officer, employee, partner or trustee, except as indicated in this Registration Statement.

Item 31. Location of Accounts and Records

All accounts, books and other documents required to be maintained by Section 31 (a) of the Investment Company Act of 1940 and the Rules promulgated thereunder are maintained at the offices of the Fund (55 East Monroe Street, Chicago, Illinois 60603), the Adviser, the Administrator and the Fund's custodian and transfer agents. See Items 9.1(b), 9.1(d) and 9.1(e) for the addresses of the Adviser, the Administrator and the Fund's custodian and transfer agents.

Item 32. Management Services

Not applicable.

Item 33. Undertakings

Not applicable.

SIGNATURE

Pursuant to the requirements of the Investment Company Act of 1940, the Registrant has duly caused this amendment to its registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Chicago, and State of Illinois, on April 22, 2004.

	DNP SELECT INCOME FUND INC.

	By: /s/ Nathan I. Partain
	Nathan I. Partain
	President and Chief Executive Officer

EXHIBIT INDEX

Exhibit No.	Description	Sequential Page No.

a.1	Articles of Incorporation

a.2	Amendment to Articles of Incorporation

a.3	Second Amendment to Articles of Incorporation

a.4	Form of Articles Supplementary creating Remarketed Preferred Stock, Series A, B, C, D and E

a.5	Form of Articles Supplementary creating Remarketed Preferred Stock, Series I

a.6	Third Amendment to Articles of Incorporation

a.7	Fourth Amendment to Articles of Incorporation

a.8	Fifth Amendment to Articles of Incorporation

a.9	Sixth Amendment to Articles of Incorporation

a.10	Seventh Amendment to Articles of Incorporation

b	Bylaws (as amended through February 20, 2004)

e	Document setting forth the terms of Registrant's dividend reinvestment plan

k.4	Credit Agreement

k.5	Depositary Agreement

k.6	Letter Amendment to Depositary Agreement

k.7	Second Letter Amendment to Depositary Agreement

k.8	Placement Agency Agreement

k.9	Letter Amendment to Placement Agency Agreement

r.1	Amended and Restated Code of Ethics of Registrant

r.2	Amended and Restated Code of Ethics of Duff & Phelps Investment Management Co. (investment adviser to Registrant)

EX-99.2A CHARTER 3 ex_a1.htm ex_a1

Exhibit a.1

DUFF & PHELPS SELECTED UTILITIES INC.

Articles of Incorporation

The undersigned, being a natural person and acting as incorporator, hereby adopts the following articles of incorporation for the purpose of forming a business corporation under and by virtue of the general laws of the State of Maryland.

FIRST. Incorporation. The incorporator is Cameron S. Avery, who is at least eighteen years of age and whose address is 70 West Madison Street, Suite 3200, Chicago, Illinois 60602. He is forming the corporation named in these articles of incorporation under the general laws of the State of Maryland.

SECOND. Name. The name of the corporation is Duff & Phelps Selected Utilities Inc.

THIRD. Purposes. The purposes for which the corporation is formed are:

1. To engage in the business of a closed-end management investment company.

2. To invest and reinvest in, to buy or otherwise acquire, to hold for investment or otherwise, and to sell or otherwise dispose of:

a. Securities of all kinds, however evidenced, and rights or warrants to acquire securities, of private and public companies, corporations, associations, trusts and other enterprises and organizations;

b. Obligations issued or guaranteed by national and state governments and their instrumentalities and subdivisions;

c. Deposits in banks, savings banks, trust companies and savings and loan associations;

d. Assets and interests other than securities or deposits.

FOURTH. Principal office and resident agent. The post office address of the principal office of the corporation in the State of Maryland is c/o The Corporation Trust Incorporated, 32 South Street, Baltimore, Maryland 21202. The name and post office address of the resident agent of the corporation in the State of Maryland is The Corporation Trust Incorporated, 32 South Street, Baltimore, Maryland 21202. The resident agent is a Maryland corporation.

FIFTH. Capital Stock.

A. Authorized stock. The total number of shares of capital stock that the corporation shall have authority to issue is 100,000,000 shares, all of one class called common stock, $.001 par value per share (common stock), having an aggregate par value of $100,000.

B. Sale of shares. The board of directors may authorize the sale and issuance from time to time of shares of common stock, whether now or hereafter authorized, for such consideration as the board of directors considers advisable, but not less than par value, subject to such limitations as may be set forth in these articles of incorporation, the bylaws, the General Laws of the State of Maryland, the Investment Company Act of 1940 and other applicable laws.

C. Fractional shares. Stock may be issued in fractions of whole shares, to which attach pro rata all of the rights of whole shares, including the right of voting and of receipt of dividends, except that there shall be no right of receipt of a certificate representing any fraction of a whole share.

D. No preemptive rights. No holder of shares of the corporation, whether now or hereafter authorized, shall be entitled as of right to acquire from the corporation any shares of the corporation, whether now or hereafter authorized.

SIXTH. Bylaws. The board of directors is authorized to adopt, alter and repeal the bylaws of the corporation, except to the extent that the bylaws provide otherwise.

SEVENTH. Board of Directors.

1. The total number of directors constituting the board of directors of the corporation shall be three, which number may be increased from time to time in accordance with the bylaws of the corporation but shall not be less than three. No decrease in the number of directors shall have the effect of shortening the term of any director then in office.

2. The names of the persons who will serve as the initial directors of the corporation are as follows:

                                                                                      Claire V. Hansen
                                                                                      Francis E. Jeffries
                                                                                      Robert D. Milne

3. Beginning with the first annual meeting of shareholders held after the initial public offering of the shares of the corporation ("the initial annual meeting"), the board of directors shall be divided into three classes: class I, class II, and class III. The terms of office of the classes of directors elected at the initial annual meeting shall expire at the times of the annual meetings of the stockholders as follows—class I in 1988, class II in 1989, and class III in 1990—or thereafter in each case when their respective successors are elected and qualified. At each subsequent annual election, the directors chosen to succeed those whose terms are expiring shall be identified as being of the same class as the directors whom they succeed, and shall be elected for a term expiring at the time of the third succeeding annual meeting of stockholders, or thereafter in each case when their respective successors are elected and qualified. The number of directorships shall be apportioned among the classes so as to maintain the classes as nearly equal in number as possible.

4. Any vacancy occurring in the board of directors may be filled by a majority of the directors in office. A new directorship resulting from an increase in the number of directors shall be construed not to be a vacancy. Any director elected to fill a vacancy shall be in the same class and have the same remaining term as that of the predecessor.

5. A director may be removed with or without cause, but only by action of the shareholders taken by the holders of at least 75% of the shares then entitled to vote in an election of directors.

6. A majority of the total number of directors fixed in the bylaws shall be required to constitute a quorum at meetings of the board of directors.

EIGHTH. Majority votes of stockholders. Notwithstanding any provision of the laws of the State of Maryland requiring approval by the stockholders of any action by the affirmative vote of a greater proportion than a majority of the votes entitled to be cast on the matter, any such action may be taken or authorized upon the concurrence of a majority of the number of votes entitled to be cast thereon.

NINTH. Indemnification. Each person who is or was a director or officer of the corporation, and each person who serves or served at the request of the corporation as a director or officer of another enterprise, shall be indemnified by the corporation in accordance with, and to the fullest extent authorized by, the General Corporation Law of the State of Maryland as it may be in effect from time to time, provided that this section shall not protect any director or officer of the corporation against any liability to the corporation or to its shareholders to which he would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of his office; and provided further that this article shall not apply as to any action, suit or proceeding brought by or on behalf of a director or officer without prior approval of the board of directors.

TENTH. Liability of directors and officers. The directors and officers of the corporation shall not be liable to the corporation or to any of its stockholders or creditors because of any action taken by them in good faith, and in taking any such action the directors and officers shall be fully protected in relying in good faith upon the books of account of the corporation or statements or reports prepared by any of its officials or employees or by others who they believe in good faith are qualified to make such statements or reports; provided that this sentence shall not protect any director or officer of the corporation against any liability to the corporation or to its stockholders to which he would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of his office.

ELEVENTH. Merger, sale of assets, liquidation. Notwithstanding any other provisions of these articles of incorporation, a favorable vote of the holders of at least 75% of the shares of the corporation then entitled to be voted on the matter shall be required to approve, adopt or authorize (i) a merger or consolidation of the corporation with any other corporation, (ii) a sale of all or substantially all of the assets of the corporation (other than in the regular course of its investment activities), or (iii) a liquidation or dissolution of the corporation, unless such action has previously been approved, adopted or authorized by the affirmative vote of two-thirds of the total number of directors fixed in accordance with the bylaws.

TWELFTH. Conversion to open-end company. Notwithstanding any other provisions of these articles of incorporation, at any time prior to January 1, 1992, a favorable vote of the holders of at least 75% of the shares of the corporation entitled to be voted on the matter shall be required to approve, adopt or authorize an amendment to the articles of incorporation of the corporation that makes the common stock a redeemable security (as that term is defined in the Investment Company Act of 1940), unless such action has previously been approved, adopted or authorized by the affirmative vote of two-thirds of the total number of directors fixed in accordance with the bylaws.

THIRTEENTH. Amendment of articles of incorporation. The corporation reserves the right to amend, alter change or repeal any provision contained in its articles of incorporation, in the manner now or hereafter prescribed by statute, and any rights conferred upon the stockholders are granted subject to this reservation. Notwithstanding any other provisions of these articles of incorporation or the bylaws of the corporation (and notwithstanding the fact that a lesser percentage may be specified by law, the articles of incorporation or the bylaws of the corporation), the amendment or repeal of article seventh, eighth, ninth, tenth, eleventh, twelfth or of this article thirteenth, of the articles of incorporation shall require the affirmative vote of the holders of at least 75% of the shares then entitled to be voted on the matter.

IN WITNESS WHEREOF, I have signed these articles of incorporation and have acknowledged the same to be my act on this 25 day of November, 1986.

/s/ Cameron S. Avery
Cameron S. Avery

WITNESS:

/s/ Janet D. Olsen
Janet D. Olsen

EX-99.2A CHARTER 4 ex_a2.htm ex_a2

Exhibit a.2

DUFF & PHELPS SELECTED UTILITIES INC.

Articles of Amendment

Duff & Phelps Selected Utilities Inc., a Maryland corporation having its principal office in Baltimore, Maryland (hereinafter called the corporation), hereby certifies to the State Department of Assessments and Taxation of Maryland, that:

FIRST: The Articles of Incorporation of the corporation are amended as follows:

Article FIFTH, Paragraph A of the Articles of Incorporation is deleted, and the
following is inserted in lieu thereof:

                                    A.   Authorized Stock. The total number of shares of stock that the
                        corporation shall have the authority to issue is 250,000,000 shares, all of one class
                        called common stock, $.001 par value per share (common stock), having an
                        aggregate par value of $250,000.

SECOND: The board of directors of the corporation, including all of the directors of the corporation, on January 12, 1987 duly adopted a resolution in which was set forth the foregoing amendment to the Articles of Incorporation and approved the foregoing amendment.

THIRD: The organizational meeting of the board of directors was held on November 26, 1986. There is no stock of the corporation outstanding or subscribed for entitled to be voted on the amendment.

FIFTH: (a) The total number of shares of stock which the corporation has heretofore authorized to issue is 100,000,000 shares, all of one class, of the par value of $.001 per share and of the aggregate par value of $100,000.

(b) The total number of shares of stock which the corporation is authorized to issue is increased by this amendment to 250,000,000 shares, $.001 par value per share, and the aggregate par value of the authorized shares is increased to $250,000.

IN WITNESS WHEREOF, Duff & Phelps Selected Utilities Inc. has caused these articles to be signed in its name and on its behalf by its president and attested by its secretary on January 13, 1987.

DUFF & PHELPS SELECTED
UTILITIES INC.

                                                                                    By /s/ Richard J. Spletzer
                                                                                        Richard J. Spletzer
                                                                                        Senior Vice President

Attest:

/s/ Calvin J. Pedersen
    Calvin J. Pedersen
    Assistant Secretary

The undersigned, senior vice president of Duff & Phelps Selected Utilities Inc., who executed on behalf of the corporation the foregoing articles of amendment, of which this certificate is made a part, hereby acknowledges, in the name and on behalf of the corporation, the foregoing articles of amendment to be the corporate act of the corporation and further certifies that to the best of his knowledge, information and belief, the matters and facts set forth therein with respect to the approval thereof are true in all material respects, under the penalties of perjury.

/s/ Richard J. Spletzer
Richard J. Spletzer

EX-99.2A CHARTER 5 ex_a3.htm ex_a4

Exhibit a.4

DUFF & PHELPS SELECTED UTILITIES INC.

Articles Supplementary creating five series of
Remarketed Preferred Stock

DUFF & PHELPS SELECTED UTILITIES INC., a Maryland corporation having its principal Maryland office in the City of Baltimore (the "Corporation"), certifies to the State Department of Assessments and Taxation of Maryland that:

FIRST: Pursuant to authority expressly vested in the Board of Directors of the Corporation by article fifth of its Charter, the Board of Directors has classified its preferred stock and has authorized the issuance of five series of 1,000 shares each of its authorized preferred stock, par value $.001 per share, liquidation preference $100,000 per share, designated respectively: Remarketed Preferred Stock, Series A; Remarketed Preferred Stock, Series B; Remarketed Preferred Stock, Series C; Remarketed Preferred Stock, Series D; and Remarketed Preferred Stock, Series E.

SECOND: The preferences, voting powers, restrictions, limitations as to dividends, qualifications, and terms and conditions of redemption, of the shares of such series of preferred stock are as follows:

DESIGNATION

SERIES A: A series of 1,000 shares of preferred stock, par value $.001 per share, liquidation preference $100,000 per share plus accumulated but unpaid dividends, if any, thereon (whether or not earned or declared), is hereby designated "Remarketed Preferred Stock, Series A." Each share of Remarketed Preferred Stock, Series A shall be issued on a date to be determined by the Board of Directors of the Corporation or a duly authorized committee thereof; have an Initial Dividend Payment Date (as herein defined) to be determined by the Board of Directors of the Corporation or a duly authorized committee thereof; be redeemed (unless such share shall have been otherwise redeemed pursuant to paragraph 4 of Part I of these Articles Supplementary or exchanged prior thereto for a share of Remarketed Preferred Stock, Series I, pursuant to paragraph 11 of Part I of these Articles Supplementary) by the Corporation on a date to be determined by the Board of Directors of the Corporation or a duly authorized committee thereof at a redemption price of $100,000 per share plus accumulated but unpaid dividends to the date fixed for redemption (whether or not earned or declared); and have such other preferences, limitations and relative voting rights, in addition to those required by applicable law or set forth in the Corporation's Charter applicable to preferred stock of the Corporation, as are set forth in Part I and Part II of these Articles Supplementary. The Remarketed Preferred Stock, Series A shall constitute a separate series of preferred stock of the Corporation, and each share of Remarked Preferred Stock, Series A shall be identical except as provided in paragraph 4 of Part I of these Articles Supplementary.

SERIES B: A series of 1,000 shares of preferred stock, par value $.001 per share, liquidation preference $100,000 per share plus accumulated but unpaid dividends, if any, thereon (whether or not earned or declared), is hereby designated "Remarketed Preferred Stock, Series B." Each share of Remarketed Preferred Stock, Series B shall be issued on a date to be determined by the Board of Directors of the Corporation or a duly authorized committee thereof; have an Initial Dividend Payment Date (as herein defined) to be determined by the Board of Directors of the Corporation or a duly authorized committee thereof; be redeemed (unless such share shall have been otherwise redeemed pursuant to paragraph 4 of Part I of these Articles Supplementary or exchanged prior thereto for a share of Remarketed Preferred Stock, Series I, pursuant to paragraph 11 of Part I of these Articles Supplementary) by the Corporation on a date to be determined by the Board of Directors of the Corporation or a duly authorized committee thereof at a redemption price of $100,000 per share plus accumulated but unpaid dividends to the date fixed for redemption (whether or not earned or declared); and have such other preferences, limitations and relative voting rights, in addition to those required by applicable law or set forth in the Corporation's Charter applicable to preferred stock of the Corporation, as are set forth in Part I and Part II of these Articles Supplementary. The Remarketed Preferred Stock, Series B shall constitute a separate series of preferred stock of the Corporation, and each share of Remarketed Preferred Stock, Series B shall be identical except as provided in paragraph 4 of Part I of these Articles Supplementary.

SERIES C: A series of 1,000 shares of preferred stock, par value of $.001 per share, liquidation preference $100,000 per share plus accumulated but unpaid dividends, if any, thereon (whether or not earned or declared), is hereby designated "Remarketed Preferred Stock, Series C." Each share of Remarketed Preferred Stock, Series C shall be issued on a date to be determined by the Board of Directors of the Corporation or a duly authorized committee thereof; have an Initial Dividend Payment Date (as herein defined) to be determined by the Board of Directors of the Corporation or a duly authorized committee thereof; be redeemed (unless such share shall have been otherwise redeemed pursuant to paragraph 4 of Part I of these Articles Supplementary or exchanged prior thereto for a share of Remarketed Preferred Stock, Series I, pursuant to paragraph 11 of Part I of these Articles Supplementary) by the Corporation on a date to be determined by the Board of Directors of the Corporation or a duly authorized committee thereof at a redemption price of $100,000 per share plus accumulated but unpaid dividends to the date fixed for redemption (whether or not earned or declared); and have such other preferences, limitations and relative voting rights, in addition to those required by applicable law or set forth in the Corporation's Charter applicable to preferred stock of the Corporation, as are set forth in Part I and Part II of these Articles Supplementary. The Remarketed Preferred Stock, Series C shall constitute a separate series of preferred stock of the Corporation, and each share of Remarketed Preferred Stock, Series C shall be identical except as provided in paragraph 4 of Part I of these Articles Supplementary.

SERIES D: A series of 1,000 shares of preferred stock, par value $.001 per share, liquidation preference $100,000 per share plus accumulated but unpaid dividends, if any, thereon (whether or not earned or declared), is hereby designated "Remarketed Preferred Stock, Series D." Each share of Remarketed Preferred Stock, Series D shall be issued on a date to be determined by the Board of Directors of the Corporation or a duly authorized committee thereof; have an Initial Dividend Payment Date (as herein defined) to be determined by the Board of Directors of the Corporation or a duly authorized committee thereof; be redeemed (unless such share shall have been otherwise redeemed pursuant to paragraph 4 of Part I of these Articles Supplementary or exchanged prior thereto for a share of Remarketed Preferred Stock, Series I, pursuant to paragraph 11 of Part I of these Articles Supplementary) by the Corporation on a date to be determined by the Board of Directors of the Corporation or a duly authorized committee thereof at a redemption price of $100,000 per share plus accumulated but unpaid dividends to the date fixed for redemption (whether or not earned or declared); and have such other preferences, limitations and relative voting rights, in addition to those required by applicable law or set forth on the Corporation's Charter applicable to preferred stock of the Corporation, as are set forth in Part I and Part II of these Articles Supplementary. The Remarketed Preferred Stock, Series D shall constitute a separate series of preferred stock of the Corporation, and each share of Remarketed Preferred Stock, Series D shall be identical except as provided in paragraph 4 of Part I of these Articles Supplementary.

SERIES E: A series of 1,000 shares of preferred stock, par value $.001 per share, liquidation preference $100,000 per share plus accumulated but unpaid dividends, if any, thereon (whether or not earned or declared), is hereby designated "Remarketed Preferred Stock, Series E." Each share of Remarketed Preferred Stock, Series E shall be issued on a date to be determined by the Board of Directors of the Corporation or a duly authorized committee thereof; have an Initial Dividend Payment Date (as herein defined) to be determined by the Board of Directors of the Corporation or a duly authorized committee thereof; be redeemed (unless such share shall have been otherwise redeemed pursuant to paragraph 4 of Part I of these Articles Supplementary or exchanged prior thereto for a share of Remarketed Preferred Stock, Series I, pursuant to paragraph 11 of this Part I of these Articles Supplementary) by the Corporation on a date to be determined by the Board of Directors of the Corporation of a duly authorized committee thereof at a redemption price of $100,000 per share plus accumulated but unpaid dividends to the date fixed for redemption (whether or not earned or declared); and have such other preferences, limitations and relative voting rights, in addition to those required by applicable law or set forth in the Corporation's Charter applicable to preferred stock of the Corporation, as are set forth in Part I and Part II of these Articles Supplementary. The Remarketed Preferred Stock, Series E shall constitute a separate series of preferred stock of the Corporation, and each share of Remarketed Preferred Stock, Series E shall be identical except as provided in paragraph 4 of Part I of these Articles Supplementary.

PART I.

1. Definitions. Unless the context or use indicates another or different meaning or intent, the following terms shall have the following meanings, whether used in the singular or plural:

"'AA' Composite Commercial Paper Rate," on any date, means (i) the Interest Equivalent of the rate on commercial paper placed for the number of days specified in the succeeding sentence on behalf of issuers whose corporate bonds are rated "AA" by S&P and "Aa" by Moody's, or the equivalent of such rating by another nationally recognized statistical rating organization, as such rate is made available by the Federal Reserve Bank of New York on a discount basis or otherwise for the Business Day immediately preceding such date, or (ii) if the Federal Reserve Bank of New York does not make available such a rate, then the arithmetic average of the Interest Equivalent of such rates on commercial paper placed on behalf of such issuers, as quoted on a discount basis or otherwise by the Commercial Paper Dealers to the Remarketing Agent for the close of business on the Business Day immediately preceding such date. In respect of any Dividend Period (determined without regard to any adjustment in the remarketing schedule in respect of non-Business Days, as provided herein), the "AA" Composite Commercial Paper Rate shall be the Interest Equivalent of the 60-day rate. If any Commercial Paper Dealer does not quote a rate required to determine the "AA" Composite Commercial Paper Rate, the "AA" Composite Commercial Paper Rate shall be determined on the basis of the quotation or quotations furnished by the remaining Commercial Paper Dealer or Dealers or, if none of the Commercial Paper Dealers quotes such a rate, by any Substitute Commercial Paper Dealer or Dealers selected by the Corporation to provide such rate or rates not being supplied by any Commercial Paper Dealer.

"Accountant's Confirmation" has the meaning set forth in paragraph 8(a) (iii) of this Part I.

"Adviser" means Duff & Phelps Investment Management Co., the Corporation's investment adviser.

"Agent Member" means a designated member of the Securities Depository that will maintain records for a Beneficial Owner of shares of RP that has identified such Agent Member in its Master Purchaser's Letter and that will be authorized and instructed to disclose information to the Remarketing Agent and the Paying Agent with respect to such Beneficial Owner.

"Applicable Dividend Rate" means, with respect to the Initial Dividend Period, the rate of cash dividend per annum established by the Board of Directors and, for each subsequent Dividend Period, means the rate of cash dividend per annum that (i) except for a Dividend Period commencing during a Non-Payment Period, will be equal to the lower of the rate of cash dividend per annum that the Remarketing Agent advises results on the Dividend Reset Date preceding the first day of such Dividend Period from implementation of the remarketing procedures set forth in Part II hereof and the Maximum Dividend Rate or (ii) for each Dividend Period commencing during a Non-Payment Period, will be equal to the Non-Payment Period Rate.

"Applicable Percentage" has the meaning set forth under "Maximum Dividend Rate" below.

"Authorized Newspaper" means a newspaper of general circulation in the English language generally published on Business Days in The City of New York.

"Beneficial Owner" means a person that has signed a Master Purchaser's Letter and is listed as the beneficial owner of one or more shares of RP in the records of the Paying Agent or, with respect to any share not registered in the name of the Securities Depository on the stock transfer books of the Corporation, the person in whose name such share is so registered.

"Board of Directors" means the Board of Directors of the Corporation.

"Business Day" means a day on which the New York Stock Exchange, Inc. is open for trading, and is not a day on which banks in The City of New York are authorized or obligated by law to close.

"Certificate of Minimum Liquidity" has the meaning set forth in paragraph 8(b) (i) of this Part I.

"Charter" means the Articles of Incorporation, as amended, of the Corporation, including these Articles Supplementary and the Articles Supplementary relating to the Serial RP (if any) on file in the State Department of Assessments and Taxation of the State of Maryland.

"Code" means the Internal Revenue Code of 1986, as amended from time to time.

"Commercial Paper Dealers" means Merrill Lynch, Pierce, Fenner & Smith Incorporated ("MLPF&S") and such other Commercial Paper Dealer or Dealers as the Corporation may from time to time appoint, or, in lieu of any thereof, their respective affiliates or successors.

"Common Stock" means the common stock, par value $.001 per share, of the Corporation.

"Conventional Mortgage Pass-Through Certificate" means an instrument publicly issued in bearer or registered form, that is one of a class or series or by its terms is divisible into a class or series, and that is of a type commonly dealt in on securities exchanges or markets or commonly recognized in any area in which it is issued or dealt in as a medium for investment, evidencing (directly or indirectly) a proportional undivided interest in specified pools of whole loans that are secured by a valid first lien on each mortgagor's fee or leasehold interest in related mortgaged property (except for Permitted Tax Liens and other matters to which like properties are commonly subject which neither individually nor in the aggregate materially interfere with the benefits of the security intended to be provided by such mortgages or deeds of trust, and standard exceptions and exclusions in title insurance policies) on one- to four-unit residences (including, without limitation, owner-occupied attached or detached single-unit residences, one- to four-unit primary residences, condominiums, second/vacation homes and non-owner occupied residences) and with respect to which the Required Documentation is required to be held by a trustee or independent custodian, which mortgage loans are serviced pursuant to servicing agreements with servicers that have either expressed the intention to advance funds to meet deficiencies (to the extent such servicers reasonably believe such advances are recoverable) or provided for alternative credit enhancement in lieu thereof, and which instruments (a) have been rated AA or better by S&P or Aa or better by Moody's or (b) do not qualify pursuant to clause (a) above, but the inclusion of which in the Eligible Portfolio Property will not, in and of itself, impair, or cause the RP to fail to retain, the then-current ratings assigned to the RP by the Rating Agencies, as evidenced by letters to the Corporation to such effect from the Rating Agencies which letters shall be delivered to the Remarketing Agent and the Paying Agent at the time each such Conventional Mortgage Pass-Through Certificate is to be included in the Eligible Portfolio Property; provided that, a Conventional Mortgage Pass-Through Certificate shall be eligible for inclusion in the Eligible Portfolio Property as of any Valuation Date only if it continues to satisfy as of such Valuation Date the requirements of at least one of clauses (a) or (b) above, as the Corporation may confirm verbally or in writing, directly or indirectly, or by reference to publications of the Rating Agencies, by confirmation from a nationally recognized securities dealer having a minimum capitalization of $25 million or by such other means as the Rating Agencies shall approve. The Remarketing Agent and the Paying Agent shall be entitled to rely on the representation of the Corporation contained in the RP Basic Maintenance Report with respect to any Valuation Date that, as of such Valuation Date, the Corporation has confirmed that the Conventional Mortgage Pass-Through Certificates included in the Corporation's Eligible Portfolio Property are within the scope of this paragraph.

"Corporation" means Duff & Phelps Selected Utilities Inc., a Maryland corporation and the issuer of the shares of RP.

"Date of Original Issue" means, with respect to any share of RP, the date on which the Corporation originally issues such share.

"Debt Obligations" has the meaning set forth under "Utility Stocks" below.

"Deposit Securities" means cash, U.S. Government Obligations and Short Term Money Market Instruments. Except for purposes of determining compliance with the RP Basic Maintenance Amount, each Deposit Security shall be deemed to have a value equal to its principal or face amount payable at maturity plus any interest payable thereon after delivery of such Deposit Security but only if payable on or prior to the applicable payment date in advance of which the relevant deposit is made.

"Discount Factor" means Discount Factor Supplied by Moody's or Discount Factor supplied by S&P, as the case may be.

"Discount Factor Supplied By S&P" means, initially, for any asset held by the Corporation, the number set forth opposite such type of asset in the following table (it being understood that any asset held by the Corporation and not listed in the following table or in an amendment or supplement thereto shall have a Discounted Value of zero):

	Discounted Factor (1)
Type A Utility Bonds:	1.80
Type B Utility Bonds:	1.85
Type A Utility Stocks:	2.25
Type B Utility Stocks:	2.35
GNMA Certificates with fixed interest rates:	1.40
GNMA Certificates with adjustable interest rates:	1.40
FHLMC and FNMA Certificates with fixed interest rates:	1.50
FHLMC and FNMA Certificates with adjustable interest rates:	1.50
FHLMC Multifamily Securities:	1.50
FHLMC and FNMA Certificates with variable interest rates:	1.50
GNMA Graduated Payment Securities:	1.60
Conventional Mortgage Pass-Through Certificates (2):	1.55
U.S. Government Obligations having a remaining term to maturity of 90 days or less:	1.00
U.S. Government Obligations having a remaining term to maturity of more than 90 days but not more than five years:	1.28
U.S. Government Obligations having a remaining term to maturity of more than five years but not more than 10 years:	1.35
U.S. Government Obligations having a remaining term to maturity of more than 10 years but not more than 15 years:	1.40
U.S. Government Obligations having a remaining term to maturity of more than 15 years but not more than 30 years:	1.50
Cash and Short Term Money Market Instruments:	1.00

(1)        In the case of Eligible Portfolio Property rated by Moody's but not rated by S&P, the
            Discount Factor Supplied by S&P shall be the Discount Factor determined therefor in
            writing by S&P. Absent such written notification, the asset shall have a Discounted Value
            of zero.

(2) In the event such asset is not rated AA or better by S&P, such asset shall have a
Discounted Value of zero.

Notwithstanding the foregoing, for so long as is required by S&P to maintain its then-current credit rating of the RP, the Discount Factor Supplied by S&P with respect to Eligible Portfolio Property sold pursuant to a reverse repurchase agreement with a remaining term to maturity of more than 25 days on the date of determination of the Discounted Value of such Eligible Portfolio Property shall be the then-current Discount Factor provided by S&P to the Corporation in writing for the purpose of such determination.

The Board of Directors shall have the authority to adjust, modify, alter or change from time to time the initial Discount Factor Supplied by S&P listed above applied to calculate the Discounted Value of any item of Eligible Portfolio Property or may specify from time to time a Discount Factor Supplied by S&P for any asset constituting Eligible Portfolio Property if the Board of Directors determines and S&P advises the Corporation in writing that such adjustment, modification, alteration, change or specification will not adversely affect S&P's then-current rating of the RP.

"Discount Factor Supplied By Moody's" means initially, for any asset held by the Corporation, the number set forth opposite such type of asset in the following table (it being understood that any asset held by the Corporation and not listed in the following table or in an amendment or supplement thereto shall have a Discounted Value of zero):

	Discount Factor (1)
Type I Utility Bonds having a remaining term to maturity of one year or less:	1.20
Type I Utility Bonds having a remaining term to maturity of more than one year but not more than two years:	1.27
Type I Utility Bonds having a remaining term to maturity of more than two years but not more than three years:	1.32
Type I Utility Bonds having a remaining term to maturity of more than three years but not more than four years:	1.38
Type I Utility Bonds having a remaining term to maturity of more than four years but not more than five years:	1.44
Type I Utility Bonds having a remaining term to maturity of more than five years but not more than seven years:	1.53
Type I Utility Bonds having a remaining term to maturity of more than seven years but not more than ten years:	1.61
Type I Utility Bonds having a remaining term to maturity of more than ten years but not more than 15 years:	1.69
Type I Utility Bonds having a remaining term to maturity of more than 15 years but not more than 20 years:	1.76
Type I Utility Bonds having a remaining term to maturity of more than 20 years but less than 30 years:	1.79
Type II Utility Bonds having a remaining term to maturity of one year or less:	1.24
Type II Utility Bonds having a remaining term to maturity of more than one year but not more than two years:	1.31
Type II Utility Bonds having a remaining term to maturity of more than two years but not more than three years:	1.38
Type II Utility Bonds having a remaining term to maturity of more than three years but not more than four years:	1.44
Type II Utility Bonds having a remaining term to maturity of more than four years but not more than five years:	1.50
Type II Utility Bonds having a remaining term to maturity of more than five years but not more than seven years:	1.60
Type II Utility Bonds having a remaining term to maturity of more than seven years but not more than ten years:	1.70
Type II Utility Bonds having a remaining term to maturity of more than ten years but not more than 15 years:	1.76
Type II Utility Bonds having a remaining term to maturity of more than 15 years but not more than 20 years:	1.84
Type II Utility Bonds having a remaining term to maturity of more than 20 years but not more than 30 years:	1.87
Type III Utility Bonds having a remaining term to maturity of one year or less:	1.29
Type III Utility Bonds having a remaining term to maturity of more than one year but not more than two years:	1.38
Type III Utility Bonds having a remaining term to maturity of more than two years but not more than three years:	1.44
Type III Utility Bonds having a remaining term to maturity of more than three years but not more than four years:	1.51
Type III Utility Bonds having a remaining term to maturity of more than four years but not more than five years:	1.57
Type III Utility Bonds having a remaining term to maturity of more than five years but not more than seven years:	1.67
Type III Utility Bonds having a remaining term to maturity of more than seven years but not more than ten years:	1.77
Type III Utility Bonds having a remaining term to maturity of more than ten years but not more than 15 years:	1.84
Type III Utility Bonds having a remaining term to maturity of more than 15 years but not more than 20 years:	1.92
Type III Utility Bonds having a remaining term to maturity of more than 20 years but not more than 30 years:	1.95
Type IV Utility Bonds having a remaining term to maturity of one year or less:	1.36
Type IV Utility Bonds having a remaining term to maturity of more than one year but not more than two years:	1.44
Type IV Utility Bonds having a remaining term to maturity of more than two years but not more than three years:	1.50
Type IV Utility Bonds having a remaining term to maturity of more than three years but not more than four years:	1.57
Type IV Utility Bonds having a remaining term to maturity of more than four years but not more than five years:	1.63
Type IV Utility Bonds having a remaining term to maturity of more than five years but not more than seven years:	1.74
Type IV Utility Bonds having a remaining term to maturity of more than seven years but not more than ten years:	1.83
Type IV Utility Bonds having a remaining term to maturity of more than ten years but not more than 15 years:	1.92
Type IV Utility Bonds having a remaining term to maturity of more than 15 years but not more than 20 years:	2.02
Type IV Utility Bonds having a remaining term to maturity of more than 20 years but not more than 30 years:	2.03
Type I Utility Stocks	2.00

FHLMC or FNMA Certificates	Discount Factor (Fixed Rate Mortgages)	Discount Factor (Adjustable Rate Mortgages)
FHLMC or FNMA Certificates with interest rates less than 6% but equal to or greater than 5%:	1.71	1.68
FHLMC or FNMA Certificates with interest rates less than 7% but equal to or greater than 6%:	1.66	1.68
FHLMC or FNMA Certificates with interest rates less than 8% but equal to or greater than 7%:	1.61	1.68
FHLMC or FNMA Certificates with interest rates less than 9% but equal to or greater than 8%:	1.57	1.68
FHLMC or FNMA Certificates with interest rates less than 10% but equal to or greater than 9%:	1.52	1.68
FHLMC or FNMA Certificates with interest rates less than 11% but equal to or greater than 10%:	1.49	1.68
FHLMC or FNMA Certificates with interest rates less than 12% but equal to or greater than 11%:	1.45	1.68
FHLMC or FNMA Certificates with interest rates less than 13% but equal to or greater than 12%:	1.43	1.68
FHLMC or FNMA Certificates with interest rates equal to or greater than 13%:	1.40	1.68

GNMA Certificates	Discount Factor
GNMA Certificates with interest rates less than 6% but equal to or greater than 5%:	1.63
GNMA Certificates with interest rates less than 7% but equal to or greater than 6%:	1.57
GNMA Certificates with interest rates less than 8% but equal to or greater than 7%:	1.52
GNMA Certificates with interest rates less than 9% but equal to or greater than 8%:	1.48
GNMA Certificates with interest rates less than 10% but equal to or greater than 9%:	1.45
GNMA Certificates with interest rates less than 11% but equal to or greater than 10%:	1.43
GNMA Certificates with interest rates less than 12% but equal to or greater than 11%:	1.40
GNMA Certificates with interest rates less than 13% but equal to or greater than 12%:	1.38
GNMA Certificates with interest rates equal to or greater than 13%:	1.36
GNMA Certificates with adjustable interest rates:	1.64
FHLMC Multifamily Securities:	(2)
FHLMC and FNMA Certificates with variable interest rates:	(4)
GNMA Graduated Payment Securities (seasoned):	(3)
Conventional Mortgage Pass-Through Certificates:	(5)
U.S. Government Obligations having a remaining term to maturity of up to one year:	1.09
U.S. Government Obligations having a remaining term to maturity of more than one year but not more than two years:	1.15
U.S. Government Obligations having a remaining term to maturity of more than two years but not more than three years:	1.20
U.S. Government Obligations having a remaining term to maturity of more than three years but not more than four years:	1.27
U.S. Government Obligations having a remaining term to maturity of more than four years but not more than five years:	1.32
U.S. Government Obligations having a remaining term to maturity of more than five years but not more than seven years:	1.41
U.S. Government Obligations having a remaining term to maturity of more than seven years but not more than 10 years:	1.49
U.S. Government Obligations having a remaining term to maturity of more than 10 years but not more than 15 years:	1.56
U.S. Government Obligations having a remaining term to maturity of more than 15 years but not more than 20 years:	1.64
U.S. Government Obligations having a remaining term to maturity of more than 20 years but not more than 30 years:	1.65
Cash and Short Term Money Market Instruments:	1.00

_______________________

(1)        In the case of Eligible Portfolio Property rated by S&P but not by Moody's, the Discount
            Factor Supplied by Moody's shall be the Discount Factor Supplied by Moody's applicable
            to Eligible Portfolio Property with a corresponding maturity but of the next lower rating
            category (e.g., a bond rated AAA by S&P but not rated by Moody's shall have a Discount
            Factor Supplied by Moody's equal to a bond of comparable maturity rated Aa by
            Moody's).

(2) The applicable Discount Factor set forth under "FHLMC or FNMA Certificates" above.

(3)        The same Discount Factor shall apply in the case of GNMA Graduated Payment
            Securities as applies to GNMA Certificates with fixed interest rates determined at the
            point the certificates become seasoned.

(4) The Discount Factor determined therefor in writing by Moody's.

(5) The Discount Factor determined therefor in writing by Moody's. In the event such asset
is not rated Aa or better by Moody's, such asset shall have a Discounted Value of zero.

Notwithstanding the foregoing, for so long as is required by Moody's to maintain its then-current credit rating of the RP, the Discount Factor Supplied by Moody's with respect to Eligible Portfolio Property sold pursuant to a reverse repurchase agreement with a remaining term to maturity of more than 25 days on the date of determination of the Discounted Value of such Eligible Portfolio Property shall be the then-current discount factor provided by Moody's to the Corporation in writing for the purpose of such determination.

The Board of Directors shall have the authority to adjust, modify, alter or change from time to time the initial Discount Factor Supplied by Moody's listed above applied to calculate the Discounted Value of any item of Eligible Portfolio Property or may specify from time to time a Discount Factor Supplied by Moody's for any asset constituting Eligible Portfolio Property if the Board of Directors determines and Moody's advises the Corporation in writing that such adjustment, modification, alteration, change or specification will not adversely affect Moody's then-current rating of the RP.

"Discounted Value," with respect to any asset held by the Corporation as of any date, means the quotient of the Market Value of such asset divided by the applicable Discount Factor Supplied by S&P (provided that, in the event the Corporation has written a call option on such asset, the Discounted Value of such asset shall be zero) or the quotient of the Market Value of such asset divided by the applicable Discount Factor Supplied by Moody's (provided that, in the event the Corporation has written a call option on such asset, the Discounted Value of such asset shall mean the quotient of the lower of the Market Value of such asset and the exercise price of such call option divided by the applicable Discount Factor Supplied by Moody's), as the case may be, provided that in no event shall the Discounted Value of any asset constituting Eligible Portfolio Property as of any date exceed the unpaid principal balance or face amount of such asset as of that date. With respect to the calculation of the Discounted Value of any Utility Bond included in the Corporation's Eligible Portfolio Property, such calculation shall be made using the criteria set forth in the definitions of Utility Bonds and Market Value. With respect to the calculation of the Discounted Value of any Utility Stock included in the Corporation's Eligible Portfolio Property, such calculation shall be made using the criteria set forth in the definitions of Utility Stocks and Market Value. With respect to the calculation of the aggregate Discounted Value of the Corporation's Eligible Portfolio Property for comparison with the RP Basic Maintenance Amount, such aggregate Discounted Value shall be the aggregate Discounted Value calculated using the Discount Factors Supplied by S&P or the aggregate Discounted Value calculated using the Discount Factors Supplied by Moody's whichever aggregate Discounted Value is lower; provided that, in calculating for such purpose the aggregate Discounted Value of the Corporation's Eligible Portfolio Property using the applicable Discount Factor Supplied by Moody's, the amount of Utility Stocks issued by public utility companies with nuclear facilities under construction (as determined by the Adviser) which may be included in such calculation shall be limited to five percent of the Market Value of the Corporation's Eligible Portfolio Property. Notwithstanding any other provision of these Articles Supplementary, any Utility Bond that has a remaining term to maturity of more than 30 years, and any asset as to which there is no Discount Factor Supplied by Moody's or Discount Factor Supplied by S&P either in these Articles Supplementary or in an amendment or supplement hereof, shall have a Discounted Value for purposes of determining the aggregate Discounted Value of the Corporation's Eligible Portfolio Property calculated using the Discount Factor Supplied by Moody's or S&P, as the case may be, of zero.

"Divided Coverage Amount," as of any Valuation Date, means (a) the aggregate amount of cash dividends that will accumulate on shares of RP to (but not including) the Dividend Payment Date that follows such Valuation Date less (b) the combined value of any Deposit Securities irrevocably deposited by the Corporation for the payment of cash dividends on the RP.

"Dividend Coverage Assets," as of any date of determination, means Deposit Securities with maturity dates not later than the day preceding the next Dividend Payment Date; provided, that, if the applicable date of determination is a Dividend Payment Date, any Deposit Securities to be applied to the dividends payable on the RP on such date shall not be included in Dividend Coverage Assets.

"Dividend Payment Date" means the day after the last day of the applicable Dividend Period; provided that, if any such date shall not be a Business Day, the Dividend Payment Date shall be the Business Day next succeeding such day.

"Dividend Reset Date" means any date on which the Remarketing Agent (i) determines the Applicable Dividend Rate for the ensuing Dividend Period, (ii) notifies holders, purchasers and tendering holders of shares of RP by telephone, telex or otherwise of the results of the Remarketing and (iii) announces such Applicable Dividend Rate.

"Dividends-Received Deduction" means the deduction allowed to corporate holders of certain preferred stock with respect to dividends received on such stock by Section 243(a)(1) of the Code, or any successor thereto.

"Eligible Portfolio Property" shall include Utility Bonds, Utility Stocks, cash, U.S. Government Obligations, Short Term Money Market Instruments, FNMA Certificates, FHLMC Certificates, FHLMC Multifamily Securities, GNMA Certificates, GNMA Multifamily Securities, GNMA Graduated Payment Securities, Conventional Mortgage Pass-Through Certificates and any other assets held by the Corporation that has been assigned a Discount Factor by the Rating Agencies and is included within the definition of Eligible Portfolio Property set forth herein or pursuant to an amendment or supplement hereto.

"Exchange Date" has the meaning set forth in paragraph 11, of this Part I.

"Exchange Event" has the meaning set forth in paragraph 11 of this Part I.

"FHLMC" means the Federal Home Loan Mortgage Corporation created by Title III of the Emergency Home Finance Act of 1970, and includes any successor thereto.

"FHLMC Certificate" means a mortgage participation certificate in physical or book-entry form, the timely payment of interest on and the ultimate collection of principal of which is guaranteed by FHLMC, and which evidences a proportional undivided interest in, or participation interest in, specified pools of fixed-, variable- or adjustable-rate, level payment fully amortizing mortgage loans secured by first-priority mortgages on one- to four-family residences.

"FHLMC Multifamily Security" means a "Plan B Multifamily Security" in physical or book-entry form, the timely payment of interest on and the ultimate collection of principal of which is guaranteed by FHLMC, and which evidences a proportional undivided interest in, or participation interest in, specified pools of fixed-, variable- or adjustable-rate level payment fully amortizing mortgage loans secure by first-priority mortgages on multi-family residences, the inclusion of which in the Eligible Portfolio Property will not, in and of itself, impair or cause the RP to fail to retain the ratings assigned to the RP by the Rating Agencies, as evidenced by letters to such effect delivered to the Corporation by the Rating Agencies.

"FNMA" means the Federal National Mortgage Association, a United States Government-sponsored private corporation established pursuant to Title VIII of the Housing and Urban Development Act of 1968, and includes any successor thereto.

"FNMA Certificate" means a mortgage pass-through certificate in physical or book-entry form, the full and timely payment of principal of and interest on which is guaranteed by FNMA, and which evidences a proportional undivided interest in specified pools of fixed-, variable- or adjustable-rate, level payment fully amortizing mortgage loans secured by first-priority mortgages on single-family and multi-family residences.

"GNMA" means the Government National Mortgage Association, and includes any successor thereto.

"GNMA Certificate" means a fully modified pass-through certificate in physical or book-entry form, the full and timely payment of principal of and interest on which is guaranteed by GNMA and which evidences a proportional undivided interest in specified pools of fixed-, variable- or adjustable-rate, level payment fully amortizing mortgage loans secured by first-priority mortgages on single-family and multi-family residences.

"GNMA Graduated Payment Security" means a fully modified pass-through certificate in physical or book-entry form, the full and timely payment of principal of and interest on which is guaranteed by GNMA, which obligation is backed by the full faith and credit of the United States, and which evidences a proportional undivided interest in specified pools of graduated payment mortgage loans with payments that increase annually at a predetermined rate for up to the first five or ten years of the mortgage loan and that are secured by first-priority mortgages on one- to four-unit residences.

"Holder" means, with respect to any share of RP, unless the context otherwise requires, the person whose name appears on the stock transfer books of the Corporation as the registered holder of such share.

"Independent Accountant" means a nationally recognized accountant, or firm of accountants, that is with respect to the Corporation an independent public accountant or firm of independent public accountants under the Securities Act of 1933, as amended.

"Initial Dividend Period" means, with respect to any share of RP, the period commencing on and including the Date of Original Issue of such share and ending on the day prior to the Initial Dividend Payment Date.

"Interest Equivalent" means a yield on a 360-day basis of a discount basis security which is equal to the yield on an equivalent interest-bearing security.

"Market Value" means, initially, the amount determined with respect to specific assets of the Corporation in the manner set forth below:

                                    (a)     as to any Utility Bond, (i) the product of (A) the unpaid principal
            balance of such Utility Bond as of the Reporting Date, and (B)(1) if the Utility Bond is
            traded on a national securities exchange or quoted on the NASDAQ System, the last sales
            price reported on the date of valuation or (2) if there was no reported sales price on the
            date of valuation or if the Utility Bond is not traded on a national securities exchange or
            quoted on the NASDAQ System, the lower of two bid prices for such Utility Bond
            provided by two nationally recognized securities dealers with a minimum capitalization
            of $25 million or by one such securities dealer and any other source (provided that the
            utilization of such source would not adversely affect the ratings of the RP) to the
            custodian of the Corporation's assets, at least one of which shall be provided in writing or
            by telecopy, telex, other electronic transcription, computer obtained quotation reducible
            to written form or similar means, and in turn provided to the Corporation by any such
            means by such custodian (provided that evidence of the bid quotes furnished by such
            custodian shall be provided to the Paying Agent and the Remarketing Agent by the
            Corporation with the related RP Basic Maintenance Report), plus (ii) accrued interest on
            such Utility Bond, or, if two bid prices cannot be obtained, such item of Eligible Portfolio
            Property shall have a Market Value of zero;

                                    (b)     as to any Utility Stock, (i) if the Utility Stock is traded on a national
            securities exchange or quoted on the NASDAQ System, the last sales price reported on
            the date of valuation or (ii) if there was no reported sales price on the date of valuation,
            the lower of two bid prices for such Utility Stock provided by two nationally recognized
            securities dealers with a minimum capitalization of $25 million or by one such securities
            dealer and any other source (provided that the utilization of such source would not
            adversely affect the then-current ratings of the RP) to the custodian of the Corporation's
            assets, at least one of which shall be provided in writing or by telecopy, telex, other
            electronic transcription, computer obtained quotation reducible to written form or similar
            means, and in turn provided to the Corporation by any such means by such custodian
            (provided that evidence of the bid quotes furnished by such custodian shall be provided to
            the Remarketing Agent by the Corporation with the related RP Basic Maintenance
            Report), or, if two bid prices cannot be obtained, such item of Eligible Portfolio Property
            shall have a Market Value of zero;

                                    (c)     the product of (i) as to GNMA Certificates, GNMA Graduated
            Payment Securities, GNMA Multifamily Securities, FNMA Certificates, FHLMC
            Certificates and FHLMC Multifamily Securities, the aggregate unpaid principal amount
            of the mortgage loans evidenced by each such certificate or security, as the case may be,
            which may include amounts shown on the most recent report related to the certificate or
            security received by the Corporation prior to the Reporting Date, and as to U.S.
            Government Obligations and Short Term Money Market Instruments (other than demand
            deposits, federal funds, bankers' acceptances and next Business Day's repurchase
            agreements), the face amount or aggregate principal amount of such U.S. Government
            Obligations or Short Term Money Market Instruments, as the case may be, and (ii) the
            lower of the bid prices for the same kind of certificates, securities or instruments, as the
            case may be, having, as nearly as practicable, comparable interest rates and maturities
            provided by two nationally recognized securities dealers having minimum capitalization
            of $25 million or by one such securities dealer and any other source (provided that the
            utilization of such source would not adversely affect the then-current ratings of the RP) to
            the custodian of the Corporation's assets, at least one of which shall be provided in
            writing or by telecopy, telex, other electronic transcription, computer obtained quotation
            reducible to written    form or similar means, and in turn provided to the Corporation by
            any such means by such custodian (provided that evidence of the bid quotes furnished by
            such custodian shall be delivered to the Remarketing Agent with the related RP Basic
            Maintenance Report), or, if two bid prices cannot be obtained, such item of Eligible
            Portfolio Property will have a Market Value of zero;

                                    (d)     as to Conventional Mortgage Pass-Through Certificates, the product
            of (i) the outstanding aggregate principal balance of the mortgage loans underlying such
            certificates as determined by the Corporation by any method which the Corporation
            believes reliable, which may include amounts based on verbal reports of the servicers of
            the related mortgage loans to the Corporation, as of the applicable Reporting Date and (ii)
            the dollar value of the lower of two bid prices per dollar of outstanding principal amount
            as of such applicable Reporting Date for such certificates, provided by two nationally
            recognized securities dealers having minimum capitalization of $25 million or by one
            such securities dealer and any other source (provided that the utilization of such source
            would not adversely affect the then-current ratings of the RP) to the custodian of the
            Corporation's assets, at least one of which shall be provided in writing or by telecopy,
            telex, other electronic transcription, computer obtained quotation reducible to written
            form or similar means, and in turn provided to the Corporation by any such means by
            such custodian (provided that evidence of the bid quotes furnished by such custodian
            shall be delivered to the Remarketing Agent with the related RP Basic Maintenance
            Report), or, if two bid prices cannot be obtained, such item of Eligible Portfolio Property
            shall have a Market Value of zero; and

                                    (e)        as to cash, demand deposits, federal funds, bankers' acceptances
            and next Business Day's repurchase agreements included in Short Term Money Market
            Instruments, the face value thereof.

The Board of Directors shall have the authority to adjust, modify, alter or change from time to time the initial method of calculation of the Market Value of an asset constituting Eligible Portfolio Property described above and the Board of Directors may specify from time to time the method for calculating the Market Value of any asset identified as Eligible Portfolio Property if the Board of Directors of the Corporation determines and the Rating Agencies advise the Corporation in writing that such adjustment, modification, alteration, change or specification will not adversely affect their then-current ratings of the RP.

"Master Purchaser's Letter" means a letter substantially in the form of Appendix B to the Corporation's prospectus relating to the shares of RP, or such other form as may be approved by the Remarketing Agent, which is required to be executed by each purchaser of shares of RP.

"Maximum Dividend Rate" for any Dividend Period at any Dividend Reset Date shall apply to a cash dividend, and be the Applicable Percentage of the applicable "AA" Composite Commercial Paper Rate. The Applicable Percentage shall vary with the lower of the credit rating or ratings assigned to the shares of RP by Moody's and S&P (or if Moody's or S&P or both shall not make such rating available, the equivalent of either or both of such ratings by a Substitute Rating Agency or two Substitute Rating Agencies or, in the event that only one such rating shall be available, such rating) on each Dividend Reset Date as follows:

Credit Ratings		Applicable Percentage
Moody's	S&P
"aa3" or higher	AA- or higher	110%
"a3" to "a1"	A- to A+	125%
"baa3" to "baa1"	BBB- to BBB+	150%
Below "baa3"	Below BBB-	200%

The Remarketing Agent shall round each applicable Maximum Dividend Rate to the nearest one-thousandth (0.001) of one percent per annum, with any such number ending in five ten-thousandths (0.005) of one percent being rounded upwards to the nearest one-thousandth (0.001) of one percent. The Remarketing Agent shall not round the applicable "AA" Composite Commercial Paper Rate as part of their calculation of any Maximum Dividend Rate.

"Minimum Holding Period" means 46 days or such other minimum holding period required for corporate taxpayers to be entitled to the Dividends-Received Deduction as provided in Section 246(c) of the Code or any successor thereto.

"Minimum Liquidity Level is met" means, as of any date of determination, that the aggregate Market Value of the Dividend Coverage Assets equals or exceeds the Dividend Coverage Amount.

"Moody's" means Moody's Investors Service, Inc.; and includes any successor
thereto.

"1940 Act" means the Investment Company Act of 1940, as amended from time to time.

"NASDAQ System" has the meaning set forth under "Type I Utility Stocks" below.

"1940 Act RP Asset Coverage" means asset coverage, as defined in section 18(h) of the 1940 Act, of at least 200% of the aggregate liquidation preference with respect to all outstanding senior securities of the Corporation which are stock, including all outstanding shares of RP and Other RP (or such other asset coverage as may be specified in or under the 1940 Act as the minimum asset coverage for senior securities which are stock of a closed-end investment company as a condition of paying dividends on its common stock).

"1940 Act Cure Date," with respect to the failure by the Corporation to maintain the 1940 Act RP Asset Coverage (as required by paragraph 7 of this Part I) as of the last day of each month, means the last Business Day of the following such month.

"Non-Payment Period" means any period beginning on and including the day on which the Corporation shall fail to (i) declare, prior to 12:00 noon, New York City time, on the second Business Day preceding any Dividend Payment Date for any shares of RP, for payment on such Dividend Payment Date to the Beneficial Owners of such shares of RP as of 12:00 noon, New York City time, on the Business Day preceding such Dividend Payment Date, the full amount of any dividend on such shares of RP payable on such Dividend Payment Date or (ii) deposit, irrevocably in trust, in same-day funds, with the Paying Agent by 12:00 noon, New York City time, (A) on any Dividend Payment Date the full amount of any declared cash dividend (whether or not earned) payable on such Dividend Payment Date or (B) on any redemption date for any shares of RP, the redemption price of such shares of $100,000 per share plus the full amount of any cash dividends thereon (whether or not earned or declared) accumulated but unpaid to such redemption date after a Notice of Redemption with respect to such shares of RP has been given pursuant to paragraph 4(e) of Part I hereof, and ending on and including the Business Day on which, by 12:00 noon, New York City time, all unpaid cash dividends and unpaid redemption prices shall have been so deposited or shall have otherwise been made available to Beneficial Owners in same-day funds; provided that a Non-Payment Period shall not end during the first seven days thereof unless the Corporation shall have given at least three days' written notice to the Paying Agent, the Remarketing Agent and the Securities Depository and thereafter shall not end unless the Corporation shall have given at least fourteen days' written notice to the Paying Agent, the Remarketing Agent, the Securities Depository and all Beneficial Owners.

"Non-Payment Period Rate" means, initially, 200% of the applicable "AA" Composite Commercial Paper Rate, provided that the Board of Directors shall have the authority to adjust, modify, alter or change from time to time the initial Non-Payment Period Rate if the Board of Directors determines and the Rating Agencies advise the Corporation in writing that such adjustment, modification, alteration or change will not adversely affect their then-current ratings on the RP.

"Notice of Redemption" means any notice with respect to the redemption of shares of RP pursuant to paragraph 4 of this Part I.

"Other RP" means the remarketed preferred stock of the Corporation, other than the RP.

"Paying Agent" means Bankers Trust Company, or any successor company or entity, which has entered into a Paying Agent Agreement with the Corporation to act for the Corporation, among other things, as the transfer agent, registrar, dividend and redemption price disbursing agent, settlement agent and agent for certain notifications in connection with the shares of RP in accordance with such agreement.

"Paying Agent Agreement" means an agreement to be entered into between the Corporation and the Paying Agent.

"Permitted Tax Liens" means liens for general and special taxes and assessments on the property in question.

"Preferred Stock" means the preferred stock of the Corporation, and includes RP and Other RP.

"Projected Dividend Amount" for the RP and the Other RP shall mean, initially, if the date of determination is a Valuation Date, the amount of cash dividends, based on the number of shares of RP and the Other RP outstanding on such Valuation Date, projected to accumulate on such shares from such Valuation Date until the 70th day after such Valuation Date, at the following dividend rates:

                                    (a) If the Valuation Date is the Date of Original Issue or a Dividend
            Payment Date (which terms, for purposes of this definition, shall refer to the equivalent
            date in the case of Other RP), (i) for the Dividend Period beginning on the Date of
            Original Issue or such Dividend Payment Date and ending on (but not including) the first
            following Dividend Payment Date, the Applicable Dividend Rate (which terms, for
            purposes of this definition, shall refer to the equivalent date in the case of Other RP) in
            effect on such Valuation Date, and (ii) for the period beginning on (and including) the
            first following Dividend Payment Date and ending on (and including) the 70th day
            following such Valuation Date, the product of 2.32 and (x) the Maximum Dividend Rate
            (which terms, for purposes of this definition, shall refer to the equivalent date in the case
            of Other RP) on the Date of Original Issue (in the case of the Date of Original Issue) or
            (y) the Maximum Dividend Rate as of the last occurring Settlement Date or, in the case
            of Other RP, the equivalent date (in the case of any Dividend Payment Date); and

                                    (b) If such Valuation Date is not the Date of Original Issue or a
            Dividend Payment Date, (i) for the period beginning on such Valuation Date and ending
            on (but not including) the first following Dividend Payment Date, the Applicable
            Dividend Rate in effect on such Valuation Date, and (ii) for the period beginning on (and
            including) the first following Dividend Payment Date and ending on (but not including)
            the sooner of the second following Dividend Payment Date or the 71st day following
            such Valuation Date, the product of 2.32 and (x) the Maximum Dividend Rate on the
            Date of Original Issue (in the case of a Valuation Date occurring prior to the first
            Settlement Date) or (y) the Maximum Dividend Rate on the last occurring Settlement
            Date or, in the case of Other RP, the equivalent date (in the case of any other Valuation
            Date) and (iii) for the period, if any, beginning on (and including) the second following
            Dividend Payment Date and ending on (but not including) the 71st day following such
            Valuation Date, the product of 3.20 and the rate specified in clause (x) or (y) above.

If the date of determination is not a Valuation Date, then the Projected Dividend Amount on such date of determination shall equal the Projected Dividend Amount therefor on the immediately preceding Valuation Date, adjusted to reflect any decrease in the number of shares of RP and Other RP outstanding. The Board of Directors shall have the authority to adjust, modify, alter or change from time to time the initial bases for the calculation of the Projected Dividend Amount if the Board of Directors determines and the Rating Agencies shall have advised the Corporation in writing that such adjustment, modification, alteration or change would not adversely affect their then-current ratings of the RP.

"Quarterly Valuation Date" means, for so long as any shares of RP are outstanding, the last Business Day of March, June, September and December of each year, commencing December 31, 1988, or, if such day is not a Valuation Date, the next preceding Valuation Date.

"Rating Agencies" means S&P and Moody's for so long as S&P and Moody's issue ratings for the RP, and, at such time as S&P and/or Moody's no longer issues a rating for the RP, the Substitute Rating Agency or Substitute Rating Agencies, as the case may be.

"Remarketing" means each periodic operation of the process for remarketing shares of RP as described in Part II hereof.

"Remarketing Agent" means MLPF&S and any additional or successor companies or entities which have entered into an agreement with the Corporation to carry out the remarketing procedures for the purpose of determining the Applicable Dividend Rates.

"Reporting Date," with respect to any price referred to in the definition of the Market Value of an item of Eligible Portfolio Property, shall mean the date as of which the Market Value of such item of Eligible Portfolio Property is to be determined or, if no such price is available as provided above under "Market Value" for such date, the next closest prior date as of which such price is so available; provided that, no such price shall be deemed to be available as of a Reporting Date if such price is not available as of a date within five Business Days next preceding the date as of which the determination of such Market Value is to be made.

"Required Documentation," with respect to a mortgage loan underlying a Conventional Mortgage Pass-Through Certificate means:

                                    (a) the mortgage note or other evidence of indebtedness secured by the
            mortgage endorsed without recourse in blank or other trustee or other custodian and
            accompanied by an assignment thereof;

                                    (b) the mortgage, deed of trust, deed to secure debt or similar security
            instruments encumbering real property or related documentation, with evidence of
            recording or filing thereof, in each case accompanied by assignments thereof, executed in
            blank or to the trustee or other custodian, in recordable form as may be appropriate in the
            jurisdiction where the property is located and evidence that such assignment has been
            recorded in the name of the trustee or other custodian, and such trustee or other custodian
            receives an opinion of counsel (containing only such exceptions as may be permissible
            under the indenture or other agreement pursuant to which the mortgage loan is pledged to
            the trustee in connection with the related Conventional Mortgage Pass-Through
            Certificate) to the effect that, notwithstanding that the assignment of the mortgage has not
            been recorded, the actions taken with respect to the mortgage loan are sufficient to permit
            the trustee or other custodian to avail itself of all protection available under applicable
            law against the claims of any present or future creditors of the issuer, and are sufficient to
            prevent any other sale, transfer, assignment, pledge or hypothecation of the mortgage and
            the related mortgage note by the issuer from being enforceable, or will create a valid
            assignment of and a valid and perfected lien upon and security interest in a mortgage and
            related mortgage note, which lien and security interest is (except for the trustee's lien
            securing certain obligations of the issuer to the trustee as provided in the indenture
            pursuant to which the mortgage loan is pledged to the trustee in connection with the
            related Conventional Mortgage Pass-Through Certificate) prior in right to all other
            security interests therein created or perfected under the Uniform Commercial Code (as in
            effect in the jurisdiction where the property is located);

(c) in the case of mortgage notes covered by private mortgage
insurance, evidence that such mortgage notes are so insured; and

                                    (d) a copy of the title insurance policy or an opinion or certificate of
            counsel stating that the mortgage constitutes a first lien on the premises described in such
            mortgage (which opinion or certificate may be subject to exceptions for Permitted Tax
            Liens and other matters to which like properties are commonly subject which neither
            individually nor in the aggregate materially interfere with the benefits of the security
            interest intended to be provided by such mortgage and standard exceptions and
            exclusions from mortgage title insurance policies).

"Right" has the meaning set forth in paragraph 3(1) of this Part I.

"RP" means either the Remarketed Preferred Stock, Series A; the Remarketed Preferred Stock, Series B; the Remarketed Preferred Stock, Series C; the Remarketed Preferred Stock, Series D; or the Remarketed Preferred Stock, Series E.

"RP Basic Maintenance Amount" means, initially, as of any date, the sum of (i) the aggregate liquidation preference of the shares of RP outstanding and shares of Other RP outstanding, (ii) to the extent no covered in (i), the aggregate amount of accumulated but unpaid cash dividends with respect to the shares of RP outstanding and shares of Other RP outstanding, (iii) any Rights due and payable and any equivalent rights to receive cash with respect to Other RP which are due and payable, (iv) the principal amount of the Corporation's loan from the Aid Association for Lutherans then outstanding, (v) an amount equal to accrued but unpaid interest on the principal amount of the Corporation's loan from the Aid Association For Lutherans then outstanding, (vi) the aggregate principal amount of, and an amount equal to accrued but unpaid interest on, any other then outstanding indebtedness of the Corporation for money borrowed, (vii) the aggregate Projected Dividend Amount, (viii) redemption premium, if any, and (ix) the greater of $200,000 or an amount equal to projected expenses of the Corporation for the next three month period. The Board of Directors shall have the authority to adjust, modify, alter or change from time to time the initial elements comprising the RP Basic Maintenance Amount if the Board of Directors determines and the Rating Agencies advise the Corporation in writing that such adjustment, modification, alteration or change will not adversely affect their then-current ratings on the RP.

"RP Basic Maintenance Cure Date," with respect to the failure by the Corporation to maintain the RP Basic Maintenance Amount (as required by paragraph 8 of this Part I) as of each Valuation Date, means the eighth Business Day following such Valuation Date.

"RP Basic Maintenance Report" means a report signed by the President, the Treasurer, any Senior Vice President or any Vice President of the Corporation which sets forth, as of the related Valuation Date, the assets of the Corporation, the Market Value and the Discounted Value thereof (seriatum and in the aggregate), and the RP Basic Maintenance Amount.

"S&P" means Standard & Poor's Corporation, and includes any successor thereto.

"Securities Depository" means The Depository Trust Company, a securities depository, or any successory company or other entity selected by the Corporation for the shares of RP that agrees to follow the procedures required to be followed by such securities depository in connection with the shares of RP.

"Service" means the Internal Revenue Service.

"Settlement Date" means any date on which (i) a new Dividend Period begins, and (ii) shares of RP which have been tendered and sold in a Remarketing are delivered through the Securities Depository.

"Short Term Money Market Instruments" means the following kinds of instruments, if on the date of purchase or other acquisition by the Corporation of any such instrument the remaining term to maturity thereof is not more than 30 days:

                                    (a) demand deposits in, certificates of deposit of, bankers' acceptances
            issued by, or federal funds sold to, any depository institution, the deposits of which are
            insured by the Federal Deposit Insurance Corporation (or any successor thereto) or the
            Federal Savings and Loan Insurance Corporation (or any successor thereto), provided
            that, at the time of the Corporation's investment therein, the commercial paper or other
            unsecured short-term debt obligations of such depository institution are rated at least A-
            1+ by S&P and Prime-1 by Moody's;

                                    (b) repurchase obligations with respect to a U.S. Government
            Obligation, FNMA Certificate, FHLMC Certificate or GNMA Certificate entered into
            with a depository institution, the deposits of which are insured by the Federal Deposit
            Insurance Corporation (or any successor thereto) or the Federal Savings and Loan
            Insurance Corporation (or any successor thereto) and the commercial paper or other
            unsecured short-term debt obligations of which are rated at least A-1+ by S&P and
            Prime-1 by Moody's, which must be repurchased within one Business Day from the date
            such repurchase obligation was entered into; and

(c) commercial paper rated at the time of the Corporation's investment
therein at least A-1+ by S&P and Prime-1 by Moody's.

"Substitute Commercial Paper Dealers" means such Substitute Commercial Paper Dealer or Dealers as the Corporation may from time to time appoint or, in lieu of any thereof, their respective affiliates or successors.

"Substitute Rating Agency" and "Substitute Rating Agencies" mean a nationally recognized statistical rating organization or two nationally recognized statistical rating organizations, respectively, selected by the Corporation to act as the substitute rating agency or substitute rating agencies, as the case may be, to determine the credit ratings of the shares of RP.

"Tender and Dividend Reset" means the process pursuant to which shares of RP may be tendered or deemed tendered in a Remarketing or held and become subject to the new Applicable Dividend Rate determined by the Remarketing Agency in such Remarketing.

"Tender Date" means any date on which (i) each holder of shares of RP must provide to the Remarketing Agent irrevocable telephonic notice of intent to tender shares of RP in a Remarketing, and (ii) such Remarketing formally commences.

"Type A Utility Bonds" as of any date means Utility Bonds rated A- or higher by S&P.

"Type B Utility Bonds" as of any date means (a) Utility Bonds held by the Corporation at such date and continuously since at least September 30, 1988 which are rated from BBB- to BBB+ by S&P or (b) Utility Bonds rated BBB- to BBB+ by S&P provided that the Utility Bonds rated BBB- shall be limited to twenty-five percent of the Market Value of the Corporation's Eligible Portfolio Property.

"Type I Utility Bonds" as of any date means Utility Bonds rated Aaa by Moody's.

"Type II Utility Bonds" as of any date means Utility Bonds rated Aa3 to Aa1 by Moody's.

"Type III Utility Bonds" as of any date means Utility Bonds rated A3 to A1 by Moody's.

"Type IV Utility Bonds" as of any date means Utility Bonds rated Baa3 to Baa1 by Moody's.

"Type A Utility Stocks" as of any date means Utility Stocks which are traded on the New York Stock Exchange, Inc. or the American Stock Exchange, Inc., are currently paying cash dividends, and have been issued by public utility companies having debt obligations outstanding with implied senior debt ratings from S&P of A- or higher.

"Type B Utility Stocks" as of any date means (a) Utility Stocks which are traded on the New York Stock Exchange, Inc. or the American Stock Exchange, Inc., are currently paying cash dividends, are held by the Corporation at such date and continuously since at least September 30, 1988 and have been issued by public utility companies having debt obligations outstanding with implied senior debt ratings from S&P of BBB- to BBB+ or (b) Utility Stocks which are traded on the New York Stock Exchange, Inc. or the American Stock Exchange, Inc., are currently paying cash dividends and have been issued by public utility companies having debt obligations outstanding with implied senior debt ratings from S&P from BBB- to BBB+ provided that Utility Stocks issued by public utility companies having debt obligations outstanding with implied senior debt ratings from S&P of BBB- shall be limited to twenty-five percent of the Market Value of the Corporation's Eligible Portfolio Property.

"Type I Utility Stocks" as of any date means Utility Stocks which are traded on the New York Stock Exchange, Inc. or the American Stock Exchange, Inc. or are quoted on the National Association of Securities Dealers Automated Quotation ("NASDAQ") System and have been issued by public utility companies having debt obligations outstanding with senior or subordinated debt ratings from Moody's of Baa3 or higher.

"U.S. Government Obligations" means direct obligations of the United States, provided that such direct obligations are entitled to the full faith and credit of the United States and that any such obligations, other than United States Treasury Bills, provide for the periodic payment of interest and the full payment of principal at maturity or call for redemption.

"Utility Bonds" means, initially, corporate debt obligations issued by state regulated public utility companies rated from BBB- to AAA by S&P and from Baa3 to Aaa by Moody's, which corporate debt obligations (a) provide for the periodic payment of interest thereon in cash in U.S. dollars, (b) do not provide for conversion or exchange into equity capital at any time over their respective lives, (c) have been registered under the Securities Act of 1933, as amended, and (d) have not had notice given in respect thereof that any such corporate debt obligations are the subject of an offer by the issuer thereof of exchange or tender for cash, securities or any other type of consideration. In addition, so long as the shares of RP are rate by S&P or Moody's, no corporate debt obligation held by the Corporation shall be deemed a Utility Bond (i) if it fails to meet the criteria in column (1) below or (ii) to the extent (but only to the proportionate extent) the acquisition or holding thereof by the Corporation causes the Corporation to exceed any applicable limitation set forth in column (2) below in the event the shares of RP are rated by S&P or column (2), (3) or (4) below in the event the shares to RP are rated by Moody's as of any relevant date of determination (provided that, in the event that the Corporation shall exceed any such limitation, the Corporation shall designate, in its sole discretion, the particular Utility Bond(s) and/or portions thereof which shall be deemed to have caused the Corporation to exceed such limitation):

	Column (1)	Column (2)		Column (3)	Column (4)
S&P and Moody's Rating of Utility Bonds or Debt Obligations(1)	Minimum Original Issue Size of Each Issue(2)	Maximum Percent of Market Value of Eligible Portfolio Property Issued by any One Issuer(3)		Maximum Percent of Market Value of Corporation's Assets, Including Eligible Portfolio Property, Issued by Issuers in any One Industry Category(4)	Maximum Percent of Market Value of Corporation's Assets, Including Eligible Portfolio Property, Issued by Issuers Regulated by any One State(5)
	($ in millions)	S&P	Moody's
AAA; Aaa................	$100	10.0%	100.0%	100.0%	100.0%
AA; Aa.....................	100	10.0	20.0	60.0	20.0
A; A..........................	100	10.0	10.0	50.0	10.0
BBB; Baa..................	100	5.0	4.0	50.0	7.0

(1) Rating designations include (+) or (-) modifiers to the S&P rating where appropriate.
Rating designations include modifiers of 1 to 3 to the Moody's rating where appropriate.

(2) This restriction is applicable only to Utility Bonds.

(3)        The referenced S&P percentages represent maximum percentages only for the related
            S&P rating category. The referenced Moody's percentages represent maximum
            cumulative totals only for the Moody's rating category and each lower Moody's rating
            category.

(4)        The referenced percentages represent maximum cumulative totals only for the related
            Moody's rating category and each lower Moody's rating category. There are two industry
            categories-- telecommunications and all other utilities.

(5) Referenced percentages represent maximum cumulative totals only for the related
Moody's and each lower Moody's rating category.

The Board of Directors shall have the authority to adjust, modify, alter or change from time to time the assets (and/or the characteristics thereof) included initially within the definition of Utility Bonds for purposes of determining compliance with the RP Basic Maintenance Amount if the Board of Directors determines and the Rating Agencies advise the Corporation in writing that such adjustment, modification, alteration or change will not adversely affect their then-current ratings of the RP.

"Utility Stocks" means, initially, common stocks issued by state regulated public utility companies having debt obligations outstanding with senior debt ratings of BBB to AAA from S&P or subordinated debt ratings of BBB- to AAA from S&P and senior or subordinated debt ratings of Baa3 to Aaa from Moody's, which debt obligations have been registered under the Securities Act of 1933, as amended ("Debt Obligations"). In addition, so long as the shares of RP are rated by S&P or Moody's, no common stock held by the Corporation shall be deemed a Utility Stock to the extent (but only to the proportionate extent) the acquisition or holding thereof by the Corporation causes the Corporation to exceed any applicable limitation set forth in column (2) of the table set forth in "Utility Bonds" above in the event the shares of RP are rated by S&P or column (2), (3) or (4) of such table in the event the shares of RP are rated by Moody's as of any relevant date of a termination (provided that, in the event that the Corporation shall exceed any such limitation, the Corporation shall designate, in its sole discretion, the particular Utility Stock(s) and/or portions thereof which shall be deemed to have caused the Corporation to exceed such limitation). The Board of Directors shall have the authority to adjust, modify, alter or change from time to time the assets (and/or the characteristics thereof) initially included within the definition of Utility Stocks for purposes of determining compliance with the RP Basic Maintenance Amount if the Board of Directors determines and the Rating Agencies advise the Corporation in writing that such adjustment, modification, alteration or change will not adversely affect their then-current ratings of the RP.

"Valuation Date" means (i) the fifteenth day of each month or, if such day is not a Business Day, the next succeeding Business Day, and (ii) the last Business Day of each month (or, in the case of the first Valuation Date, a date selected by the Corporation within fifteen days after the Original Issue Date).

"Voting Period" has the meaning set forth in paragraph 6(b) of this Part I.

2. Fractional Shares. No fractional shares of RP shall be issued or recognized by the Corporation.

3. Dividends. (a) The Holders as of 12:00 noon, New York City time, on the Business Day preceding the applicable Dividend Payment Dates, shall be entitled to receive, when, as and if declared by the Board of Directors, out of funds legally available transfer, cumulative dividends each consisting of (i) cash at the Applicable Dividend Rate and (ii) a Right to receive cash determined as set forth in paragraph 3(1) below and payable as set forth therein. The Board of Directors shall designate, in accordance with the applicable provisions of the Code, the cash dividends on the shares of RP so declared and paid or payable and on the shares of Other RP declared and payable for any fiscal year as qualifying for the Dividends-Received Deduction in an amount equal to the lesser of (i) the amount of the Corporation's income for such fiscal year which qualifies for the Dividends-Received Deduction, or (ii) the amount of such cash dividends.

(b) Dividends on shares of RP shall accumulate from their Date of Original Issue and will be payable, when, as and if declared by the Board of Directors, on each Dividend Payment Date.

(c) Each declared dividend, including each Right, shall be payable on the applicable Dividend Payment Date to the Holder or Holders of such shares of RP as set forth in paragraph 3(a). Dividends on any share in arrears for any past Dividend Payment Date may be declared and paid at any time, without reference to any regular Dividend Payment Date, to the Holder of such share on a date not exceeding five Business Days preceding the payment date thereof, as may be fixed by the Board of Directors. Any dividend payment made on any share of RP shall first be credited against the earliest dividends accumulated but unpaid (whether or not earned) with respect to such share.

(d) Neither Holders nor Beneficial Owners of shares of RP shall be entitled to any dividends on the shares of RP, whether payable in cash, property or stock, in excess of full cumulative dividends (including Rights) thereon. Except as provided in paragraph 3(h) or 3(l) of this Part I, neither Holders nor Beneficial Owners of shares of RP shall be entitled to any interest, or other additional amount, on any dividend payment (including Rights) on any share of RP which may be in arrears.

(e) Except as otherwise provided herein, the Applicable Dividend Rate on each share of RP for each Dividend Period with respect to such share shall be equal to the rate per annum that results from implementation of the remarketing procedures described in Part II hereof.

(f) The amount of cash dividends for shares of RP payable (if declared) on each Dividend Payment Date shall be computed by the Corporation by multiplying the Applicable Dividend Rate in effect with respect to cash dividends payable on such share on such Dividend Payment Date by a fraction the numerator of which shall be the number of days such share was outstanding from and including its Date of Original Issue or the preceding Dividend Payment Date on which a cash dividend was paid, as the case may be, to and including the last day of such Dividend Period, and the denominator of which shall be 360, and then multiplying the percentage so obtained by $100,000.

(g) No later than by 12:00 noon, New York City time, on each Dividend Payment Date, the Corporation shall deposit in same-day funds with the Paying Agent the full amount of any dividend declared and payable on such Dividend Payment Date on any share of RP. For the purposes of the foregoing, payment in New York Clearing House (next-day) funds at any time on any Business Day shall be considered equivalent to payment in same-day funds on the next Business Day at the same time, and any payment made after 12:00 noon, New York City time, on any Business Day shall be considered to have been made instead in the form of funds before 12:00 noon, New York City time, on the next Business Day.

(h) The Applicable Dividend Rate for each Dividend Period commencing during a Non-Payment Period shall be equal to the Non-Payment Period Rate.

(j) Except during a Non-Payment Period, by 1:00 p.m. on the Tender Date at the end of the Initial Dividend Period and by 1:00 p.m. on the Tender Date at the end of each subsequent Dividend Period, the Beneficial Owner of a share of RP may elect to tender such share or to hold such share for the next Dividend Period. If the Beneficial Owner of such share of PR fails to elect to tender or hold such share by 1:00 p.m. on such Tender Date, such Beneficial Owner shall continue to hold such share at the Applicable Dividend Rate determined in such Remarketing for the next Dividend Period; provided that, if there is no Remarketing Agent, the Remarketing Agent does not conduct a Remarketing or the Remarketing Agent is unable to remarket in such Remarketing all shares of RP tendered to it at a price of $100,000 per share, then such Beneficial Owner shall hold such share for the next Dividend Period and the Applicable Dividend Rate therefor shall be the Maximum Dividend Rate.

(k) In the event of a change in law altering the Minimum Holding Period, the Board of Directors may increase or decrease the period of time between Dividend Payment Dates so as to adjust uniformly the number of days in any Dividend Period commencing after the date of such change in law to equal or exceed the then current Minimum Holding Period; provided that, the number of days for any Dividend Period as so adjusted shall not exceed 98 and shall be evenly divisible by seven (except as required from time to time by adjustments in the remarketing schedule as provided herein). Upon any such adjustment by the Board of Directors, the Corporation shall notify the Remarketing Agent and the Paying Agent, and the Paying Agent shall in turn notify the Securities Depository, of such adjustment; provided that, during a Non-Payment Period, the Corporation also shall notify the Beneficial Owners of shares of RP directly of such adjustment.

(l) Each dividend shall consist of (i) cash at the Applicable Dividend Rate and (ii) a right (a "Right") to receive cash (as determined below). Each Right shall thereafter be independent of the share or shares of RP on which the dividend was paid. The Corporation shall cause to be maintained a record of each Right received by the respective Holders. The Corporation shall not be required to recognize any transfer of a Right. If all or any part of the cash dividends on the shares of RP during any fiscal year does not qualify for the Dividends-Received Deduction ("Nonqualifying Distributions") because (i) the Corporation does not have income for such fiscal year eligible for the Dividends-Received Deduction at least equal to the dividends paid on the RP and the Other RP for such year, or (ii) the Corporation does not properly designate dividends on the RP as being eligible for the Dividends-Received Deduction, the applicable Rights shall entitle the holders thereof ("Right Holders") to additional cash (as set forth below), and the Corporation will, within 270 days after the end of such fiscal year, provide notice thereof to the Paying Agent. The Paying Agent will mail a copy of such notice to each Right Holder at the address specified in such Right Holder's Master Purchaser's Letter as promptly as practicable after its receipt of such notice from the Corporation. The Corporation will within 30 days after such notice is given to the Paying Agent pay to the Paying Agent (who will then distribute to Right Holders), out of funds legally available therefor, cash in satisfaction of the applicable Rights in an amount specified below with respect to all Nonqualifying Distributions made during such fiscal year.

Cash payable pursuant to a Right shall be paid to the Right Holder thereof in an amount which, when taken together with the aggregate Nonqualifying Distributions paid to such Right Holder during any fiscal year, would cause such Right Holder's net yield in dollars (after Federal income tax consequences) from the aggregate of both the Nonqualifying Distributions and the cash receivable pursuant to such Right to be equal to the net yield in dollars (after Federal income tax consequences) which would have been received by such Right Holder if the amount of the aggregate Nonqualifying Distributions would have qualified for the Dividends-Received Deduction in the hands of such Right Holder. Such cash receivable on such Right shall be calculated without consideration being given to the time value of money and using the applicable maximum marginal corporate Federal tax rate in effect at the time such Right was declared.

The Corporation may estimate the amount payable in respect of any Right and pay all or any portion of such estimated amount prior to the end of the fiscal year in which such Right was declared.

If, for any fiscal year, all cash dividends paid at the Applicable Dividend Rate on the shares of RP are eligible in full for the Dividends-Received Deduction, then the amount payable to holders of Rights applicable to that year shall be zero.

4. Redemption. Shares of RP shall be redeemable by the Corporation as provided below:

(a) To the extent permitted under the 1940 Act and Maryland law, the Corporation at its option, upon giving a Notice of Redemption, may redeem shares of RP, in whole or in part, on the next succeeding scheduled Dividend Payment Date, out of funds legally available therefor, at a redemption price equal to $100,000 per share plus an amount equal to cash dividends thereon (whether or not earned or declared) accumulated but unpaid to the date fixed for redemption.

(d) Notwithstanding paragraph 4(c) of this Part I, if certificates representing shares of RP are held by Holders other than the Securities Depository or its nominee, then the number of shares of RP to be redeemed shall be determined by the Board of Directors and the shares to be redeemed shall be selected by the Corporation by lot.

(e) Any Notice of Redemption shall be given by the Corporation to the Paying Agent, the Securities Depository (and any other Holder) and the Remarketing Agent, by telephone, not later than 3:00 p.m., New York City time (and later confirmed in writing) on (A) in the case of optional redemption pursuant to paragraph 4(a) of this Part I (i) the Settlement Date in the case of a partial redemption of the shares of RP, (ii) the Tender Date in the case of a redemption in whole of the shares of RP or (iii) during a Non-Payment Period, the later of the Dividend Payment Date and the seventh day, in each case prior to the earliest date upon which any such redemption shall occur and (B) in the case of mandatory redemption pursuant to paragraph 4(b) of this Part I, on the fifth Business Day prior to the redemption date. In the case of a partial redemption of the shares of PR, the Paying Agent shall use reasonable efforts to provide telephonic notice to each Beneficial Owner of shares of RP called for redemption not later than the close of business on the Business Day on which the Paying Agent determines the shares to be redeemed, as described in paragraph 4(c) if this Part I (or, during a Non-Payment Period, not later than the close of business on the Business Day immediately following the day on which the Paying Agent receives a Notice of Redemption from the Corporation). In the case of a redemption in whole of the shares of RP, the Paying Agent shall use reasonable efforts to provide telephonic notice to each Beneficial Owner not later than the close of business on the Business Day immediately following the day on which it receives a Notice of Redemption from the Corporation. In any case described in clause (i) or (iii) of the first sentence of this paragraph 4(e), such telephonic notice shall be confirmed promptly in writing not later than the close of business on the third Business Day preceding the redemption date by notice sent by the Paying Agent to each Beneficial Owner of shares of RP called for redemption, the Remarketing Agent and the Securities Depository.

(f) Every Notice of Redemption and other redemption notice shall state: (i) the redemption date; (ii) the number of shares of RP to be redeemed; (iii) the redemption price; (iv) that dividends on the shares of RP to be redeemed shall cease to accumulate as of such redemption date; and (v) the provision pursuant to which such shares are being redeemed. In addition, notice of redemption given to a Beneficial Owner shall state the CUSIP number, if any, of the shares of RP to be redeemed and the manner in which the Beneficial Owners of such shares may obtain payment of the redemption price. No defect in the Notice of Redemption or other redemption notice or in the transmittal or the mailing thereof shall affect the validity of the redemption proceedings, except as required by applicable law. The Paying Agent shall use its reasonable efforts to cause the publication of a redemption notice in an Authorized Newspaper within two Business Days of the date of the Notice of Redemption, but failure so to publish such notification shall not affect the validity or effectiveness of any such redemption proceedings. Shares of RP the Beneficial Owners of which shall have been given Notice of Redemption shall not be subject to transfer outside a Remarketing.

(g) On any redemption date, the Corporation shall deposit, irrevocably in trust, in same-day funds, with the Paying Agent, by 12:00 noon, New York City time, the price to be paid on such redemption date of any shares of RP plus an amount equal to cash dividends thereon accumulated but unpaid to such redemption date (whether or not earned or declared). For the purposes of the foregoing, payment in New York Clearing House (next-day) funds at any time on any Business Day shall be considered equivalent to payment in same-day funds on the next Business Day at the same time, and any payment made after 12:00 noon, New York City time, on any Business Day shall be considered to have been made instead in the same form of funds before 12:00 noon, New York City time, on the next Business Day.

(h) In connection with any redemption, upon the giving of a Notice of Redemption and the deposit of the funds necessary for such redemption with the Paying Agent in accordance with this paragraph 4, all rights of the Holders of shares of RP so called for redemption shall cease and terminate, except the right of the Holders thereof to receive the redemption price thereof, inclusive of an amount equal to cash dividends (whether or not earned or declared) accumulated but unpaid to the redemption date but without any interest or other additional amount (except as provided in paragraph 3(h) or 3(l) of this Part I), and such shares shall no longer be deemed outstanding for any purpose. The Corporation shall be entitled to receive from the Paying Agent, promptly after the date fixed for redemption, any cash deposited with the Paying Agent as aforesaid in excess of the sum of (i) the aggregate redemption price of the shares of RP called for redemption on such date and (ii) all other amounts to which Holders of shares of RP called for redemption may be entitled. Any funds so deposited with the Paying Agent which are unclaimed at the end of ninety days from such redemption date shall, to the extent permitted by law, be repaid to the Corporation, after which time the Holders of shares of RP so called for redemption shall look only to the Corporation for payment of the redemption price and all other amounts to which they may be entitled. The Corporation shall be entitled to receive, from time to time after the date fixed for redemption, any interest on the funds so deposited.

(i) To the extent that any redemption for which Notice of Redemption has been given is not made by reason of the absence of legally available funds therefor, such redemption shall be made as soon as practicable to the extent such funds become available. Failure to redeem shares of RP shall be deemed to exist at any time after the date specified for redemption in a Notice of Redemption when the Corporation shall have failed, for any reason whatsoever, to deposit funds with the Paying Agent pursuant to paragraph 4(g) of this Part I with respect to any shares for which such Notice of Redemption has been given. Notwithstanding the fact that the Corporation shall not have redeemed shares of RP for which a Notice of Redemption has been given, dividends may be declared and paid on shares of RP and shall include those shares of RP for which a Notice of Redemption has been given.

(j) Notwithstanding the foregoing, (i) no share of RP may be redeemed pursuant to paragraph 4(a) of this Part I unless the full amount of accumulated but unpaid cash dividends to the date fixed for redemption for each such share of RP called for redemption shall have been declared, and (ii) no share of RP may be redeemed unless all outstanding shares of RP are simultaneously redeemed, nor may any shares of RP be purchased or otherwise acquired by the Corporation except in accordance with a purchase offer made on substantially equivalent terms by the Corporation for all outstanding shares of RP, unless, in each such instance, cash dividends on all outstanding shares of RP through the end of their most recently ended Dividend Period (or, if such transaction is on a Dividend Payment Date, through the Dividend Period ending on the day prior to such Dividend Payment Date) shall have been paid or declared and sufficient funds for the payment thereof deposited with the Payment Agent.

(k) Except as set forth in this paragraph 4 with respect to redemptions and subject to paragraph 4(j) hereof, nothing contained herein shall limit any legal right of the Corporation or any affiliate to purchase or otherwise acquire any share of RP at any price. Any shares of RP which have been redeemed, purchased or otherwise acquired by the Corporation or any affiliate thereof may be resold. In lieu of redeeming shares called for redemption, the Corporation shall have the right to arrange for other purchasers to purchase from Beneficial Owners all shares of RP to be redeemed pursuant to this paragraph 4 by their paying to such Beneficial Owners on or before the close of business on the redemption date an amount equal to not less than the redemption price payable by the Corporation on the redemption of such shares, and the obligation of the Corporation to pay such redemption price shall be satisfied and discharged to the extent such payment is so made by such purchasers.

(l) Notwithstanding any of the foregoing provisions of this paragraph 4, the Remarketing Agent may, in its sole discretion modify the procedures set forth above with respect to notification of redemption, provided that, any such modification does not adversely affect any Holder or Beneficial Owner of shares of RP.

5. Liquidation. (a) Upon a liquidation, dissolution or winding up of the affairs of the Corporation, whether voluntary or involuntary, the Holders shall be entitled, whether from capital or surplus, before any assets of the Corporation shall be distributed among or paid over to holders of Common Stock or any other class or series of stock of the Corporation junior to the RP as to liquidation payments, to be paid the amount of $100,000 per share of RP, plus an amount equal to all accumulated but unpaid dividends thereon (whether or not earned or declared) to and including the date of final distribution. After any such payment, the Holders shall not be entitled to any further participation in any distribution of assets of the Corporation.

(b) If, upon any such liquidation, dissolution or winding up of the Corporation, the assets of the Corporation shall be insufficient to make such full payments to the Holders and the holders of any Preferred Stock ranking as to liquidation, dissolution or winding up on a parity with the RP, then such assets shall be distributed among the Holders and such parity holders ratably in accordance with the respective amounts which would be payable on such shares of RP and any other such Preferred Stock if all amounts thereon where paid in full.

(c) Neither the consolidation nor the merger of the Corporation with or into any corporation or corporations nor a reorganization of the Corporation alone nor the sale or transfer by the Corporation of all or substantially all of its assets shall be deemed to be a dissolution or liquidation of the Corporation.

6. Voting Rights. (a) General. Each Holder of shares of RP shall be entitled to one vote for each share held on each matter submitted to a vote of stockholders of the Corporation and, except as otherwise provided in the 1940 Act, the Charter or the Bylaws or as described below, the holders of shares of Preferred Stock, including RP, and of shares of Common Stock shall vote together as one class. Prior to the issuance of any RP, the Board of Directors by resolution shall designate two existing directors representing holders of Preferred Stock. At the first meeting of stockholders for which the record date is a date on which shares of Preferred Stock are outstanding, the holders of Preferred Stock entitled to vote at such meeting shall have the right as a class, to the exclusion of the holders of the common stock, to elect two directors of the Corporation who shall serve for the unexpired terms of the directors originally designated by the Board of Directors as directors representing holders of Preferred Stock; except that, if such meeting is an annual meeting of stockholders at which the term of one of such designated directors expires, the director so elected to succeed the designated director shall be elected for a term expiring at the time of the third succeeding annual meeting of stockholders, or thereafter when his successor is elected and qualified. Thereafter, the holders of Preferred Stock shall have the right as a class, to the exclusion of the holders of the common stock, to elect directors to succeed either of the directors representing the Preferred Stock whose terms are expiring or whose seats on the Board of Directors are vacant. Subject to paragraph 6(b) hereof, the holders of a majority of the shares of Common Stock shall elect the balance of the directors.

(b) Right to Elect Majority of Board of Directors. During any period in which any one or more of the conditions described below shall exist (such period being referred to herein as a "Voting Period"), the number of directors constituting the Board of Directors shall be automatically increased by the smallest number that, when added to the number of directors then constituting the Board of Directors, shall (together with the two directors elected by the holders of Preferred Stock, including RP, pursuant to paragraph 6(a)) constitute a majority of such increased number, and the holders of a majority of Preferred Stock, including RP, shall be entitled, voting as a single class on a one-vote-per-share basis (to the exclusion of the holders of all other securities and classes of capital stock of the Corporation), to elect the smallest number of additional directors of the Corporation that shall constitute a majority of the total number of directors of the Corporation so increased. A Voting Period shall commence if at the close of business on any Dividend Payment Date accumulated dividends (whether or not earned or declared, and whether or not funds are then legally available in an amount sufficient therefor) on the outstanding shares of RP equal to at least two full years' dividends shall be due and unpaid and sufficient cash or specified securities shall not have been deposited with the Paying Agent for the payment of such accumulated dividends. Upon the termination of a Voting Period, the voting rights described in this paragraph 6(b) shall cease, subject always, however, to the revesting of such voting rights in the holders of Preferred Stock, including RP, upon the further occurrence of any of the events described in this paragraph 6(b).

(i) As soon as practicable after the accrual of any right of the holders of Preferred Stock, including RP, to elect a majority of directors, the Corporation shall notify the Paying Agent and Paying Agent shall call a special meeting of the holders of Preferred Stock, including RP, and shall mail a notice of such special meeting to such holders not less than 10 nor more than 20 days after the date of mailing of such notice. If the Corporation fails to send such notice to the Paying Agent or if the Paying Agent does not call such a special meeting, it may be called by any holder of Preferred Stock, including RP, on like notice. The record date for determining the holders of Preferred Stock, including RP, entitled to notice of and to vote at such special meeting shall be the close of business on the fifth Business Day preceding the day on which such notice is mailed. At any such special meeting and at each meeting held during a Voting Period, the holders of Preferred Stock, including RP, voting together as a class (to the exclusion of the holders of all other securities and classes of capital stock of the Corporation), shall be entitled to elect the number of directors prescribed in paragraph 6(b) above on a one-vote-per-share basis. At any such meeting or adjournment thereof in the absence of a quorum, a majority of the holders of Preferred Stock, including RP, present in person or by proxy, shall have the power to adjourn the meeting without notice, other than an announcement at the meeting, until a quorum is present; provided, however, that no such meeting may be adjourned to a date more than 120 days from the original record date without notice.

(ii) For purposes of determining any rights of the Holders to vote on any matter, whether such right is created by these Articles Supplementary, by statute or otherwise, no Holder shall be entitled to vote and no share of RP shall be deemed to be "outstanding" for the purpose of voting or determining the number of shares required to constitute a quorum, if, prior to or concurrently with the time of determination of shares entitled to vote or shares deemed outstanding for quorum purposes, as the case may be, sufficient funds for the redemption of such shares have been deposited in trust with the Paying Agent for that purpose and the requisite Notice of Redemption with respect to such shares shall have been given as provided in paragraph 4 of this Part I. No share of RP held by the Corporation or any affiliate of the Corporation shall have any voting rights or be deemed to be outstanding for voting purposes.

(iii) The terms of office of all persons who are directors of the Corporation at the time of a special meeting of holders of Preferred Stock, including RP, to elect directors shall continue, notwithstanding the election at such meeting by such holders of the number of directors that they are entitled to elect, and the persons so elected by such holders, together with the incumbent directors elected by the holders of the Common Stock, shall constitute the duly elected directors of the Corporation.

(iv) Simultaneously with the expiration of a Voting Period, the terms of office of the additional directors elected by the holders of Preferred Stock, including RP, shall terminate, the incumbent directors who shall have been elected by the holders of the Common Stock (or by the Board of Directors at a time which was not during a Voting Period) and the two incumbent directors the holders of Preferred Stock, including RP, have the right to elect in any event shall constitute the directors of the Corporation and the voting rights of such holders to elect additional directors shall cease.

(v) The directors elected by the holders of Preferred Stock, including RP, shall (subject to the provisions of any applicable law) be subject to removal only by the vote of the holders of a majority of the shares of Preferred Stock, including RP, outstanding. Any vacancy on the Board of Directors occurring by reason of such removal or otherwise may be filled only by vote of the holders of at least a majority of shares of Preferred Stock, including RP, outstanding, and if not so filled such vacancy shall (subject to the provisions of any applicable law) be filled by a majority of the remaining directors (or the remaining director) who were elected by such holders. Any other vacancy on the Board of Directors during a Voting Period shall be filled by a vote of the holder or holders of Common Stock.

(d) Exclusive Remedy. Unless otherwise required by law, the Holders of shares of RP shall not have any relative rights or preferences or other special rights other than those specifically set forth herein. The Holders of shares of RP shall have no preemptive rights. In the event that the Corporation fails to pay any dividends on the shares of RP, the exclusive remedy of the Holders shall be the right to vote for directors pursuant to the provisions of this paragraph 6. In no event shall the Holders of shares of RP have any right to sue for, or bring a proceeding with respect to, such dividends or redemptions or damages for the failure to receive the same.

7. 1940 Act RP Asset Coverage. The Corporation shall maintain, as of the last Business Day of each month in which any share of RP is outstanding, the 1940 Act RP Asset Coverage.

8. Asset and Liquidity Coverage.

(a) RP Basic Maintenance Amount. (i) The Corporation shall maintain, on each Valuation Date, Eligible Portfolio Property having an aggregate Discounted Value at least equal to the RP Basic Maintenance Amount.

(ii) On or before 5:00 p.m., New York City time, on the third Business Day after each Valuation Date, the Corporation shall complete and deliver to the Remarketing Agent and the Paying Agent an RP Basic Maintenance Report, which will be deemed to have been delivered to the Remarketing Agent and the Paying Agent if the Remarketing Agent and the Paying Agent receive a copy or telecopy, telex or other electronic transcription thereof and on the same day the Corporation mails to the Remarketing Agent and the Paying Agent for delivery on the next Business Day the full RP Basic Maintenance Report. A failure by the Corporation to deliver an RP Basic Maintenance Report under this paragraph 8(a)(ii) without the prior consent of the Remarketing Agent and the Paying Agent shall be deemed to be delivery of an RP Basic Maintenance Report indicating the Discounted Value for all assets of the Corporation is less than the RP Basic Maintenance Amount, as of the relevant Valuation Date.

(iii) Within ten Business Days after the date of delivery to the Remarketing Agent and the Paying Agent of an RP Basic Maintenance Report in accordance with paragraph 8(a)(ii) above relating to a Quarterly Valuation Date, the Independent Accountant will confirm in writing to the Remarketing Agent and the Paying Agent (A) the mathematical accuracy of the calculations reflected in such Report, (B) that, in such Report, the Corporation determined in accordance with these Articles Supplementary the assets of the Corporation which constitute Eligible Portfolio Property at such Quarterly Valuation Date, (C) that, in such Report, the Corporation determined in accordance with these Articles Supplementary whether the Corporation had, at such Quarterly Valuation Date, Eligible Portfolio Property of an aggregate Discounted Value at least equal to the RP Basic Maintenance Amount, (D) with respect to the S&P rating on Utility Bonds and Senior Debt Obligations, issuer name, issue size and coupon rate listed in such Report, that information has been traced and agrees with the information listed in The Standard & Poor's Bond Guide (in the event such information does not agree or such information is not listed in The Standard & Poor's Bond Guide, the Independent Accountant will inquire of S&P what such information is, and provide a listing in their letter of such differences, if any), (E) with respect to the Moody's ratings on Utility Bonds and Senior Debt Obligations, issuer name, issue size and coupon rate listed in such Report, that information has been traced and agrees with the information listed in Moody's Bond Record (in the event such information does not agree or such information is not listed in Moody's Bond Record, the Independent Accountant will inquire of Moody's what such information is, and provide a listing in their letter of such differences), and (F) with respect to the lower of two bid prices (or alternative permissible factors used in calculating the Market Value) provided by the custodian of the Corporation's assets to the Corporation for purposes of valuing securities in the Corporation's portfolio, the Independent Accountant has traced the price used in such Report to the lower of the two bid prices listed in the Report provided by such custodian and verified that such information agrees (in the event such information does not agree, the Independent Accountant will provide a listing in its letter of such differences) (such confirmation is herein called the "Accountant's Confirmation"). If any Accountant's Confirmation delivered pursuant to this paragraph 8(a)(iii) shows that an error was made in the RP Basic Maintenance Report for a Quarterly Valuation Date, or shows that a lower aggregate Discounted Value for the aggregate of all Eligible Portfolio Property of the Corporation was determined by the Independent Accountant, the calculation or determination made by such Independent Accountant shall be final and conclusive and shall be binding on the Corporation, and the Corporation shall accordingly amend the RP Basic Maintenance Report to the Remarketing Agent and Paying Agent promptly following receipt by the Remarketing Agent and the Paying Agent of such Accountant's Confirmation.

(b) Liquidity Coverage.

(i) As of each Valuation Date as long as any share of RP is outstanding, the Corporation shall determine (A) the Market Value of the Dividend Coverage Assets owned by the Corporation as of that Valuation Date, (B) the Dividend Coverage Amount on that Valuation Date, and (C) whether the Minimum Liquidity Level is met as of that Valuation Date. The calculations of the Dividend Coverage Assets, the Dividend Coverage Amount and whether the Minimum Liquidity Level is met shall be set forth in a certificate (a "Certificate of Minimum Liquidity") dated as of the Valuation Date. The RP Basic Maintenance Report and the Certificate of Minimum Liquidity may be combined in one certificate. The Corporation shall cause the Certificate of Minimum Liquidity to be delivered to the Remarketing Agent and the Paying Agent not later than the close of business on the third Business Day after the Valuation Date. The Minimum Liquidity Level shall be deemed to be met as of any date of determination if the Corporation has timely delivered a Certificate of Minimum Liquidity relating to such date, which states that the same has been met and which is not manifestly inaccurate. In the event that a Certificate of Minimum Liquidity is not delivered to the Remarketing Agent and the Paying Agent when required, the Minimum Liquidity Level shall be deemed not to have been met as of the applicable date.

(ii) If the Minimum Liquidity Level is not met as of any Valuation Date, then the Corporation shall purchase or otherwise acquire Dividend Coverage Assets (with the proceeds from the liquidation of Eligible Portfolio Property or otherwise) to the extent necessary so that the Minimum Liquidity Level is met as of the fifth Business Day following such Valuation Date. The Corporation shall, by such fifth Business Day, provide to the Paying Agent and the Remarketing Agent a Certificate of Minimum Liquidity setting forth the calculations of the Dividend Coverage Assets and the Dividend Coverage Amount and showing that the Minimum Liquidity Level is met as of such fifth Business Day together with a report of the custodian of the Corporation's assets confirming the amount of the Corporation's Dividend Coverage Assets as of such fifth Business Day.

9. Restrictions on Certain Distributions. For so long as any share of RP is outstanding, the Corporation shall not declare, pay or set apart for payment any dividend or other distribution (other than a dividend or distribution paid in shares of, or options, warrants or rights to subscribe for or purchase, Common Stock or other stock, if any, ranking junior to the shares of RP as to dividends or upon liquidation) in respect of the Common Stock or any other stock of the Corporation ranking junior to or on a parity with the shares of RP as to dividends or upon liquidation, or call for redemption, redeem, purchase or otherwise acquire for consideration any shares of the Common Stock or any other such junior stock (except by conversion into or exchange for stock of the Corporation ranking junior to the shares of RP as to dividends and upon liquidation) or any other such parity stock (except by conversion into or exchange for stock of the Corporation ranking junior to or on a parity with the shares of RP as to dividends and upon liquidation), unless (A) immediately after such transaction, the RP Basic Maintenance Amount and the 1940 Act RP Asset Coverage would be achieved, (B) full cumulative dividends on shares of RP and shares of Other RP due on or prior to the date of the transaction have been declared and paid or shall have been declared and sufficient funds for the payment thereof deposited with the Paying Agent, (C) any Right required to be paid under paragraph 3(l) of this Part I on or before the date of such declaration or payment has been paid and (D) the Corporation has redeemed the full number of shares of RP required to be redeemed by any provision for mandatory redemption contained herein.

10. Notice. All notices or communications, unless otherwise specified in the Bylaws of the Corporation or these Articles Supplementary, shall be sufficiently given if in writing and delivered in person or mailed by first-class mail, postage prepaid. Notice shall be deemed given on the earlier of the date received or the date seven days after which such notice is mailed.

11. Exchange Provisions. (a) Upon receipt by the Corporation of an opinion of legal counsel, in form and substance satisfactory to the Board of Directors, that dividends on the Corporation's Remarketed Preferred Stock, Series I will not be considered preferential under section 562(c) of the Code, which opinion may, but is not required to, rely upon a ruling on the matter by the Service, the Board of Directors may, but is not required to, adopt a resolution authorizing (such authorization shall be referred to herein as an "Exchange Event") that, on the first Dividend Payment Date for the RP which is at least 45 days after the occurrence of an Exchange Event and as of which the conditions described below have been satisfied (the "Exchange Date"), the RP will be exchanged automatically, and without any action or choice on the part of Holders thereof, on a share-for-share basis for the Corporation's Remarketed Preferred Stock, Series I. However, shares of RP will not be exchanged for shares of the Corporation's Remarketed Preferred Stock, Series I unless Moody's and S&P shall have issued on or before the Exchange Date ratings on the Corporation's Remarketed Preferred Stock, Series I equivalent to the ratings on the RP, provided that, if Moody's or S&P shall not make a rating available, such exchange will take place if a Substitute Rating Agency or Agencies shall have issued a rating or ratings which is/are equivalent to such then-current rating or ratings on the Exchange Date. Holders of outstanding shares of RP will receive one share of the Corporation's Remarketed Preferred Stock, Series I for each share of RP held and exchanged by them on the Exchange Date.

(b) The Fund will cause the publication of an exchange notice in an Authorized Newspaper, and cause the Paying Agent to mail an exchange notice to each Holder, not less than 10 nor more than 30 days prior to the Exchange Date. Such notice will state: (i) the Exchange Date, (ii) that on the Exchange Date all shares of Original RP will be exchanged automatically, and without any action or choice on the part of the Holders, on a share-for-share basis for the Corporation's Remarketed Preferred Stock, Series I, (iii) that the Initial Dividend Period for the Corporation's Remarketed Preferred Stock, Series I issuable in exchange for the RP will be a 49‑day Dividend Period commencing on the Exchange Date, and (iv) that dividends on shares of RP will cease to accumulate on the Exchange Date.

(c) On the Exchange Date, the RP will cease to accumulate dividends, the shares of RP will no longer be deemed outstanding, the rights of the Holders (except the right to receive accumulated but unpaid dividends to the Exchange Date) will cease, and the person or persons entitled to receive the Corporation's Remarketed Preferred Stock, Series I upon the exchange will be treated for all purposes as the holder or holders of such Remarketed Preferred Stock, Series I.

12. Borrowings. For so long as the shares of RP are rated by S&P, the aggregate amount of borrowings by the Corporation (including guarantees made by the Corporation) shall be limited to an amount equal to 10% of the value of the Corporation's assets; provided, further, that the Corporation shall not incur any such borrowings subsequent to the issuance of the RP unless S&P advises the Corporation in writing that such borrowings will not adversely affect its then-current rating on the RP.

13. Options and Futures Transactions. For so long as the shares of RP are rated by either Moody's or S&P, the Corporation will not purchase or sell futures contracts or related options or engage in reverse repurchase agreement transactions unless Moody's and/or S&P, as the case may be, advise the Corporation in writing that such action or actions will not adversely affect their then-current ratings on the RP.

14. Other Restrictions. For so long as the shares of RP are rated by S&P, the Corporation may not (i) engage in transactions involving repurchase obligations which do not constitute Short Term Money Market Instruments, (ii) engage in transactions involving short sales of portfolio securities or (iii) overdraw any bank accounts of the Corporation, unless, in each case, S&P advises the Corporation in writing that such action or actions will not adversely affect its then-current ratings on the RP.

PART II.

REMARKETING PROCEDURES

1. Remarketing Schedule. Each Remarketing shall take place over a three-day period consisting of the Tender Date, the Dividend Reset Date and the Settlement Date. Such dates or the method of establishing such dates shall be determined by the Board of Directors from time to time.

2. Procedure for Tendering. (a) Each share of RP is subject to Tender and Dividend Reset only at the end of each Dividend Period and may be tendered in a Remarketing only on the Tender Date immediately prior to the end of the current Dividend Period. By 12:00 noon, New York City time, on each such Tender Date, the Remarketing Agent shall, after canvassing the market and considering prevailing market conditions at the time for shares of RP and similar securities, provide Beneficial Owners non-binding indications of Applicable Dividend Rates for the next Dividend Period. The actual Applicable Dividend Rate for such Dividend Period may be greater than or less than the rate per annum indicated in such non-binding indications (but not greater than the applicable Maximum Dividend Rate). By 1:00 p.m., New York City time, on such Tender Date, each Beneficial Owner of shares of RP must notify the Remarketing Agent of its desire, on a share-by-share basis, either to tender such share of RP at a price of $100,000 per share or to continue to hold such share of RP for the next Dividend Period. Any notice given to the Remarketing Agent to tender or hold shares for a particular Dividend Period shall be irrevocable and shall not be conditioned upon the level at which the Applicable Dividend Rate is established. Any such notice may not be waived by the Remarketing Agent, except that prior to 4:00 p.m., New York City time, on the Dividend Reset Date, the Remarketing Agent may, in its sole discretion (i) at the request of a Beneficial Owner that has tendered one or more shares to the Remarketing Agent, contingently waive such Beneficial Owner's tender and thereby enable such Beneficial Owner to continue to hold the share or shares for the next Dividend Period as agreed to by such Beneficial Owner and the Remarketing Agent at such time, so long as such tendering Beneficial Owner has indicated to the Remarketing Agent that it would accept the new Applicable Dividend Rate for such Dividend Period, such waiver to be contingent upon the Remarketing Agent's ability to remarket all shares of RP tendered in such Remarketing, and (ii) at the request of a Beneficial Owner that has elected to hold one or more of its shares of RP, waive such Beneficial Owner's election with respect thereto.

(b) The right of each Beneficial Owner to tender shares of RP in a Remarketing therefor shall be limited to the extent that (i) the Remarketing Agent conducts a Remarketing pursuant to the terms of the Remarketing Agreement, (ii) shares tendered have not been called for redemption and (iii) the Remarketing Agent is able to find a purchaser or purchasers for tendered shares of RP at an Applicable Dividend Rate for the next Dividend Period that is not in excess of the Maximum Dividend Rate.

3. Determination of Applicable Dividend Rates. (a) Between 1:00 p.m., New York City time, on each Tender Date and 4:00 p.m., New York City time, on the succeeding Dividend Reset Date, the Remarketing Agent shall determine the Applicable Dividend Rate to the nearest one-thousandth (0.001) of one percent per annum for the next Dividend Period. The Applicable Dividend Rate for such Dividend Period, except as otherwise required herein, shall be the rate per annum which the Remarketing Agent determines, in its sole judgment, to be the lowest rate, giving effect to such allocation, that will enable it to remarket on behalf of the Beneficial Owners thereof all shares of RP tendered to it at a price of $100,000 per share.

(b) If no Applicable Dividend Rate shall have been established on a Dividend Reset Date in a Remarketing for the next Dividend Period for any reason (other than because there is no Remarketing Agent or the Remarketing Agent is not required to conduct a Remarketing pursuant to the terms of the Remarketing Agreement), then the Remarketing Agent, except during a Non-Payment Period, in its sole discretion, shall, after taking into account market conditions as reflected in the prevailing yields of fixed and variable rate taxable and tax-exempt debt securities and the prevailing dividend yields of fixed and variable rate preferred stock, if necessary, determine the Applicable Dividend Rate that would be the initial dividend rate fixed in an offering on such Dividend Reset Date, assuming in each case a comparable dividend period, issuer and security. If there is no Remarketing because there is no Remarketing Agent or the Remarketing Agent is not required to conduct a Remarketing pursuant to the Remarketing Agreement, then, except during a Non-Payment Period, the Applicable Dividend Rate for each subsequent Dividend Period for which no Remarketing takes place because of the foregoing shall be the applicable Maximum Dividend Rate.

(c) In determining such Applicable Dividend Rate, the Remarketing Agent shall, after taking into account market conditions as reflected in the prevailing yields of fixed and variable rate taxable and tax-exempt debt securities and the prevailing dividend yields of fixed and variable rate preferred stock, in providing non-binding indications of the Applicable Dividend Rate to Beneficial Owners and potential purchasers of shares of RP, (i) consider the number of shares of RP tendered and the number of shares of RP potential purchasers are willing to purchase and (ii) contact by telephone or otherwise current and potential Beneficial Owners of shares of RP and ascertain the dividend rates at which they would be willing to hold shares of RP.

(d) The Applicable Dividend Rate shall be determined as aforesaid by the Remarketing Agent in its sole discretion (except as otherwise provided in these Articles Supplementary with respect to Applicable Dividend Rates that shall be the Non-Payment Period Rate and Maximum Dividend Rate) and shall be conclusive and binding on Holders and Beneficial Owners.

(e) As a condition precedent to purchasing shares of RP in any offering, in any Remarketing or outside any Remarketing, each purchaser of shares of RP shall sign and deliver a Master Purchaser's Letter, the sufficiency of any Master Purchaser's Letter to be determined by the Remarketing Agent in its sole discretion.

(f) Except during a Non-Payment Period, the Applicable Dividend Rate for any Dividend Period shall not be more than the applicable Maximum Dividend Rate.

(b) If the allocation procedures described above would result in the sale of a fraction of a share of RP, the Remarketing Agent shall, in its sole discretion, round up or down the number of shares of RP sold by each Beneficial Owner on such Dividend Reset Date so that each share sold by a Beneficial Owner shall be a whole share of RP and the total number of shares sold equals the total number of shares bought on such Dividend Reset Date.

5. Notification of Results; Settlement. (a) By telephone at approximately 4:30 p.m., New York City time, on each Dividend Reset Date the Remarketing Agent shall advise each Beneficial Owner of tendered shares and each purchaser thereof (or the Agent Member thereof) (i) of the number of shares such Beneficial Owner or purchaser is to sell or purchase and (ii) to give instructions to its Agent Member to deliver such shares against payment therefor or to pay the purchase price against delivery as appropriate. The Remarketing Agent will also advise each Beneficial Owner or purchaser that is to continue to hold, or to purchase, shares for the Dividend Periods beginning on the Business Day following such Dividend Reset Date of the Applicable Dividend Rate for such Dividend Period.

(b) In accordance with the Securities Depository's normal procedures, on the Settlement Date, the transactions described above with respect to each share of RP shall be executed through the Securities Depository, if the Securities Depository or its nominee holds or is to hold the certificates relating to the shares to be purchased, and the accounts of the respective Agent Members of the Securities Depository shall be debited and credited and shares delivered by book entry as necessary to effect the purchases and sales of shares of RP. Purchasers of shares of RP shall make payment to the Paying Agent in same-day funds against delivery to other purchasers or their nominees of one or more certificates representing shares of RP, or, if the Securities Depository or its nominee holds or is to hold the certificates relating to the shares to be purchased, through their Agent Members in same-day funds to the Securities Depository against delivery through their Agent Members by book entry of shares of RP or as otherwise required by the Securities Depository. The Securities Depository shall make payment in accordance with its normal procedures.

(c) If any Beneficial Owner selling shares of RP in a Remarketing fails to deliver such shares, the Agent Member of such selling Beneficial Owner and of any other person that was to have purchased shares of RP in such Remarketing may deliver to any such other person a number of whole shares of RP that is less than the number of shares that otherwise was to be purchased by such person. In such event, the number of shares of RP to be so delivered shall be determined by such Agent Member. Delivery of such lesser number of shares of RP shall constitute good delivery.

(d) The Remarketing Agent, the Paying Agent and the Securities Depository each will use its reasonable commercial efforts to meet the timing requirements set forth in paragraphs (a) and (b) above; provided that, in the event that there is a delay in the occurrence of any delivery or other event connected with a Remarketing, the Remarketing Agent, the Paying Agent and the Securities Depository each will use its reasonable commercial efforts to accommodate such delay in furtherance of the Remarketing.

(e) Notwithstanding any of the foregoing provisions of this paragraph 5, the Remarketing Agent may, in its sole discretion, modify the settlement procedures set forth above with respect to settlement, provided any such modification does not adversely affect the Beneficial Owners or the Holders of RP or the Corporation.

6. Purchase of Shares of RP by Remarketing Agent. The Remarketing Agent may purchase for its own account shares of RP in a Remarketing, provided that it purchases all tendered (or deemed tendered) shares of RP not sold in such Remarketing to other purchasers and that the Applicable Dividend Rate established in such Remarketing is no higher than the Applicable Dividend Rate that would have been established if the Remarketing Agent had not purchased such shares. Except as provided in the previous sentence, the Remarketing Agent shall not be obligated to purchase any shares of RP that would otherwise remain unsold in a Remarketing. If the Remarketing Agent owns any shares of RP subject to a Remarketing immediately prior to a Remarketing and if all other shares subject to such Remarketing and tendered for sale by other Beneficial Owners of shares of RP have been sold in such Remarketing, then the Remarketing Agent may sell such number of its shares in such Remarketing as there are outstanding orders to purchase that have not been filled by such shares tendered for sale by other Beneficial Owners. Neither the Corporation, the Paying Agent nor the Remarketing Agent shall be obligated in any case to provide funds to make payment to a Beneficial Owner upon such Beneficial Owner’s tender of its shares of RP in a Remarketing.

7. Applicable Dividend Rate During a Non-Payment Period. So long as a Non-Payment Period shall continue, paragraphs 1, 2, 3, 4, 5, and 6 of this Part II shall not be applicable to any of the shares of RP and the shares of RP shall not be subject to Tender and Dividend Reset.

8. Transfers. As a condition precedent to purchasing shares of RP in any offering, in any Remarketing or outside any Remarketing, each purchaser of shares of RP shall be required to sign and deliver a Master Purchaser’s Letter, the sufficiency of any Master Purchaser’s Letter to be determined by the Remarketing Agent in its sole discretion, in which such purchaser shall agree, among other things, (i) unless the Corporation has elected, during a Non-Payment Period, to waive this requirement, to have its ownership of such shares of RP maintained in book entry form by the Securities Depository, in the account of a designated Agent Member which, in turn, shall maintain records of such purchaser's beneficial ownership, (ii) to be conclusively bound by the remarketing procedures, including the Remarketing Agent's determination of the Applicable Dividend Rates, pursuant to the remarketing procedures, (iii) that its notice to tender shares of RP in a Remarketing will constitute an irrevocable offer, except as set forth in such Master Purchaser's Letter, to sell the shares specified in such notice and authorization to the Remarketing Agent to sell, transfer or otherwise dispose of such shares as set forth herein and (v) unless the Corporation shall have elected, during a Non-Payment Period, to waive this requirement, to sell, transfer or otherwise dispose of any share of RP held by it only pursuant to orders placed in a Remarketing therefor or to a person that has signed and delivered a Master Purchaser's Letter as provided herein, and, in the case of any transfer other than pursuant to a Remarketing, to ensure that an Agent Member advises the Remarketing Agent of such transfer. The Agent Member shall be authorized and instructed to disclose to the Remarketing Agent and/or the Paying Agent such information with respect to such purchaser's beneficial ownership as the Remarketing Agent or Paying Agent shall request.

9. Miscellaneous. To the extent permitted by applicable law, the Board of Directors of the Corporation may interpret or adjust the provisions hereof to resolve any inconsistency or ambiguity, remedy any formal defect or make any other change or modification which does not adversely affect the rights of Holders or Beneficial Owners of shares of RP and if such inconsistency or ambiguity reflects an incorrect provision hereof then the Board of Directors may authorize the filing of a Certificate of Amendment or a Certificate of Correction, as the case may be.

10. Securities Depository; Stock Certificates. (a) If there is a Securities Depository, one certificate for all of the shares of RP shall be issued to the Securities Depository and registered in the name of the Securities Depository or its nominee. Such certificate shall bear a legend to the effect that such certificate is issued subject to the provisions contained in these Articles Supplementary and each Master Purchaser's Letter. Unless the Corporation shall have elected, during a Non-Payment Period, to waive this requirement, the Corporation will also issue stop-transfer instructions to the Paying Agent for the shares of RP. Except as provided in paragraph (b) below, the Securities Depository or its nominee will be the Holder, and no Beneficial Owner shall receive certificates representing its ownership interest in such shares.

(b) If the Applicable Dividend Rate applicable to all shares of RP shall be the Non-Payment Period Rate or there is no Securities Depository, the Corporation may at its option issue one or more new certificates with respect to such shares (without the legend referred to in paragraph 10(a) of this Part II) registered in the names of the Beneficial Owners or their nominees and rescind the stop-transfer instruction referred to in paragraph 10(a) of this Part II with respect to such shares.

IN WITNESS WHEREOF, DUFF & PHELPS SELECTED UTILITIES INC. has caused these presents to be signed in its name and on its behalf by its President, and its corporate seal to be hereunto affixed and attested by its Secretary, and the said officers of the Corporation further acknowledged said instrument to be the corporate act of the Corporation, and stated under the penalties of perjury that to the best of their knowledge, information and belief the matters and facts therein set forth with respect to approval are true in all material respects, all on November 15, 1988.

DUFF & PHELPS SELECTED UTILITIES INC.

                                                By /s/ Claire V. Hansen
                                                         Claire V. Hansen
                                                         Chairman

Attest:

/s/ Richard J. Spletzer
Richard J. Spletzer, Assistant Secretary

EX-99.2A CHARTER 6 ex_a4.htm ex_a4