CORNERSTONE TOTAL RETURN FUND, INC.
383 Madison Avenue
New York, New York 10179
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NOTICE OF SPECIAL MEETING OF STOCKHOLDERS
To Be Held on October XX, 2008
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NOTICE IS HEREBY GIVEN that the Special Meeting of Stockholders (the "Meeting")
of Cornerstone Total Return Fund, Inc., a New York corporation (the "Fund"),
will be held at 11:00 a.m., eastern time, on October XX, 2008 at Fifth Floor
Conference Room, One West Pack Square, Asheville, NC 28801, for the following
purposes:
1. To approve a proposed one-for-two reverse stock split and the
amendment to the Certificate of Incorporation. (Proposal No. 1); and
2. To consider and vote upon such other matters as may properly come
before said Meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on August 18, 2008 as the
record date for the determination of stockholders entitled to notice of, and to
vote, at this Meeting or any adjournment thereof. The stock transfer books will
not be closed.
Copies of the Fund's most recent annual report may be ordered free of charge by
any stockholder by writing to the Fund, c/o Bear Stearns Funds Management Inc.,
383 Madison Avenue, 23rd Floor, New York, New York 10179, or by calling collect
(212) 272-3550.
By Order of the Board of Directors
Gary A. Bentz
Secretary
Dated: August XX, 2008
WHETHER OR NOT YOU EXPECT TO BE PRESENT AT THE MEETING, PLEASE FILL IN, DATE,
SIGN AND MAIL THE ENCLOSED PROXY CARD IN THE ENCLOSED REPLY ENVELOPE. YOUR
PROMPT RESPONSE WILL ASSURE A QUORUM AT THE MEETING.
INSTRUCTIONS FOR SIGNING PROXY CARDS
The following general rules for signing proxy cards may be of assistance
to you and may allow the Fund to avoid the time and expense involved in
validating your vote if you fail to sign your proxy card properly.
1. Individual Accounts: Sign your name exactly as it appears in the
registration on the proxy card.
2. Joint Accounts: Either party may sign, but the name of the party
signing should conform exactly to a name shown in the registration.
3. Other Accounts: The capacity of the individual signing the proxy
card should be indicated unless it is reflected in the form of
registration. For example: REGISTRATION
CORPORATE ACCOUNTS VALID SIGNATURE
(1) ABC Corp. ABC Corp. (by John Doe, Treasurer)
(2) ABC Corp. John Doe, Treasurer
(3) ABC Corp.
c/o John Doe, Treasurer John Doe
(4) ABC Corp. Profit Sharing Plan John Doe, Trustee
TRUST ACCOUNTS
(1) ABC Trust Jane B. Doe, Trustee
(2) Jane B. Doe, Trustee u/t/d/ 12/28/78 Jane B. Doe
CUSTODIAL OR ESTATE ACCOUNTS
(1) John B. Smith, Cust.
f/b/o John B. Smith, Jr. UGMA. John B. Smith
(2) John B. Smith John B. Smith, Jr., Executor
CORNERSTONE TOTAL RETURN FUND, INC.
383 Madison Avenue
New York, New York 10179
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PROXY STATEMENT FOR SPECIAL MEETING OF STOCKHOLDERS
to be held on October XX, 2008
-------------------------------
GENERAL
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Cornerstone Total Return Fund, Inc., a New
York corporation (the "Fund") for use at the Special Meeting of Stockholders
(the "Meeting") to be held at 11:00 a.m., eastern time, on October XX, 2008 at
the Fifth Floor Conference Room, One West Pack Square, Asheville, NC 28801, and
at any and all adjournments thereof. A form of proxy is enclosed herewith. This
Proxy Statement and the accompanying form of proxy are being first mailed to
stockholders of the Fund ("Stockholder(s)") on or about August 29, 2008.
Any Stockholder who executes and delivers a proxy may revoke it by written
communication to the Secretary of the Fund at any time prior to its use or by
voting in person at the Meeting. Attendance by a Stockholder at the Meeting does
not, in itself, revoke a proxy. Unrevoked proxies will be voted in accordance
with the specifications thereon and, unless specified to the contrary, will be
voted FOR the approval of the proposed reverse stock split and the amendment to
the Certificate of Incorporation.
In general, abstentions and broker non-votes, as defined below, count for
purposes of obtaining a quorum but do not count as votes cast with respect to
any proposal where the broker does not have discretion. Since Proposal 1 is
considered routine, broker non-votes will be counted as votes cast. A broker
non-vote is a proxy from a broker or nominee indicating that such person has not
received instructions from the beneficial owner or other person entitled to vote
shares on a particular matter with respect to which the broker or nominee does
not have discretionary voting power.
At least 51% of the Fund's Stockholders must be present at the Meeting in
person or by proxy to constitute a quorum for the transaction of business by the
Fund. In the event that a quorum is not present at the Meeting, the persons
named as proxies may propose one or more adjournments of the Meeting from time
to time. Any such adjournment will require the affirmative vote of a majority of
those shares represented at the Meeting in person or by proxy. The persons named
as proxies will vote those proxies which they are entitled to vote FOR or
AGAINST any such proposal in their discretion.
The cost of soliciting the proxies will be borne by the Fund. Proxy
solicitations will be made primarily by mail, but solicitations may also be made
by telephone, telegraph or personal interviews conducted by officers of the Fund
or Bear Stearns Funds Management Inc., the administrator to the Fund (the
"Administrator").
Only holders of issued and outstanding shares of the Fund's common stock
of record at the close of business on August 18, 2008 are entitled to notice of,
and to vote at, the Meeting. Each such holder is entitled to one vote per share
of common stock so held. The number of shares of common stock outstanding on
August 18, 2008 was XXX. The Fund is a diversified closed-end management
investment company.
Copies of the Fund's most recent annual report may be ordered free of
charge to any Stockholder by writing to the Fund, c/o Bear Stearns Funds
Management Inc., 383 Madison Avenue, New York, New York 10179, or by telephone
by calling the Fund collect at (212) 272-3550. This report is not to be regarded
as proxy-soliciting material.
This Proxy Statement is first being mailed to Stockholders on or about
August 29, 2008.
PROPOSAL NO. 1
APPROVAL OF ONE-FOR-TWO REVERSE STOCK SPLIT OF
THE ISSUED AND OUTSTANDING SHARES OF COMMON STOCK
AND THE AMENDMENT TO THE CERTIFICATE OF INCORPORATION
The Board of Directors has determined that it is in the best interests of
the Fund and the stockholders to approve an amendment to the Fund's Certificate
of Incorporation to effect a reverse stock split of the Fund's common stock on
the basis of one new share of common stock for each two shares (1-for-2) of
presently outstanding common stock. The amendment to the Certificate of
Incorporation, attached hereto as Exhibit A, would reduce the number of shares
that are issued and outstanding as of the date of the amendment but would not
have any other effect or change the Fund's Certificate of Incorporation or the
rights of stockholders in any other way.
On August 15, 2008, the Board discussed the Fund's current market price
per share and compared it to the Fund's historical market prices per share.
Although no assurances can be given, the Board believes that a reverse stock
split may have the effect of increasing the Fund's market price and net asset
value ("NAV") per share. Please refer to the section entitled "Potential Effects
of the Reverse Stock Split" below for the risks associated with the reverse
stock split.
Upon receiving the requisite shareholder approval, the Certificate of
Amendment will, subject to the discretion of the Board, be thereafter filed with
the Secretary of State of the State of New York. The amendment and the proposed
Reverse Stock Split would become effective as of the date of such filing which
is anticipated to be in December, 2008 (the "Effective Date").
The Certificate of Amendment to the Certificate of Incorporation will not
reduce the total number of authorized shares of capital stock of XXX shares, or
the par value of the Fund's common stock. As of August XX, XXX shares of common
stock were issued and outstanding.
POTENTIAL EFFECTS OF THE REVERSE STOCK SPLIT
The immediate effect of a reverse stock split would be to reduce the
number of shares of common stock outstanding, thereby increasing the NAV per
share. A reverse stock split may result in an increase in the market price of
the Fund's common stock. However, the effect of any reverse stock split upon the
market price of the Fund's common stock cannot be predicted. The Fund cannot
assure stockholders that the market price of its common stock after the reverse
stock split will rise in exact proportion to the reduction in the number of
shares of common stock outstanding. Also, there can be no assurance that a
reverse stock split would lead to a sustained increase in the market price of
the Fund's common stock, that the market price would remain above the thresholds
required by the American Stock Exchange ("AMEX"), or that the Fund will be able
to continue to meet any other continued listing requirements of the AMEX.
EFFECTS ON OWNERSHIP BY INDIVIDUAL STOCKHOLDERS
If the Fund implements a reverse stock split, the number of shares of
common stock held by each stockholder would be reduced by dividing the number of
shares held immediately before the reverse split by the 1 for 2 exchange ratio.
The Fund will not issue factional shares. Instead, the Fund will pay cash in
lieu of any fractional interest in a share to which such stockholder would
otherwise be entitled as a result of the reverse split. The reverse stock split
would affect the Fund's common stock uniformly and would not affect any
stockholder's percentage ownership interests in the Company or proportionate
voting power.
OTHER EFFECTS ON OUTSTANDING SHARES. The reverse stock split may result in some
stockholders owning "odd-lots" of less than 100 shares of common stock.
Brokerage commissions and other costs of transactions in odd-lots may be higher
than the costs of transactions in "round-lots" of even multiples of 100 shares.
PROCEDURE FOR EFFECTING THE REVERSE STOCK SPLIT AND EXCHANGE OF STOCK
CERTIFICATES
If the stockholders approve the proposed amendment to the Fund's
Certificate of Incorporation, the Board of Directors may elect whether or not to
declare the reverse stock split at any time after the Meeting. The reverse stock
split would be implemented by filing the Certificate of Amendment to the
Certificate of Incorporation with the Secretary of State of the State of New
York, and the reverse stock split would become effective on the date of the
filing which is anticipated to be in December, 2008.
As of the effective date of a reverse stock split, each certificate
representing shares of the Fund's common stock before the reverse stock split
would be deemed, for all corporate purposes, to evidence ownership of the
reduced number of shares of common stock resulting from the reverse stock split.
The Fund expects that its transfer agent would act as the exchange agent
for purposes of implementing the exchange of stock certificates. As soon as
practicable after the effective date, stockholders would be notified of the
effectiveness of the reverse split. Stockholders of record would receive a
letter of transmittal requesting them to surrender their stock certificates for
stock certificates reflecting the adjusted number of shares as a result of the
reverse stock split. Persons who hold their shares in brokerage accounts or
"street name" would not be required to take any further actions to effect the
exchange of their certificates. No new certificates would be issued to a
stockholder until the stockholder has surrendered the stockholder's outstanding
certificate(s) together with the properly completed and executed letter of
transmittal to the exchange agent. Until surrender, each certificate
representing shares before the reverse stock split would continue to be valid
and would represent the adjusted number of shares based on the exchange ratio of
the reverse stock split. Stockholders should not destroy any stock certificate
and should not submit any certificates until they receive a letter of
transmittal.
FRACTIONAL SHARES
The Fund will not issue factional shares. Instead, the Fund will pay cash
in lieu of any fractional interest in a share to which such stockholder would
otherwise be entitled as a result of the reverse split.
NO APPRAISAL RIGHTS
No appraisal rights are available under the New York Business Corporation
Law (NYBCL) with respect to the reverse stock split, and we will not
independently provide stockholders with any such rights. There may exist other
rights or actions under state law for stockholders who are aggrieved by reverse
stock splits generally.
ACCOUNTING CONSEQUENCES
The reverse stock split will not affect the par value of our common stock.
As a result, on the effective date of the reverse stock split, the stated
capital on our balance sheet attributable to our common stock will be reduced in
proportion with the exchange ratio, and the additional paid-in capital account
will be credited with the amount by which the stated capital is reduced.
U.S. FEDERAL INCOME TAX CONSEQUENCES
The following is a summary of material U.S. federal income tax
consequences of the reverse stock split and does not purport to be complete. It
does not discuss any state, local, or foreign income or other tax consequences.
Also, it does not address the tax consequences to holders that are subject to
special tax rules, including banks, insurance companies, regulated investment
companies, personal holding companies, foreign entities, nonresident alien
individuals, broker-dealers and tax-exempt entities. The discussion is based on
the provisions of the United States federal income tax law as of the date
hereof, which is subject to change retroactively as well as prospectively. This
summary also assumes that the shares are held as a "capital asset," as defined
in the Internal Revenue Code of 1986, as amended (generally, property held for
investment). The tax treatment of a stockholder may vary depending upon the
particular facts and circumstances of the stockholder. Each stockholder is urged
to consult with the stockholder's own tax advisor with respect to the
consequences of the reverse stock split.
The Fund intends to treat the exchange of shares pursuant to the reverse
stock split as a recapitalization under Section 368(a)(i)(E) of the Code. No
gain or loss should be recognized by a stockholder upon the stockholder's
exchange of shares pursuant to the reverse stock split. The aggregate tax basis
of the shares received in the reverse stock split, including any fraction of a
share deemed to have been received, would be the same as the stockholder's
aggregate tax basis in the shares exchanged. The stockholder's holding period
for the shares would include the period during which the stockholder held the
pre-split shares surrendered in the reverse stock split.
Our view regarding the tax consequence of the reverse stock split is not
binding upon the Internal Revenue Service or the courts, and there can be no
assurance that the Internal Revenue Service or the courts will accept the
positions expressed above. The state and local tax consequences of the reverse
stock split may vary significantly as to each stockholder, depending upon the
state in which he or she resides. ACCORDINGLY, EACH STOCKHOLDER SHOULD CONSULT
WITH HIS OR HER OWN TAX ADVISOR WITH RESPECT TO ALL OF THE POTENTIAL TAX
CONSEQUENCES OF THE REVERSE STOCK SPLIT.
The following notice is based on U.S. Treasury Regulations governing
practice before the Internal Revenue Service: (1) any U.S. federal tax advice
contained herein is not intended or written to be used, and cannot be used by
any taxpayer, for the purpose of avoiding U.S. federal tax penalties that may be
imposed on the taxpayer, (2) any such advice is written to support the promotion
of the transactions described in this proxy statement, and (3) each taxpayer
should seek advice based on the taxpayer's particular circumstances from an
independent tax advisor.
REQUIRED VOTE
The affirmative vote of a majority of all outstanding shares of common
stock of the Company entitled to vote at the Meeting is required for approval of
the reverse stock split and the amendment to the Certificate of Incorporation.
Abstentions and broker non-votes will have the same effect as a vote against the
proposal.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE "FOR" APPROVAL OF THE
PROPOSED REVERSE STOCK SPLIT AND THE AMENDMENT TO THE CERTIFICATE OF
INCORPORATION.
INFORMATION PERTAINING TO THE FUND'S INVESTMENT ADVISER AND ADMINISTRATOR
THE INVESTMENT ADVISER
Cornerstone Advisors, Inc. has acted as the Fund's Investment Adviser
("Investment Adviser") since January 2, 2002, and has its principal office at
One West Pack Square, Suite 1650, Asheville, North Carolina 28801. Cornerstone
Advisors, Inc. was organized in February of 2001, to provide investment
management services to closed-end investment companies and is registered with
the SEC under the Investment Advisers Act of 1940, as amended. Cornerstone
Advisors, Inc. is the Investment Adviser to other closed-end funds, Cornerstone
Strategic Value Fund, Inc. and Cornerstone Progressive Return Fund. Messrs.
Bradshaw, Bentz and Clark are the only stockholders of the Investment Adviser.
Mr. Bradshaw, an owner of Cornerstone Advisors, Inc., is President and
Chairman of the Board of Directors of the Fund. Mr. Bentz, formerly the Vice
President, Treasurer and a Director of the Fund and currently Chief Compliance
Officer and Secretary of the Fund, and Mr. Clark, formerly a Director and
currently Vice President of the Fund, are also owners of Cornerstone Advisors,
Inc. The address of Messrs. Bradshaw, Bentz, and Clark is One West Pack Square,
Suite 1650, Asheville, North Carolina 28801.
THE ADMINISTRATOR
Bear Stearns Funds Management Inc., a J.P. Morgan Company, whose address
is 383 Madison Avenue, 23rd Floor, New York, New York 10179, currently acts as
the Administrator of the Fund.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 (the "Exchange Act")
and Section 30(h) of the Investment Company Act in combination require the
Fund's directors and officers, persons who own more than ten (10%) of the Fund's
Common Stock, and the Fund's Investment Adviser and its directors and officers,
to file reports of ownership and changes in ownership with the SEC and the AMEX.
The Fund believes that the Fund's directors and officers, the Fund's Investment
Adviser and its directors and officers have complied with all applicable filing
requirements during the year ended December 31, 2007.
INFORMATION PERTAINING TO CERTAIN STOCKHOLDERS
The following table sets forth the beneficial ownership of shares of the
Fund by each person known to the Fund to be deemed the beneficial owner of more
than five (5%) percent of the outstanding shares of the Fund at the close of
business on August XX, 2008:
NAME AND ADDRESS OF BENEFICIAL OWNER SHARES OF COMMON STOCK BENEFICIALLY OWNED
--------------------------------------------------------------------------------
None
Additionally, on August 18, 2008, Cede & Co., a nominee for participants
in the Depository Trust Company, held of record XXX shares of the Fund, equal to
approximately XXX% of the outstanding shares of the Fund. All the directors and
executive officers of the Fund, as of the date of this proxy, owned less than 1%
of the outstanding shares of the Fund.
ADDITIONAL INFORMATION
The Proxy Statement does not contain all of the information set forth in
the registration statements and the exhibits relating thereto which the Fund has
filed with the SEC, under the Exchange Act and the Investment Company Act, to
which reference is hereby made.
The Fund is subject to the informational requirements of the Exchange Act
and in accordance therewith, files reports and other information with the SEC.
Reports, proxy statements, registration statements and other information filed
by the Fund can be inspected and copied at the public reference facilities of
the SEC in Washington, DC. Copies of such materials also can be obtained by mail
from the Public Reference Branch, Office of Consumer Affairs and Information
Services, SEC, 100 F Street, NE, Washington, DC 20594, at prescribed rates.
OTHER BUSINESS
The Board of Directors of the Fund does not know of any other matter which
may come before the Meeting, but should any other matter requiring a vote of
Stockholders arise, including any questions as to the adjournment of the
Meeting, it is the intention of the persons named in the proxy to vote the
proxies in accordance with their judgment on that matter in the interest of the
Fund.
PROPOSALS TO BE SUBMITTED BY STOCKHOLDERS
All proposals by Stockholders of the Fund which are intended to be
presented at the Fund's next Annual Meeting of Stockholders, to be held in the
year 2009, must be received by the Fund addressed to Cornerstone Total Return
Fund, Inc., c/o Bear Stearns Funds Management Inc., 383 Madison Avenue, 23rd
Floor, New York, New York 10179 in advance of the meeting as set forth in the
Fund's 2008 annual meeting proxy document.
CORNERSTONE TOTAL RETURN FUND, INC.
Gary A. Bentz, Secretary
Dated: August XX, 2008
CORNERSTONE TOTAL RETURN FUND, INC.
PROXY CARD FOR THE SPECIAL MEETING OF STOCKHOLDERS
TO BE HELD ON OCTOBER XX, 2008
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned stockholder of Cornerstone Total Return Fund, Inc. (the
"Fund") hereby constitutes and appoints Messrs. William A. Clark, Andrew A.
Strauss, and Glenn W. Wilcox, Sr., or any of them, the action of a majority of
them voting to be controlling, as proxy of the undersigned, with full power of
substitution, to vote all shares of common stock of the Fund standing in his or
her name on the books of the Fund at the Special Meeting of Stockholders of the
Fund to be held at Fifth Floor Conference Room, One West Pack Square, Asheville,
NC 28801, on October XX, 2008 at 11:00 a.m., Eastern Time, or at any adjournment
thereof, with all the powers which the undersigned would possess if personally
present, as designated on the reverse hereof.
The undersigned hereby revokes any proxy previously given and instructs
the said proxies to vote in accordance with the instructions with respect to (1)
approval of the proposed reverse stock split and the amendment to the
Certificate of Incorporation; and (2) the consideration and vote of such other
matters as may properly come before the Special Meeting of Stockholders or any
adjournment thereof.
This proxy, when properly executed, will be voted in the manner directed
herein by the stockholder. If no such direction is made, the said proxies will
vote FOR Proposal 1, and in their discretion with respect to such other matters
as may properly come before the Annual Meeting of Stockholders, in the interest
of the Fund.
(Continued and to be dated and signed on reverse side)
SPECIAL MEETING OF STOCKHOLDERS OF
CORNERSTONE TOTAL RETURN FUND, INC.
October XX, 2008
PLEASE DATE, SIGN AND MAIL YOUR PROXY CARD IN THE ENVELOPE PROVIDED AS SOON AS
POSSIBLE.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" PROPOSAL 1 (THE APPROVAL OF THE
PROPOSED REVERSE STOCK SPLIT AND THE AMENDMENT TO THE CERTIFICATE OF
INCORPORATION) AND "FOR" PROPOSAL 2. PLEASE SIGN, DATE AND RETURN PROMPTLY IN
THE ENCLOSED ENVELOPE. PLEASE MARK YOUR VOTE IN BLUE OR BLACK INK AS SHOWN HERE
[X]
1. To approve proposed one-for-two reverse stock split and the amendment to
the Certificate of Incorporation.
FOR AGAINST ABSTAIN
/ / / / / /
2. In their discretion, the proxies are authorized to consider and vote upon
such other matters as may properly come before the said Meeting or any
adjournment thereof.
FOR AGAINST ABSTAIN
/ / / / / /
Your proxy is important to assure a quorum at the Special Meeting of
Stockholders, whether or not you plan to attend the meeting in person. You may
revoke this proxy at anytime, and the giving of it will not affect your right to
attend the Special Meeting of Stockholders and vote in person.
PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY USING THE ENCLOSED
ENVELOPE.
SIGNATURE OF STOCKHOLDER____________________________ DATE___________________
SIGNATURE OF STOCKHOLDER____________________________ DATE___________________
NOTE: Please sign exactly as your name or names appear on this Proxy. When
shares are held jointly, each holder should sign. When signing as executor,
administrator, attorney, trustee or guardian, please give full title as such. If
the signer is a corporation, please sign full corporate name by duly authorized
officer, giving full title as such. If signer is a partnership, please sign in
partnership name by authorized person.
EXHIBIT A
CERTIFICATE OF AMENDMENT
OF THE
CERTIFICATE OF INCORPORATION
OF
CORNERSTONE TOTAL RETURN FUND, INC.
UNDER SECTION 805 OF THE BUSINESS CORPORATION LAW
BLANK ROME LLP
THE CHRYSLER BUILDING
405 LEXINGTON AVENUE
NEW YORK, NEW YORK 10174
CERTIFICATE OF AMENDMENT
OF THE
CERTIFICATE OF INCORPORATION
OF
CORNERSTONE TOTAL RETURN FUND, INC.
UNDER SECTION 805 OF THE BUSINESS CORPORATION LAW
The undersigned, being an authorized officer of CORNERSTONE TOTAL RETURN
FUND, INC. (the "Corporation"), does hereby certify:
FIRST. The name of the Corporation is Cornerstone Total Return Fund, Inc.
It was formed under the name Excelsior Income Shares, Inc.
SECOND. The Certificate of Incorporation was filed by the Department of
State of New York on March 14, 1973.
THIRD. Article 4 of the Certificate of Incorporation, which sets forth the
authorized shares of capital stock of the Corporation, is hereby amended to
effect a reclassification of the shares of Common Stock, par value $0.01 per
share (the "Common Stock"), currently outstanding (the "Old Shares") so that
every two shares of Common Stock issued and outstanding immediately prior to the
date of such amendment shall, effective as of the date of such amendment, be
reclassified and changed into one share of Common Stock (the "New Shares"). No
fractional shares will be issued as a result of the foregoing reclassification.
In lieu of issuing fractional shares, the Company will pay cash to any
shareholder who otherwise would have been entitled to receive a fractional share
as a result of the foregoing reclassification. As a result of the foregoing
reclassification, the par value of the Corporation's Common Stock will not
change.
FOURTH. The foregoing amendment of the Certificate of Incorporation was
authorized by written consent, setting forth the action taken, signed by all of
the members of the Board of Directors, followed by the vote of the holders of a
majority of the outstanding shares entitled to vote thereon at a meeting of the
shareholders.
IN WITNESS WHEREOF, the undersigned has executed this Certificate of
Amendment this __ day of _______, 2008.
CORNERSTONE TOTAL RETURN FUND, INC.
By: /s/ Ralph W. Bradshaw
--------------------------------
Ralph W. Bradshaw
President