<SEC-DOCUMENT>0001206774-13-000979.txt : 20130307
<SEC-HEADER>0001206774-13-000979.hdr.sgml : 20130307
<ACCEPTANCE-DATETIME>20130307171557
ACCESSION NUMBER:		0001206774-13-000979
CONFORMED SUBMISSION TYPE:	DEF 14A
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20130418
FILED AS OF DATE:		20130307
DATE AS OF CHANGE:		20130307
EFFECTIVENESS DATE:		20130307

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			Flaherty & Crumrine PREFERRED INCOME OPPORTUNITY FUND INC
		CENTRAL INDEX KEY:			0000882071
		IRS NUMBER:				954355600
		STATE OF INCORPORATION:			MD
		FISCAL YEAR END:			1130

	FILING VALUES:
		FORM TYPE:		DEF 14A
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	811-06495
		FILM NUMBER:		13674289

	BUSINESS ADDRESS:	
		STREET 1:		301 E COLORADO BLVD STE 720
		STREET 2:		C/O FLAHERTY & CRUMRINE INC
		CITY:			PASADENA
		STATE:			CA
		ZIP:			91101
		BUSINESS PHONE:		(626) 795-7300

	MAIL ADDRESS:	
		STREET 1:		301 COLORADO BLVD STE 720
		STREET 2:		C/O FLAHERTY & CRUMRINE INC
		CITY:			PASADENA
		STATE:			CA
		ZIP:			91101

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	PREFERRED INCOME OPPORTUNITY FUND INC
		DATE OF NAME CHANGE:	19920929
</SEC-HEADER>
<DOCUMENT>
<TYPE>DEF 14A
<SEQUENCE>1
<FILENAME>fandcpfo_def14a.htm
<DESCRIPTION>DEFINITIVE PROXY STATEMENT
<TEXT>
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<BR>
<P align=center><FONT face="Times New Roman" size=2>SCHEDULE 14A<BR>PROXY
STATEMENT<BR></FONT><FONT face="Times New Roman" size=2>PURSUANT TO SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934 </FONT></P>
<P align=left><FONT face="Times New Roman" size=2>Filed by Registrant [X]</FONT><BR><FONT face="Times New Roman" size=2>Filed by Party other than the Registrant</FONT></P>
<P align=left><FONT face="Times New Roman" size=2>Check the appropriate box:<BR>[ ]
Preliminary Proxy Statement<BR></FONT><FONT face="Times New Roman" size=2>[ ] Confidential
for Use of the Commission Only as permitted by Rule 14a-6(e)(2)<BR>[X]
Definitive Proxy Statement<BR>[ ] Definitive Additional Materials<BR>[ ]
Soliciting Material Pursuant to Rule 14a-11c or Rule 14a-12</FONT></P>
<DIV align=center>
<TABLE style="LINE-HEIGHT: 14pt; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="10%" border=0>

  <TR vAlign=bottom>
    <TD style="BORDER-BOTTOM: #000000 1pt solid; text-align: center" noWrap width="100%"><FONT face="Times New Roman" size=2>Flaherty &amp; Crumrine Preferred Income Opportunity Fund Incorporated</FONT></TD></TR>
  <TR>
    <TD style="text-align: center" width="100%"><FONT size=2 face="Times New Roman">(Name of Registrant as
      Specified in Its Charter)</FONT></TD></TR></TABLE><BR>
<TABLE style="LINE-HEIGHT: 14pt; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="10%" border=0>

  <TR vAlign=bottom>
    <TD style="BORDER-BOTTOM: #000000 1pt solid; text-align: center" width="100%"></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap style="text-align: center" width="100%"><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;(Name of Person(s) Filing Proxy
      Statement)&nbsp;&nbsp;&nbsp;</FONT></TD></TR></TABLE></DIV><BR>
<P align=left><FONT face="Times New Roman" size=2>Payment of Filing Fee (Check the
appropriate box):</FONT></P>
<P align=left><FONT face="Times New Roman" size=2>[X] No fee required</FONT><BR><FONT face="Times New Roman" size=2>[ ] Fee computed on table below per Exchange Act Rules
14a-6(i)(1) and 0-11 </FONT></P>
<TABLE cellSpacing=0 cellPadding=0 border=0>

  <TR>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>(1)</FONT></TD>
    <TD vAlign=top noWrap></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" width="100%"><FONT face="Times New Roman" size=2>Title of each class of securities to which transaction
      applies:<BR>&nbsp;</FONT></TD></TR>
  <TR>
    <TD vAlign=top noWrap></TD>
    <TD vAlign=top noWrap>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD width="100%"></TD></TR>
  <TR>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>(2)</FONT></TD>
    <TD vAlign=top noWrap></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" width="100%"><FONT face="Times New Roman" size=2>Aggregate number of securities to which transaction
      applies:<BR>&nbsp;</FONT></TD></TR>
  <TR>
    <TD colSpan=3>&nbsp;</TD></TR>
  <TR>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>(3)</FONT></TD>
    <TD vAlign=top noWrap></TD>
    <TD WIDTH="100%" STYLE="border-bottom: #000000 1pt solid; text-align: justify"><FONT face="Times New Roman" size=2>Per unit price or other underlying value of transaction computed
      pursuant to Exchange Act Rule 0-11. (Set forth the amount on which the
      filing fee is calculated and state how it was
    determined):<BR>&nbsp;</FONT></TD></TR>
  <TR>
    <TD colSpan=3>&nbsp;</TD></TR>
  <TR>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>(4)</FONT></TD>
    <TD vAlign=top noWrap></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" width="100%"><FONT face="Times New Roman" size=2>Proposed maximum aggregate value of
  transaction:<BR>&nbsp;</FONT></TD></TR>
  <TR>
    <TD colSpan=3>&nbsp;</TD></TR>
  <TR>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>(5)</FONT></TD>
    <TD vAlign=top noWrap></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" width="100%"><FONT face="Times New Roman" size=2>Total fee paid:<BR>&nbsp;</FONT></TD></TR></TABLE>
<P align=left><FONT face="Times New Roman" size=2>[ ] Fee paid previously with preliminary
materials.</FONT></P>
<P STYLE="text-align: justify"><FONT face="Times New Roman" size=2>[ ] Check box if any part of the fee is
offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for
which the offsetting fee was paid previously. Identify the previous filing by
registration statement number, or the Form or Schedule and the date of its
filing.</FONT></P>
<TABLE cellSpacing=0 cellPadding=0 border=0>

  <TR>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>(1)</FONT></TD>
    <TD vAlign=top noWrap></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" width="100%"><FONT face="Times New Roman" size=2>Amount previously paid:<BR>&nbsp;</FONT></TD></TR>
  <TR>
    <TD vAlign=top noWrap></TD>
    <TD vAlign=top noWrap>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD width="100%"></TD></TR>
  <TR>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>(2)</FONT></TD>
    <TD vAlign=top noWrap></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" width="100%"><FONT face="Times New Roman" size=2>Form, Schedule or Registration Statement
No.:<BR>&nbsp;</FONT></TD></TR>
  <TR>
    <TD colSpan=3>&nbsp;</TD></TR>
  <TR>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>(3)</FONT></TD>
    <TD vAlign=top noWrap></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" width="100%"><FONT face="Times New Roman" size=2>Filing Party:<BR>&nbsp;</FONT></TD></TR>
  <TR>
    <TD colSpan=3>&nbsp;</TD></TR>
  <TR>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>(4)</FONT></TD>
    <TD vAlign=top noWrap></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" width="100%"><FONT face="Times New Roman" size=2>Date Filed:<BR>&nbsp;</FONT></TD></TR></TABLE><BR>
<HR align=center width="100%" noShade SIZE=2>


<DIV style="PAGE-BREAK-BEFORE: always"></DIV><BR>
<P align=center><B><FONT face="Times New Roman" size=2>FLAHERTY &amp; CRUMRINE PREFERRED
INCOME FUND INCORPORATED (NYSE: PFD)<BR></FONT></B><B><FONT face="Times New Roman" size=2>FLAHERTY &amp; CRUMRINE PREFERRED INCOME OPPORTUNITY FUND INCORPORATED
(NYSE: PFO) <BR>FLAHERTY &amp; CRUMRINE PREFERRED SECURITIES INCOME FUND
INCORPORATED (NYSE: FFC) <BR>FLAHERTY &amp; CRUMRINE TOTAL RETURN FUND
INCORPORATED (NYSE: FLC)</FONT></B></P>
<P align=center><FONT face="Times New Roman" size=2>301 E. Colorado Boulevard, Suite
720<BR>Pasadena, California 91101</FONT></P>
<P align=center><B><FONT face="Times New Roman" size=2>NOTICE OF ANNUAL MEETINGS OF
SHAREHOLDERS<BR></FONT></B><FONT face="Times New Roman" size=2>To Be Held on April 18,
2013</FONT></P>
<P align=justify><FONT face="Times New Roman" size=2>To the Shareholders: </FONT></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="Times New Roman" size=2>Notice is
hereby given that the Annual Meetings of Shareholders of Flaherty &amp; Crumrine
Preferred Income Fund Incorporated, Flaherty &amp; Crumrine Preferred Income
Opportunity Fund Incorporated, Flaherty &amp; Crumrine Preferred Securities
Income Fund Incorporated and Flaherty &amp; Crumrine Total Return Fund
Incorporated (each, a &#147;Fund&#148; and collectively, the &#147;Funds&#148;), each a Maryland
corporation, will be held at the offices of Flaherty &amp; Crumrine
Incorporated, 301 E. Colorado Boulevard, Suite 720, Pasadena, California 91101
at 8:30 a.m. PT, on April 18, 2013, for the following purposes: </FONT></P>
<P align=justify><FONT face="Times New Roman" size=2><FONT size=3 face="Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT>Each Fund: </FONT></P>
<TABLE cellSpacing=0 cellPadding=0 border=0 style="text-align: justify">

  <TR>
    <TD vAlign=top noWrap></TD>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>1.</FONT></TD>
    <TD vAlign=top noWrap></TD>
    <TD vAlign=top width="100%"><FONT face="Times New Roman" size=2>To elect Directors of
      each Fund (Proposal 1).</FONT></TD></TR>
  <TR>
    <TD vAlign=top></TD>
    <TD vAlign=top colSpan=3>&nbsp;</TD></TR>
  <TR>
    <TD vAlign=top noWrap>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>2.</FONT></TD>
    <TD vAlign=top noWrap>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD vAlign=top width="100%"><FONT face="Times New Roman" size=2>To transact such other
      business as may properly come before the Annual Meetings or any
      adjournments thereof.</FONT></TD></TR></TABLE>
<P align=justify><B><FONT face="Times New Roman" size=2>Your vote is important!
</FONT></B></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp; <FONT face="Times New Roman" size=2>The Board of
Directors of each Fund has fixed the close of business on January 18, 2013 as
the record date for the determination of shareholders of each Fund entitled to
notice of and to vote at the Annual Meetings and any adjournments or
postponements thereof. </FONT></P>
<TABLE style="LINE-HEIGHT: 14pt; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=bottom>
    <TD noWrap align=left width="60%"></TD>
    <TD noWrap align=left width="40%"><FONT face="Times New Roman" size=2>By Order of the Boards of
      Directors,</FONT></TD></TR>
  <TR>
    <TD width="99%" colSpan=2>&nbsp;</TD></TR>
  <TR>
    <TD width="99%" colSpan=2>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="60%"><FONT face="Times New Roman" size=2>March 11, 2013</FONT></TD>
    <TD noWrap align=left width="40%"><FONT face="Times New Roman" size=2>CHAD C. CONWELL</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="60%"></TD>
    <TD noWrap align=left width="40%"><I><FONT face="Times New Roman" size=2>Secretary</FONT></I></TD></TR></TABLE><BR>
<TABLE cellSpacing=0 cellPadding=4 width="100%" border=0>

  <TR>
    <TD style="BORDER-RIGHT: #000000 1pt solid; BORDER-TOP: #000000 1pt solid; BORDER-LEFT: #000000 1pt solid; BORDER-BOTTOM: #000000 1pt solid; text-align: center" width="100%">
      <P align=center><B><FONT face="Times New Roman" size=2>Important Notice Regarding the
      Availability of Proxy Materials for the Shareholder Meeting to Be<BR>
Held
      on April 18, 2013.</FONT></B></P>
      <P align=justify><B><FONT face="Times New Roman" size=2>The notice of Annual Meetings
      of Shareholders, joint proxy statement, proxy cards and each Fund&#146;s annual
      report for the fiscal year ended November 30, 2012 are available to you on
      the Funds&#146; website - www.preferredincome.com. You are encouraged to review
      all of the information contained in the proxy materials before
      voting.</FONT></B></P>
      <P align=justify><B><FONT face="Times New Roman" size=2>To obtain directions to attend
      the Annual Meetings and vote in person, please call
      1-626-795-7300.</FONT></B></P>
      <P align=justify><B><FONT face="Times New Roman" size=2>SEPARATE PROXY CARDS ARE
      ENCLOSED FOR EACH FUND IN WHICH YOU OWN SHARES. SHAREHOLDERS WHO DO NOT
      EXPECT TO ATTEND THE ANNUAL MEETINGS ARE REQUESTED TO COMPLETE, SIGN AND
      DATE THE ENCLOSED PROXY CARD(S). The proxy card(s) should be returned in
      the enclosed envelope, which needs no postage if mailed in the continental
      United States. Instructions for the proper execution of proxies are set
      forth on the inside cover.</FONT></B></P></TD></TR></TABLE><BR>
<HR align=center width="100%" noShade SIZE=2>

<DIV style="PAGE-BREAK-BEFORE: always"></DIV><BR>
<P align=center><B><FONT face="Times New Roman" size=2>INSTRUCTIONS FOR SIGNING PROXY
CARDS</FONT></B></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp; <FONT face="Times New Roman" size=2>The following
general rules for signing proxy cards may be of assistance to you and may
minimize the time and expense to the Fund(s) involved in validating your vote if
you fail to sign your proxy card(s) properly. </FONT></P>
<TABLE style="TEXT-ALIGN: justify" cellSpacing=0 cellPadding=0 border=0>

  <TR>
    <TD vAlign=top noWrap></TD>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>1.</FONT></TD>
    <TD vAlign=top noWrap></TD>
    <TD vAlign=top width="100%"><FONT face="Times New Roman" size=2>Individual Accounts:
      Sign your name exactly as it appears in the registration on the proxy
      card(s).</FONT></TD></TR>
  <TR>
    <TD vAlign=top></TD>
    <TD vAlign=top colSpan=3>&nbsp;</TD></TR>
  <TR>
    <TD vAlign=top noWrap></TD>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>2.</FONT></TD>
    <TD vAlign=top noWrap></TD>
    <TD vAlign=top width="100%"><FONT face="Times New Roman" size=2>Joint Accounts: Either
      party may sign, but the name of the party signing should conform exactly
      to a name shown in the registration.</FONT></TD></TR>
  <TR>
    <TD vAlign=top></TD>
    <TD vAlign=top colSpan=3>&nbsp;</TD></TR>
  <TR>
    <TD vAlign=top noWrap>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>3.</FONT></TD>
    <TD vAlign=top noWrap>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD vAlign=top width="100%"><FONT face="Times New Roman" size=2>All Other Accounts:
      The capacity of the individual signing the proxy card should be indicated
      unless it is reflected in the form registration. For
  example:</FONT></TD></TR></TABLE><BR>
<DIV align=right>
<TABLE style="LINE-HEIGHT: 14pt; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=bottom>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
    </TD>
    <TD noWrap align=left width="49%" colSpan=3><FONT style="BORDER-BOTTOM: #000000 1pt solid" face="Times New Roman" size=2>Registration</FONT></TD>
    <TD noWrap align=left width="50%"><FONT style="BORDER-BOTTOM: #000000 1pt solid" face="Times New Roman" size=2>Valid Signature</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="99%" bgColor=#c0c0c0 colSpan=4><FONT face="Times New Roman" size=2>Corporate Accounts</FONT></TD></TR>
  <TR>
    <TD width="1%"></TD>
    <TD width="99%" colSpan=4>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>(1)</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2></FONT></TD>
    <TD noWrap align=left width="47%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>ABC Corp.</FONT></TD>
    <TD noWrap align=left width="50%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>ABC
Corp.</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%"><FONT face="Times New Roman" size=2>(2)</FONT></TD>
    <TD noWrap align=left width="1%"><FONT face="Times New Roman" size=2></FONT></TD>
    <TD noWrap align=left width="47%"><FONT face="Times New Roman" size=2>ABC Corp.</FONT></TD>
    <TD noWrap align=left width="50%"><FONT face="Times New Roman" size=2>John Doe, Treasurer</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>(3)</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="47%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>ABC Corp. c/o John
      Doe, Treasurer</FONT></TD>
    <TD noWrap align=left width="50%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>John Doe</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%"><FONT face="Times New Roman" size=2>(4)</FONT></TD>
    <TD noWrap align=left width="1%"><FONT face="Times New Roman" size=2></FONT></TD>
    <TD noWrap align=left width="47%"><FONT face="Times New Roman" size=2>ABC Corp. Profit Sharing Plan</FONT></TD>
    <TD noWrap align=left width="50%"><FONT face="Times New Roman" size=2>John Doe, Trustee</FONT></TD></TR>
  <TR>
    <TD width="1%"></TD>
    <TD width="99%" colSpan=4>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="49%" bgColor=#c0c0c0 colSpan=3><FONT face="Times New Roman" size=2>Trust Accounts</FONT></TD>
    <TD noWrap align=left width="50%" bgColor=#c0c0c0></TD></TR>
  <TR>
    <TD width="1%"></TD>
    <TD width="99%" colSpan=4>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>(1)</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2></FONT></TD>
    <TD noWrap align=left width="47%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>ABC Trust</FONT></TD>
    <TD noWrap align=left width="50%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Jane B. Doe,
      Trustee</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%"><FONT face="Times New Roman" size=2>(2)</FONT></TD>
    <TD noWrap align=left width="1%"><FONT face="Times New Roman" size=2></FONT></TD>
    <TD noWrap align=left width="47%"><FONT face="Times New Roman" size=2>Jane B. Doe, Trustee</FONT></TD>
    <TD noWrap align=left width="50%"><FONT face="Times New Roman" size=2>Jane B. Doe</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="47%"><FONT face="Times New Roman" size=2>u/t/d 12/28/78</FONT></TD>
    <TD noWrap align=left width="50%"></TD></TR>
  <TR>
    <TD width="1%"></TD>
    <TD width="99%" colSpan=4>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="49%" bgColor=#c0c0c0 colSpan=3><FONT face="Times New Roman" size=2>Custodian or Estate Accounts</FONT></TD>
    <TD noWrap align=left width="50%" bgColor=#c0c0c0></TD></TR>
  <TR>
    <TD width="1%"></TD>
    <TD width="99%" colSpan=4>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>(1)</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2></FONT></TD>
    <TD noWrap align=left width="47%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>John B. Smith,
      Cust.,</FONT></TD>
    <TD noWrap align=left width="50%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>John B.
    Smith</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="47%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>f/b/o John B. Smith,
      Jr. UGMA</FONT></TD>
    <TD noWrap align=left width="50%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%"><FONT face="Times New Roman" size=2>(2)</FONT></TD>
    <TD noWrap align=left width="1%"><FONT face="Times New Roman" size=2></FONT></TD>
    <TD noWrap align=left width="47%"><FONT face="Times New Roman" size=2>John B. Smith, Executor,</FONT></TD>
    <TD noWrap align=left width="50%"><FONT face="Times New Roman" size=2>John B. Smith, Executor</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD noWrap align=left width="47%"><FONT face="Times New Roman" size=2>Estate of Jane Smith</FONT></TD>
    <TD noWrap align=left width="50%"></TD></TR></TABLE></DIV><BR>
<HR align=center width="100%" noShade SIZE=2>

<DIV style="PAGE-BREAK-BEFORE: always"></DIV><BR>
<P align=center><B><FONT face="Times New Roman" size=2>FLAHERTY &amp; CRUMRINE PREFERRED
INCOME FUND INCORPORATED (NYSE: PFD)<BR></FONT></B><B><FONT face="Times New Roman" size=2>FLAHERTY &amp; CRUMRINE PREFERRED INCOME OPPORTUNITY FUND INCORPORATED
(NYSE: PFO) <BR>FLAHERTY &amp; CRUMRINE PREFERRED SECURITIES INCOME FUND
INCORPORATED (NYSE:&nbsp;FFC) <BR>FLAHERTY &amp; CRUMRINE TOTAL RETURN FUND
INCORPORATED (NYSE: FLC) </FONT></B></P>
<P align=center><FONT face="Times New Roman" size=2>301 E. Colorado Boulevard, Suite 720
<BR>Pasadena, California 91101</FONT></P>
<P align=center><B><FONT face="Times New Roman" size=2>ANNUAL MEETINGS OF
SHAREHOLDERS<BR></FONT></B><FONT face="Times New Roman" size=2>April 18, 2013</FONT></P>
<P align=center><B><FONT face="Times New Roman" size=2>JOINT PROXY STATEMENT</FONT></B></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp; <FONT face="Times New Roman" size=2>This document
is a joint proxy statement (&#147;Joint Proxy Statement&#148;) for Flaherty &amp; Crumrine
Preferred Income Fund Incorporated (&#147;Preferred Income Fund&#148; or &#147;PFD&#148;), Flaherty
&amp; Crumrine Preferred Income Opportunity Fund Incorporated (&#147;Preferred Income
Opportunity Fund&#148; or &#147;PFO&#148;), Flaherty &amp; Crumrine Preferred Securities Income
Fund Incorporated (&#147;Preferred Securities Income Fund&#148; or &#147;FFC&#148;) and Flaherty
&amp; Crumrine Total Return Fund Incorporated (&#147;Total Return Fund&#148; or &#147;FLC&#148;)
(each, a &#147;Fund&#148; and collectively, the &#147;Funds&#148;). This Joint Proxy Statement is
furnished in connection with the solicitation of proxies by each Fund&#146;s Board of
Directors (each, a &#147;Board&#148; and collectively, the &#147;Boards&#148;) for use at the Annual
Meeting of Shareholders of each Fund to be held on April 18, 2013, at 8:30 a.m.
PT, at the offices of Flaherty &amp; Crumrine Incorporated, 301 E. Colorado
Boulevard, Suite 720, Pasadena, California 91101 and at any adjournments or
postponements thereof (each, a &#147;Meeting&#148; and collectively, the &#147;Meetings&#148;).
</FONT></P>
<P align=justify><FONT face="Times New Roman" size=2><FONT size=3 face="Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>A Notice of Annual Meetings of Shareholders and proxy card for each Fund
in which you own shares accompany this Joint Proxy Statement. Proxy
solicitations will be made, beginning on or about March 11, 2013, primarily by
mail, but proxy solicitations may also be made by telephone, telefax or personal
interviews conducted by officers of each Fund, Flaherty </FONT><FONT face="Times New Roman" size=2>&amp; Crumrine Incorporated (&#147;Flaherty &amp; Crumrine&#148;), the investment
adviser of each Fund, and BNY Mellon Investment Servicing (US) Inc. (&#147;BNY
Mellon&#148;), the transfer agent and administrator of each Fund. With respect to FFC
and FLC, proxy solicitations may also be made by Destra Capital Investments LLC,
the servicing agent of FFC and FLC. Costs of proxy solicitation and expenses
incurred in connection with the preparation of this Joint Proxy Statement and
its enclosures will be shared proportionally by the Funds. Each Fund also will
reimburse brokerage firms and others for their expenses in forwarding
solicitation material to the beneficial owners of its shares. This Joint Proxy
Statement and form of proxy are first being sent to shareholders on or about
March 11, 2013. </FONT></P>
<P align=justify><FONT face="Times New Roman" size=2><FONT size=3 face="Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;
</FONT><STRONG>THE ANNUAL REPORT OF EACH FUND, INCLUDING AUDITED FINANCIAL
STATEMENTS FOR THE FISCAL YEAR ENDED NOVEMBER 30, 2012, IS AVAILABLE UPON
REQUEST, WITHOUT CHARGE, BY WRITING TO BNY MELLON INVESTMENT SERVICING (US)
INC., P.O. BOX 358035, PITTSBURGH, PENNSYLVANIA 15252-8035, OR CALLING
1-866-351-7446. EACH FUND&#146;S ANNUAL REPORT IS ALSO AVAILABLE ON THE FUNDS&#146;
WEBSITE - WWW.PREFERREDINCOME.COM - THE SECURITIES AND EXCHANGE COMMISSION&#146;S
(&#147;SEC&#148;) WEBSITE (WWW.SEC.GOV) OR, FOR FFC AND FLC ONLY, BY CALLING DESTRA
CAPITAL INVESTMENTS LLC AT 1-866-233-4001. </STRONG></FONT></P>

<TABLE cellSpacing=0 cellPadding=4 width="100%" border=0>

  <TR>
    <TD style="BORDER-RIGHT: #000000 1pt solid; BORDER-TOP: #000000 1pt solid; BORDER-LEFT: #000000 1pt solid; BORDER-BOTTOM: #000000 1pt solid; text-align: center" width="100%">
      <P align=center><B><FONT face="Times New Roman" size=2>Important Notice Regarding the
      Availability of Proxy Materials for the Shareholder Meeting to Be <BR>Held
      on April 18, 2013.</FONT></B></P>
      <P align=justify><B><FONT face="Times New Roman" size=2>The notice of Annual Meetings
      of Shareholders, joint proxy statement, proxy cards and each Fund&#146;s annual
      report for the fiscal year ended November 30, 2012 are available to you on
      the Funds&#146; website - www.preferredincome.com. You are encouraged to review
      all of the information contained in the proxy materials before voting.
      </FONT></B></P>
      <P align=justify><B><FONT face="Times New Roman" size=2>To obtain directions to attend
      the Annual Meetings and vote in person, please call
      1-626-795-7300.</FONT></B></P>
      <P align=justify><B><FONT face="Times New Roman" size=2>SEPARATE PROXY CARDS ARE
      ENCLOSED FOR EACH FUND IN WHICH YOU OWN SHARES. SHAREHOLDERS WHO DO NOT
      EXPECT TO ATTEND THE ANNUAL MEETINGS ARE REQUESTED TO COMPLETE, SIGN AND
      DATE THE ENCLOSED PROXY CARD(S). The proxy card(s) should be returned in
      the enclosed envelope, which needs no postage if mailed in the continental
      United States. Instructions for the proper execution of proxies are set
      forth on the inside cover.
</FONT></B></P></TD></TR></TABLE><BR>
<P align=center><FONT face="Times New Roman" size=2>1</FONT></P>
<HR align=center width="100%" noShade SIZE=2>

<DIV style="PAGE-BREAK-BEFORE: always"></DIV><BR>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp; <FONT face="Times New Roman" size=2>If the
enclosed proxy card is properly executed and returned in time to be voted at the
relevant Meeting, the Shares (as defined below) represented thereby will be
voted in accordance with the instructions marked thereon. Unless instructions to
the contrary are marked thereon, a proxy will be voted &#147;FOR&#148; the election of the
nominees for Director. Any shareholder who has given a proxy has the right to
revoke it at any time prior to its exercise either by attending the relevant
Meeting and voting his or her Shares in person or by submitting a letter of
revocation or a later-dated proxy to the appropriate Fund delivered at the above
address prior to the date of the Meeting. </FONT></P>
<P align=justify><FONT face="Times New Roman" size=2><FONT size=3 face="Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>Under the Bylaws of each Fund, the presence in person or by proxy of the
holders of a majority of the outstanding shares of the Fund entitled to vote
shall be necessary and sufficient to constitute a quorum for the transaction of
business (a &#147;Quorum&#148;) at that Fund&#146;s Meeting. In the event that a Quorum is not
present at a Meeting, or in the event that a Quorum is present but sufficient
votes to approve any of the proposals are not received, the persons named as
proxies may propose one or more adjournments of the Meeting to permit further
solicitation of proxies. Any such adjournment will require the affirmative vote
of a majority of those shares represented at the Meeting in person or by proxy.
If a Quorum is present, the persons named as proxies will vote those proxies
which they are entitled to vote &#147;FOR&#148; a proposal in favor of such an adjournment
with respect to that proposal and will vote those proxies required to be voted
&#147;AGAINST&#148; a proposal against any such adjournment with respect to that proposal.
A shareholder vote may be taken on a proposal in the Joint Proxy Statement prior
to any such adjournment if sufficient votes have been received for approval of
that proposal. Once a Quorum has been established at the Meeting, shareholders
may continue to transact business, notwithstanding the withdrawal of
shareholders and the loss of a Quorum.</FONT></P>
<P align=justify><FONT face="Times New Roman" size=2><FONT size=3 face="Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>Each Fund has one class of capital stock outstanding: common stock, par
value $0.01 per share (the &#147;Common Stock&#148; or the &#147;Shares&#148;). Each Share is
entitled to one vote at the Meeting with respect to matters to be voted on, with
pro rata voting rights for any fractional Shares. On the record date, January
18, 2013, the following number of Shares of each Fund were issued and
outstanding: </FONT></P>
<TABLE style="LINE-HEIGHT: 14pt; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="58%" colSpan=2></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="6%" colSpan=2><FONT face="Times New Roman" size=2>Common Stock</FONT></TD>
    <TD noWrap align=left width="34%"></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="2%"><FONT face="Times New Roman" size=2>Name of Fund</FONT></TD>
    <TD noWrap align=left width="56%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="6%" colSpan=2><FONT face="Times New Roman" size=2>Outstanding</FONT></TD>
    <TD noWrap align=left width="34%"></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="58%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>Preferred Income Fund (PFD)</FONT></TD>
    <TD noWrap align=left width="4%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>10,944,857</FONT></TD>
    <TD noWrap align=left width="2%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="34%" bgColor=#c0c0c0></TD></TR>
  <TR>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="58%" colSpan=2></TD>
    <TD noWrap align=right width="4%"></TD>
    <TD noWrap align=left width="2%"></TD>
    <TD noWrap align=left width="34%">&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%">&nbsp;</TD>
    <TD noWrap align=left width="58%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>Preferred Income Opportunity Fund (PFO)</FONT></TD>
    <TD noWrap align=right width="4%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>12,238,314</FONT></TD>
    <TD noWrap align=left width="2%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="34%" bgColor=#c0c0c0>&nbsp;</TD></TR>
  <TR>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="58%" colSpan=2></TD>
    <TD noWrap align=right width="4%">&nbsp;</TD>
    <TD noWrap align=left width="2%">&nbsp;</TD>
    <TD noWrap align=left width="34%"></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="58%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>Preferred Securities Income Fund (FFC)</FONT></TD>
    <TD noWrap align=right width="4%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>43,346,214</FONT></TD>
    <TD noWrap align=left width="2%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="34%" bgColor=#c0c0c0></TD></TR>
  <TR>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="58%" colSpan=2></TD>
    <TD noWrap align=right width="4%"></TD>
    <TD noWrap align=left width="2%">&nbsp;</TD>
    <TD noWrap align=left width="34%"></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="58%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>Total Return Fund (FLC)</FONT></TD>
    <TD noWrap align=right width="4%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>9,884,939</FONT></TD>
    <TD noWrap align=left width="2%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="34%" bgColor=#c0c0c0></TD></TR></TABLE><BR>
<P align=justify><FONT face="Times New Roman" size=2><FONT size=3 face="Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>To the knowledge of each Fund and its Board, the following
shareholder(s), or &#147;group&#148; as that term is defined in Section 13(d) of the
Securities Exchange Act of 1934, as amended (the &#147;1934 Act&#148;), is the beneficial
owner or owner of record of more than 5% of the relevant Fund&#146;s outstanding
Shares as of January 18, 2013*: </FONT></P>
<TABLE style="LINE-HEIGHT: 14pt; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=bottom>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD noWrap align=left width="82%" colSpan=2><FONT face="Times New Roman" size=2>Name and Address
      of</FONT></TD>
    <TD noWrap align=left width="4%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="5%"><FONT face="Times New Roman" size=2>Amount and Nature</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="5%"></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="12%"><FONT face="Times New Roman" size=2>Beneficial/Record Owner</FONT></TD>
    <TD noWrap align=left width="70%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="4%"><FONT face="Times New Roman" size=2>Title of Class</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="5%"><FONT face="Times New Roman" size=2>of Ownership</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=right width="5%"><FONT face="Times New Roman" size=2>Percent of Class</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%">&nbsp;</TD>
    <TD noWrap align=left width="82%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>Cede &amp; Co.**</FONT></TD>
    <TD noWrap align=left width="4%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Common
Stock</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFD &#150; 10,531,591
      (record)</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>96.2%</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD NOWRAP COLSPAN="2" STYLE="text-align: left; width: 82%; background-color: Silver"><FONT face="Times New Roman" size=2>Depository Trust
      Company</FONT></TD>
    <TD NOWRAP STYLE="text-align: left; width: 4%; background-color: Silver"></TD>
    <TD NOWRAP STYLE="text-align: left; width: 1%; background-color: Silver">&nbsp;</TD>
    <TD NOWRAP STYLE="text-align: left; width: 5%; background-color: Silver"><FONT face="Times New Roman" size=2>PFO &#150; 11,772,730 (record)</FONT></TD>
    <TD NOWRAP STYLE="text-align: left; width: 1%; background-color: Silver"></TD>
    <TD NOWRAP STYLE="text-align: left; width: 5%; background-color: Silver"><FONT face="Times New Roman" size=2>96.2%</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="82%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>55 Water Street, 25<SUP>th </SUP>Floor</FONT></TD>
    <TD noWrap align=left width="4%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FFC &#150; 43,267,819
      (record)</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>99.8%</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD NOWRAP COLSPAN="2" STYLE="text-align: left; width: 82%; background-color: Silver"><FONT face="Times New Roman" size=2>New York, NY
      10041</FONT></TD>
    <TD NOWRAP STYLE="text-align: left; width: 4%; background-color: Silver"></TD>
    <TD NOWRAP STYLE="text-align: left; width: 1%; background-color: Silver"></TD>
    <TD NOWRAP STYLE="text-align: left; width: 5%; background-color: Silver"><FONT face="Times New Roman" size=2>FLC &#150; 9,872,485 (record)</FONT></TD>
    <TD NOWRAP STYLE="text-align: left; width: 1%; background-color: Silver"></TD>
    <TD NOWRAP STYLE="text-align: left; width: 5%; background-color: Silver"><FONT face="Times New Roman" size=2>99.8%</FONT></TD></TR></TABLE><BR>
<P align=center><FONT face="Times New Roman" size=2>2</FONT></P>
<HR align=center width="100%" noShade SIZE=2>

<DIV style="PAGE-BREAK-BEFORE: always"></DIV><BR>
<TABLE style="LINE-HEIGHT: 14pt; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR>
    <TD noWrap align=left width="1%" ></TD>
    <TD noWrap align=left width="81%"  bgColor=#ffffff colSpan=2><FONT size=2><FONT face="Times New Roman">Name and Address of</FONT></FONT></TD>
    <TD noWrap align=left width="5%"  bgColor=#ffffff></TD>
    <TD noWrap align=left width="1%"  bgColor=#ffffff></TD>
    <TD noWrap align=left width="5%"  bgColor=#ffffff><FONT size=2><FONT face="Times New Roman">Amount and Nature</FONT></FONT></TD>
    <TD noWrap align=left width="1%"  bgColor=#ffffff></TD>
    <TD noWrap align=left width="5%"  bgColor=#ffffff></TD></TR>
  <TR>
    <TD noWrap align=left width="1%" ></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="12%"  bgColor=#ffffff><FONT size=2><FONT face="Times New Roman">Beneficial/Record Owner</FONT></FONT></TD>
    <TD noWrap align=left width="69%"  bgColor=#ffffff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="5%"  bgColor=#ffffff><FONT size=2><FONT face="Times New Roman">Title of
      Class</FONT></FONT></TD>
    <TD noWrap align=left width="1%"  bgColor=#ffffff></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="5%"  bgColor=#ffffff><FONT size=2><FONT face="Times New Roman">of
      Ownership</FONT></FONT></TD>
    <TD noWrap align=left width="1%"  bgColor=#ffffff></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="5%"  bgColor=#ffffff><FONT size=2><FONT face="Times New Roman">Percent of
      Class</FONT></FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD noWrap align=left width="81%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>Guggenheim Capital LLC, Guggenheim</FONT></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Common Stock</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FLC &#150;
      608,266<SUP>1</SUP> (beneficial)</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>6.17%</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="81%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>Partners, LLC, GP Holdco, GPFT Holdco,</FONT></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="81%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>LLC,
      Guggenheim Funds Services, LLC</FONT></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="81%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>and
      Guggenheim Funds Distributors, LLC</FONT></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="81%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>(&#147;GFD&#148;), Claymore Securities Defined</FONT></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="81%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>Portfolios, Series 494, 592, 644, 661; and</FONT></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="81%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>Guggenheim Defined Portfolios, Series</FONT></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="81%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>754,
      761, 765, 766, 771, 781, 788, 789,</FONT></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="81%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>793,
      812, 813, 833, 840, 846, 853, 874,</FONT></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="81%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>876,
      887, 894, 895, 909, 910, 911, 912,</FONT></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%">&nbsp;</TD>
    <TD noWrap align=left width="81%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>921,
      963, 965, 979, 980 &amp; 982<SUP>1</SUP></FONT></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="81%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>2455
      Corporate West Drive</FONT></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="81%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>Lisle, IL 60532</FONT></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0></TD></TR></TABLE>____________________<STRONG><BR>&nbsp;</STRONG><BR>
<TABLE style="TEXT-ALIGN: justify" cellSpacing=0 cellPadding=0 border=0>

  <TR>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>*</FONT></TD>
    <TD vAlign=top noWrap></TD>
    <TD vAlign=top width="100%"><FONT face="Times New Roman" size=2>As of January 18,
      2013, the Directors and officers, as a group, owned less than 1% of the
      Shares of each Fund.</FONT></TD></TR>
  <TR>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>**</FONT></TD>
    <TD vAlign=top noWrap></TD>
    <TD vAlign=top width="100%"><FONT face="Times New Roman" size=2>A nominee partnership
      of The Depository Trust Company.</FONT></TD></TR>
  <TR>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>1</FONT></TD>
    <TD vAlign=top noWrap>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD vAlign=top width="100%"><FONT face="Times New Roman" size=2>Information obtained
      from a Schedule 13G/A filed by Guggenheim Capital LLC, Guggenheim
      Partners, LLC, GP Holdco, GPFT Holdco, LLC, Guggenheim Funds Services, LLC
      and GFD. GFD filed as sponsor for Claymore Securities Defined Portfolios
      and Guggenheim Defined Portfolios (together the &#147;Filing Entities&#148;), with
      the SEC reporting share ownership as of December 31, 2012. Based on that
      filing, the Filing Entities have the shared power to vote or direct the
      vote or dispose or direct the disposition of 608,266
  Shares.</FONT></TD></TR></TABLE>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp; <FONT face="Times New Roman" size=2>This Joint
Proxy Statement is being used in order to reduce the preparation, printing,
handling and postage expenses that would result from the use of a separate proxy
statement for each Fund. Shareholders of each Fund will vote as a single class.
Shareholders of each Fund will vote separately for each of PFD, PFO, FFC and FLC
on each proposal on which shareholders of that Fund are entitled to vote.
Separate proxy cards are enclosed for each Fund in which a shareholder is a
record owner of Shares. Thus, if a proposal is approved by shareholders of one
or more Funds and not approved by shareholders of one or more other Funds, the
proposal will be implemented for the Fund or Funds that approved the proposal
and will not be implemented for any Fund that did not approve the proposal. It
is therefore essential that shareholders complete, date and sign each enclosed
proxy card. Shareholders of each Fund are entitled to vote on the proposal
pertaining to that Fund. </FONT></P>
<P align=center><FONT face="Times New Roman" size=2>3</FONT></P>
<HR align=center width="100%" noShade SIZE=2>

<DIV style="PAGE-BREAK-BEFORE: always"></DIV><BR>
<P align=center><B><FONT face="Times New Roman" size=2>PROPOSAL 1: ELECTION OF
DIRECTORS</FONT></B></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp; <FONT face="Times New Roman" size=2>At the
Meetings, shareholders are being asked to consider the election of Directors of
each Fund. The Board of each Fund is divided into three classes, each class
having a term of three years. Each year the term of office of one class expires
and the successor or successors elected to such class serve for a three-year
term and until their successors are duly elected and qualified. </FONT></P>
<P align=justify><B><FONT face="Times New Roman" size=2>Nominees for the Boards of Directors
</FONT></B></P>
<P align=justify><FONT face="Times New Roman" size=2><FONT size=3 face="Times New Roman">&nbsp;&nbsp;&nbsp;&nbsp;
</FONT>Each nominee named below has consented to serve as a Director if elected
at the relevant Meeting. If a designated nominee declines or otherwise becomes
unavailable for election, however, the proxy confers discretionary power on the
persons named therein to vote in favor of a substitute nominee or nominees. Each
nominee has been nominated for a three-year term to expire at each Fund&#146;s 2016
Annual Meeting of Shareholders and until his or her successor is duly elected
and qualified. Shareholders of each Fund&#146;s Common Stock are entitled to elect
the nominees for election to the Board of the relevant Fund.</FONT></P>
<DIV align=center>
<TABLE style="PADDING-RIGHT: 4pt; PADDING-LEFT: 4pt; LINE-HEIGHT: 14pt; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="94%" border=0>

  <TR vAlign=bottom>
    <TD style="BORDER-TOP: #000000 1pt solid; BORDER-LEFT: #000000 1pt solid; BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="49%"><B><FONT face="Times New Roman" size=2>Fund</FONT></B></TD>
    <TD style="BORDER-RIGHT: #000000 1pt solid; BORDER-TOP: #000000 1pt solid; BORDER-LEFT: #000000 1pt solid; BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="50%"><B><FONT face="Times New Roman" size=2>Nominees For
    Election</FONT></B></TD></TR>
  <TR vAlign=bottom>
    <TD style="BORDER-LEFT: #000000 1pt solid; BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="49%"><FONT face="Times New Roman" size=2>PFD</FONT></TD>
    <TD style="BORDER-RIGHT: #000000 1pt solid; BORDER-LEFT: #000000 1pt solid; BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="50%"><FONT face="Times New Roman" size=2>Morgan Gust</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD style="BORDER-LEFT: #000000 1pt solid" noWrap align=left width="49%"><FONT face="Times New Roman" size=2>PFO</FONT></TD>
    <TD style="BORDER-RIGHT: #000000 1pt solid; BORDER-LEFT: #000000 1pt solid" noWrap align=left width="50%"><FONT face="Times New Roman" size=2>Donald F. Crumrine</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD style="BORDER-LEFT: #000000 1pt solid; BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="49%"></TD>
    <TD style="BORDER-RIGHT: #000000 1pt solid; BORDER-LEFT: #000000 1pt solid; BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="50%"><FONT face="Times New Roman" size=2>Robert F. Wulf</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD style="BORDER-LEFT: #000000 1pt solid" noWrap align=left width="49%"><FONT face="Times New Roman" size=2>FFC</FONT></TD>
    <TD style="BORDER-RIGHT: #000000 1pt solid; BORDER-LEFT: #000000 1pt solid" noWrap align=left width="50%"><FONT face="Times New Roman" size=2>Donald F. Crumrine</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD style="BORDER-LEFT: #000000 1pt solid; BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="49%"></TD>
    <TD style="BORDER-RIGHT: #000000 1pt solid; BORDER-LEFT: #000000 1pt solid; BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="50%"><FONT face="Times New Roman" size=2>Robert F. Wulf</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD style="BORDER-LEFT: #000000 1pt solid" noWrap align=left width="49%"><FONT face="Times New Roman" size=2>FLC</FONT></TD>
    <TD style="BORDER-RIGHT: #000000 1pt solid; BORDER-LEFT: #000000 1pt solid" noWrap align=left width="50%"><FONT face="Times New Roman" size=2>Donald F. Crumrine</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD style="BORDER-LEFT: #000000 1pt solid; BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="49%"></TD>
    <TD style="BORDER-RIGHT: #000000 1pt solid; BORDER-LEFT: #000000 1pt solid; BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="50%"><FONT face="Times New Roman" size=2>Robert F.
Wulf</FONT></TD></TR></TABLE></DIV><BR>
<P align=justify><FONT face="Times New Roman" size=2><U>Information About Each Director&#146;s or
Nominee for Election as Director&#146;s Experience, Qualifications, Attributes or
Skills</U></FONT></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp; <FONT face="Times New Roman" size=2>Directors or
Nominees for Election as Directors of the Funds, together with information as to
their positions with the Funds, principal occupations and other board
memberships for the past five years, are shown below.</FONT></P>
<TABLE style="LINE-HEIGHT: 14pt; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=bottom>
    <TD noWrap align=left width="79%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Number of</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap align=left width="3%"></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="79%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Funds in</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Other Public</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="79%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Current</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Fund</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap align=left width="3%"><FONT face="Times New Roman" size=2>Company Board</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="79%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Position(s)</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Term of Office and</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap align=left width="3%"><FONT face="Times New Roman" size=2>Principal Occupation</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Complex</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Memberships</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="79%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Held with</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Length of Time</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap align=right width="3%"><FONT face="Times New Roman" size=2>During Past Five</FONT></TD>
    <TD noWrap align=right width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Overseen by</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap align=left width="3%"><FONT face="Times New Roman" size=2>During Past Five</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD style="BORDER-BOTTOM: #000000 1pt solid; text-align: center" noWrap width="79%"><FONT face="Times New Roman" size=2>Name, Address and
      Age</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid; text-align: center" noWrap width="3%"><FONT face="Times New Roman" size=2>Funds</FONT></TD>
    <TD noWrap style="text-align: center" width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid; text-align: center" noWrap width="3%"><FONT face="Times New Roman" size=2>Served*</FONT></TD>
    <TD noWrap style="text-align: center" width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid; text-align: center" noWrap width="3%"><FONT face="Times New Roman" size=2>Years</FONT></TD>
    <TD noWrap style="text-align: center" width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid; text-align: center" noWrap width="3%"><FONT face="Times New Roman" size=2>Director**</FONT></TD>
    <TD noWrap style="text-align: center" width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid; text-align: center" noWrap width="3%"><FONT face="Times New Roman" size=2>Years</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="79%" bgColor=#c0c0c0><B><FONT style="BORDER-BOTTOM: #000000 1pt solid" face="Times New Roman" size=2>Non-Interested</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="79%" bgColor=#c0c0c0><B><FONT style="BORDER-BOTTOM: #000000 1pt solid" face="Times New Roman" size=2>Directors/Nominees:</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR>
    <TD width="99%" colSpan=11>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="79%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>David Gale</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Director</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>Class I Director</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>President of Delta</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap style="text-align: center" width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>4</FONT></TD>
    <TD noWrap style="text-align: center" width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Metromedia</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="79%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Delta Dividend Group, Inc.</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFD &#151; since 1997</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Dividend Group, Inc.</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>International</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="79%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>220 Montgomery Street</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFO &#151; since 1997</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>(investments)</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Group, Inc.</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="79%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Suite 426</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FFC &#151; since inception</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>and Emmis</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="79%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>San Francisco, CA 94104</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FLC &#151; since inception</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Communications</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="79%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Age: 64</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR>
    <TD width="99%" colSpan=11>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="79%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>Morgan Gust</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Director and</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>Class II Director</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Owner and</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap style="text-align: center" width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>4</FONT></TD>
    <TD noWrap style="text-align: center" width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>CoBiz Financial,</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="79%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>301 E. Colorado Boulevard</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Nominating</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FFC &#151; since inception</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>operator of various</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Inc. (financial</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="79%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Suite 720</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>and</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FLC &#151; since inception</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>entities engaged in</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>services)</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="79%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Pasadena, CA 91101</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Governance</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>agriculture and real</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="79%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Age: 65</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Committee</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>Class III
Director</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>estate</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="79%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Chairman</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFD &#151; since inception</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="79%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFO &#151; since inception</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR></TABLE><BR>
<P align=center><FONT face="Times New Roman" size=2>4</FONT></P>
<HR align=center width="100%" noShade SIZE=2>

<DIV style="PAGE-BREAK-BEFORE: always"></DIV><BR>
<TABLE style="LINE-HEIGHT: 14pt; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=bottom>
    <TD noWrap align=left width="80%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Number of</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap align=left width="3%"></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Funds in</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Other Public</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%"></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Current</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%">&nbsp;</TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Fund</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Company Board</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%"></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Position(s)</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Term of Office and</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Principal Occupation</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Complex</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Memberships</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%"></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Held with</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Length of Time</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>During Past Five</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>Overseen by</FONT></TD>
    <TD noWrap style="text-align: center" width="1%"></TD>
    <TD noWrap style="text-align: center" width="3%"><FONT face="Times New Roman" size=2>During Past Five</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD style="BORDER-BOTTOM: #000000 1pt solid; text-align: center" noWrap width="80%"><FONT face="Times New Roman" size=2>Name, Address and Age</FONT></TD>
    <TD noWrap style="text-align: center" width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid; text-align: center" noWrap width="3%"><FONT face="Times New Roman" size=2>Funds</FONT></TD>
    <TD noWrap style="text-align: center" width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid; text-align: center" noWrap width="3%"><FONT face="Times New Roman" size=2>Served*</FONT></TD>
    <TD noWrap style="text-align: center" width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid; text-align: center" noWrap width="3%"><FONT face="Times New Roman" size=2>Years</FONT></TD>
    <TD noWrap style="text-align: center" width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid; text-align: center" noWrap width="3%"><FONT face="Times New Roman" size=2>Director**</FONT></TD>
    <TD noWrap style="text-align: center" width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid; text-align: center" noWrap width="3%"><FONT face="Times New Roman" size=2>Years</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>Karen H. Hogan</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Director</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>Class I
      Director</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Board
    Member,</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap style="text-align: center" width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>4</FONT></TD>
    <TD noWrap style="text-align: center" width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>None</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>301 E. Colorado
      Boulevard</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFD &#151; since
      2005</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>IKAR, a
      non-profit</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Suite 720</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>organization;</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Pasadena, CA
      91101</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>Class III
      Director</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Active
    Member,</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Age: 51</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFO &#151; since
      2005</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Committee
      Member</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>and Volunteer
      to</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>Class II
      Director</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>several
      non-profit</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FFC &#151; since
      2005</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>organizations.</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FLC &#151; since
      2005</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR>
    <TD width="100%" colSpan=11>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>Robert F. Wulf</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Director</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>Class II
      Director</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Financial
      Consultant;</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap style="text-align: center" width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>4</FONT></TD>
    <TD noWrap style="text-align: center" width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>None</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>1000 S.W. Vista
      Avenue,</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>and Audit</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFD &#151; since
      inception</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Former
    Trustee,</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Apt. 314</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Committee</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFO &#151; since
      inception</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>University of
      Oregon</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Portland, OR
      97205</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Chairman</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Foundation;
      Trustee,</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Age:75</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>Class III
      Director</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>San
    Francisco</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FFC &#151; since
      inception</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Theological</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FLC &#151; since
      inception</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Seminary</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR>
    <TD width="100%" colSpan=11>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2 style="BORDER-BOTTOM: #000000 1pt solid">Interested</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2 style="BORDER-BOTTOM: #000000 1pt solid">Director/Nominee:</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR>
    <TD width="100%" colSpan=11>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2><STRONG>Donald F. Crumrine </STRONG><SUP>(1)</SUP></FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Director,</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>Class II
      Director</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Chairman of
    the</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap style="text-align: center" width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>4</FONT></TD>
    <TD noWrap style="text-align: center" width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>None</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>301 E. Colorado
      Boulevard</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Chairman of</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFD &#151; since
      inception</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Board and Director
      of</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Suite 720</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>the Board</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFO &#151; since
      inception</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Flaherty &amp;
      Crumrine</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Pasadena, CA
      91101</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>and Chief</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Age: 65</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Executive</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>Class III
      Director</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Officer</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FFC &#151; since
      inception</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="80%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FLC &#151; since
      inception</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD></TR></TABLE>____________________<BR>&nbsp;<BR>
<TABLE style="TEXT-ALIGN: justify" cellSpacing=0 cellPadding=0 border=0>

  <TR>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>*</FONT></TD>
    <TD vAlign=top noWrap>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD width="100%"><FONT face="Times New Roman" size=2>The Class I Directors of PFD, the
      Class I Director of FFC and FLC and the Class III Directors of PFO will
      serve until each Fund&#146;s Annual Meeting of Shareholders in 2014 and until
      their successors are duly elected and qualified. The Class I Director of
      PFO and the Class II Directors of PFD, FFC and FLC will serve until each
      Fund&#146;s Annual Meeting of Shareholders in 2015 and until their successors
      are duly elected and qualified. The Class II Nominees of PFO and the Class
      III Nominees of PFD, FFC and FLC, if elected, will serve until each Fund&#146;s
      2016 Annual Meeting of Shareholders and until their successors are duly
      elected and qualified.</FONT></TD></TR>
  <TR>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>**</FONT></TD>
    <TD vAlign=top noWrap></TD>
    <TD width="100%"><FONT face="Times New Roman" size=2>The Flaherty &amp; Crumrine fund
      complex consists solely of the Funds.</FONT></TD></TR>
  <TR>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=1><SUP>(1)</SUP></FONT></TD>
    <TD vAlign=top noWrap></TD>
    <TD width="100%"><FONT face="Times New Roman" size=2>&#147;Interested person&#148; (as defined
      in the Investment Company Act of 1940, as amended (the &#147;1940 Act&#148;)) of the
      Funds. Mr. Crumrine is considered an &#147;interested person&#148; because of his
      affiliation with Flaherty &amp; Crumrine.</FONT></TD></TR></TABLE>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp; <FONT face="Times New Roman" size=2>Each Director
has been a Director of the Funds for at least five years. Additional information
about each Director follows (supplementing the information provided in the table
above) that describes some of the specific experiences, qualifications,
attributes or skills that each Director possesses which the Boards believe have
prepared them to be effective Directors. The Boards believe that Directors need
to have the ability to critically review, evaluate, question and discuss
information provided to them, and to interact effectively with Fund management,
service providers and counsel, in order to exercise effective business judgment
in the performance of their duties; the Boards believe that their members
satisfy this standard. Experience relevant to having this ability may be
achieved through a Director&#146;s educational background; business, professional
training or practice (</FONT><I><FONT face="Times New Roman" size=2>e.g.</FONT></I><FONT face="Times New Roman" size=2>, accounting or law); public service or academic positions;
experience from service as a board member (including the Boards of the Funds) or
as an executive of investment funds, public companies or significant </FONT></P>
<P align=center><FONT face="Times New Roman" size=2>5</FONT></P>
<HR align=center width="100%" noShade SIZE=2>

<DIV style="PAGE-BREAK-BEFORE: always"></DIV><BR>
<P align=justify><FONT face="Times New Roman" size=2>private or not-for-profit entities or
other organizations; and/or other life experiences. The charters for the Boards&#146;
Nominating and Governance Committees contain certain other factors considered by
the Committees in identifying and evaluating potential Director nominees. To
assist them in evaluating matters under federal and state law, the Independent
Directors (defined below) are counseled by their own independent legal counsel,
who participates in Board meetings and interacts with Flaherty &amp; Crumrine,
and also may benefit from information provided by the Funds&#146; and Flaherty &amp;
Crumrine&#146;s counsel; both counsel to the Independent Directors and counsel to the
Funds and Flaherty &amp; Crumrine have significant experience advising funds and
fund directors. The Boards and their committees have the ability to engage other
experts as appropriate. The Boards evaluate their performance on an annual
basis.</FONT></P>
<UL style="FONT-SIZE: 10pt; text-align: justify"><LI><FONT face="Times New Roman" size=2><U>Donald F. Crumrine</U> &#150; Mr. Crumrine has been
  the Chairman of the Boards of PFD and PFO since 2002 and</FONT> <FONT face="Times New Roman" size=2>Chairman of the Boards of FFC and FLC since each Fund&#146;s
  inception. Mr. Crumrine has over 36 years of</FONT> <FONT face="Times New Roman" size=2>experience managing portfolios of preferred securities. He co-founded
  Flaherty &amp; Crumrine in 1983, after</FONT> <FONT face="Times New Roman" size=2>spending
  twelve years at Scudder, Stevens &amp; Clark, to focus on managing preferred
  securities portfolios</FONT> <FONT face="Times New Roman" size=2>and associated hedges.
  Mr. Crumrine is actively involved in the day-to-day management of all Flaherty
  &amp;</FONT> <FONT face="Times New Roman" size=2>Crumrine client portfolios, including
  those of the Funds, and directs client service and marketing efforts at</FONT>
  <FONT face="Times New Roman" size=2>Flaherty &amp; Crumrine.<BR>&nbsp;</FONT>
  </LI><LI><FONT face="Times New Roman" size=2><U>David Gale</U> &#150; In addition to his tenure as a
  Director of the Funds, Mr. Gale has been President and Chief Executive</FONT>
  <FONT face="Times New Roman" size=2>Officer of Delta Dividend Group, Inc., a San
  Francisco-based investment management firm, since 1992. Prior to</FONT> <FONT face="Times New Roman" size=2>joining Delta Dividend Group, Inc., Mr. Gale was a Principal
  with Morgan Stanley from February 1983 to January</FONT> <FONT face="Times New Roman" size=2>1990, and a Managing Director of Lehman Brothers Holdings Inc. from
  January 1990 to January 1992. Mr. Gale</FONT> <FONT face="Times New Roman" size=2>currently serves as a director of Emmis Communications and served as a
  director of Metromedia International</FONT> <FONT face="Times New Roman" size=2>Group,
  Inc., a telecommunications company from 2005 through August 30,
  2008.<BR>&nbsp;</FONT>
  </LI><LI><FONT face="Times New Roman" size=2><U>Morgan Gust</U> &#150; In addition to his tenure as
  a Director of the Funds, Mr. Gust is the owner and operator of</FONT> <FONT face="Times New Roman" size=2>various entities engaged in agriculture and real estate.
  From 1990 to 2007, Mr. Gust served in various capacities,</FONT> <FONT face="Times New Roman" size=2>including President, Executive Vice President, General
  Counsel and Corporate Secretary of Giant Industries, Inc.,</FONT> <FONT face="Times New Roman" size=2>a petroleum refining and marketing company listed on the New
  York Stock Exchange (the &#147;NYSE&#148;). Mr. Gust</FONT> <FONT face="Times New Roman" size=2>currently serves as lead Director of CoBiz Financial, Inc., a publicly
  traded bank holding company. He is also a</FONT> <FONT face="Times New Roman" size=2>member of the Arizona State Bar.<BR>&nbsp;</FONT>
  </LI><LI><FONT face="Times New Roman" size=2><U>Karen H. Hogan</U> &#150; In addition to her tenure
  as a Director of the Funds, Ms. Hogan serves as a board member and</FONT>
  <FONT face="Times New Roman" size=2>committee member of several charitable and non-profit
  organizations. From September 1985 to January 1997,</FONT> <FONT face="Times New Roman" size=2>Ms. Hogan served as Senior Vice President of Preferred Stock
  Origination, and previously Vice President of New</FONT> <FONT face="Times New Roman" size=2>Product Development, at Lehman Brothers Holdings Inc.<BR>&nbsp;</FONT>
  </LI><LI><FONT face="Times New Roman" size=2><U>Robert F. Wulf</U> &#150; In addition to his tenure
  as a Director of the Funds, Mr. Wulf has worked as a financial
  consultant</FONT> <FONT face="Times New Roman" size=2>for over 29 years. Mr. Wulf also
  served as a board member of two non-profit organizations.</FONT> </LI></UL>
<P align=justify><FONT face="Times New Roman" size=2><U>Board Composition and Leadership
Structure</U></FONT></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp; <FONT face="Times New Roman" size=2>The 1940 Act
requires that at least 40% of the Funds&#146; Directors not be &#147;interested persons&#148;
(as defined in the 1940 Act) of the Funds, and therefore not affiliated with
Flaherty &amp; Crumrine (&#147;Independent Directors&#148;). To rely on certain exemptive
rules under the 1940 Act, a majority of the Funds&#146; Directors must be Independent
Directors and, for certain important matters, such as the approval of investment
advisory agreements or transactions with affiliates, the 1940 Act or the rules
thereunder require the approval of a majority of the Independent Directors.
Currently, four of the Funds&#146; five Directors are Independent Directors. The
Chairman of the Boards is an interested person of the Funds. The four
Independent Directors interact directly with the Chairman and other senior
management of Flaherty &amp; Crumrine at scheduled meetings and between meetings
as appropriate. Independent Directors have been designated to chair the Audit
Committees and the Nominating and Governance Committees, and the Independent
Directors rotate the responsibility for chairing meetings of Independent
Directors. In addition, from time to time, one or more Independent Directors may
be designated, formally or informally, to take the lead in addressing with
management or their independent legal counsel matters or issues of concern to
the Boards. As a result, the Boards have determined that their leadership
structures and composition, in which no individual Independent Director has been
designated to lead all the Independent Directors, are appropriate in light of
the Boards&#146; size and the cooperative and dynamic working relationship among the
Independent Directors and the Independent Directors&#146; open lines of communication
with Fund management. The Boards have determined that their leadership
structures and composition, in which the Chairman </FONT></P>
<P align=center><FONT face="Times New Roman" size=2>6</FONT></P>
<HR align=center width="100%" noShade SIZE=2>

<DIV style="PAGE-BREAK-BEFORE: always"></DIV><BR>
<P align=justify><FONT face="Times New Roman" size=2>of the Boards is an &#147;interested person&#148;
of the Funds and 80% of the Directors are Independent Directors, are appropriate
in light of the services that Flaherty &amp; Crumrine provides to the Funds and
potential conflicts of interest that could arise from these
relationships.</FONT></P>
<P align=justify><FONT face="Times New Roman" size=2><U>Boards&#146; Oversight Role in
Management</U></FONT></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Boards&#146; role in management of the Funds is oversight. As is the case with
virtually all investment companies (as distinguished from operating companies),
service providers to the Funds, primarily Flaherty &amp; Crumrine, have
responsibility for the day-to-day management of the Funds, which includes
responsibility for risk management (including management of investment
performance and investment risk, valuation risk, issuer and counterparty credit
risk, compliance risk and operational risk). As part of their oversight, the
Boards, acting at their scheduled meetings, or the Chairman, acting between
Board meetings, regularly interacts with and receives reports from senior
personnel of service providers, including the Funds&#146; and Flaherty &amp;
Crumrine&#146;s Chief Compliance Officer and portfolio management personnel. The
Boards&#146; Audit Committees (which consist of all the Independent Directors) meet
during their scheduled meetings, and between meetings the Audit Committee chairs
maintain contact, with the Funds&#146; independent registered public accounting firm
and the Funds&#146; Chief Financial Officer. The Boards also receive periodic
presentations from senior personnel of Flaherty &amp; Crumrine regarding risk
management generally, as well as periodic presentations regarding specific
operational, compliance or investment areas, such as business continuity,
personal trading, valuation and credit. The Boards have adopted policies and
procedures designed to address certain risks to the Funds. In addition, Flaherty
&amp; Crumrine and other service providers to the Funds have adopted a variety
of policies, procedures and controls designed to address particular risks to the
Funds. Different processes, procedures and controls are employed with respect to
different types of risks. However, it is not possible to eliminate all of the
risks applicable to the Funds. The Boards also receive reports from counsel to
the Funds and Flaherty &amp; Crumrine and the Independent Directors&#146; own
independent legal counsel regarding regulatory, compliance and governance
matters. The Boards&#146; oversight role does not make the Boards guarantors of the
Funds&#146; investments or activities.</FONT></P>
<P align=justify><B><FONT face="Times New Roman" size=2>Beneficial Ownership of Shares in
Funds and Fund Complex for each Director and Nominee for Election as Director
</FONT></B></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Set forth in the table below is the dollar range of equity securities in each
Fund and the aggregate dollar range of equity securities in the Flaherty &amp;
Crumrine Fund Family beneficially owned by each Director and Nominee for
Election as Director. </FONT></P>
<TABLE style="LINE-HEIGHT: 14pt; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=bottom>
    <TD noWrap align=left width="62%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="20%" colSpan=2><FONT face="Times New Roman" size=2>Aggregate Dollar
      Range of Equity</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="62%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="20%" colSpan=2><FONT face="Times New Roman" size=2>Securities in All
      Registered Investment</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="62%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="15%" colSpan=7><FONT face="Times New Roman" size=2>Dollar Range of
      Equity</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="20%" colSpan=2><FONT face="Times New Roman" size=2>Companies Overseen by
      Director in Family</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD  style="padding-bottom: 2pt" noWrap align=left width="62%"><FONT face="Times New Roman" size=2 style="BORDER-BOTTOM: #000000 1pt solid">Name of Director or Nominee</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="15%" colSpan=7><FONT face="Times New Roman" size=2>Securities Held in Fund*(1)</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="20%" colSpan=2><FONT face="Times New Roman" size=2>of Investment Companies*(2)</FONT></TD></TR>
  <TR>
    <TD noWrap align=left width="62%"></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="20%" colSpan=2>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="62%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="3%"><FONT face="Times New Roman" size=2>PFD</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="3%"><FONT face="Times New Roman" size=2>PFO</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="3%"><FONT face="Times New Roman" size=2>FFC</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="3%"><FONT face="Times New Roman" size=2>FLC</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="1%"><FONT face="Times New Roman" size=2>Total</FONT></TD>
    <TD noWrap align=left width="19%">&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="62%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>NON-INTERESTED</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="20%" bgColor=#c0c0c0 colSpan=2></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="62%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>DIRECTORS/NOMINEES:</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="20%" bgColor=#c0c0c0 colSpan=2></TD></TR>
  <TR>
    <TD noWrap align=left width="62%">&nbsp;</TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="20%" colSpan=2></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="62%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>David Gale</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>D</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>D</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>D</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>D</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="20%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>E</FONT></TD></TR>
  <TR>
    <TD noWrap align=left width="62%">&nbsp;</TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="20%" colSpan=2></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="62%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Morgan Gust</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>D</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>D</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>C</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>C</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="20%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>E</FONT></TD></TR>
  <TR>
    <TD noWrap align=left width="62%">&nbsp;</TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="20%" colSpan=2></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="62%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Karen H.
    Hogan</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>B</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>B</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>B</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>B</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="20%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>C</FONT></TD></TR>
  <TR>
    <TD noWrap align=left width="62%">&nbsp;</TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="20%" colSpan=2></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="62%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Robert F.
    Wulf</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>C</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>C</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>E</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>E</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="20%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>E</FONT></TD></TR>
  <TR>
    <TD noWrap align=left width="62%">&nbsp;</TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="20%" colSpan=2></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="62%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>INTERESTED DIRECTOR/NOMINEE:</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="20%" bgColor=#c0c0c0 colSpan=2></TD></TR>
  <TR>
    <TD noWrap align=left width="62%">&nbsp;</TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="20%" colSpan=2></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="62%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Donald F.
      Crumrine</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2><SUP></SUP></FONT></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>E<SUP>(3)</SUP></FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2><SUP></SUP></FONT></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>E<SUP>(3)</SUP></FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2><SUP></SUP></FONT></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>E<SUP>(3)</SUP></FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2><SUP></SUP></FONT></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>E<SUP>(3)</SUP></FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2><SUP></SUP></FONT></TD>
    <TD noWrap align=left width="20%" bgColor=#c0c0c0 colSpan=2><FONT face="Times New Roman" size=2>E<SUP>(3)</SUP></FONT></TD></TR></TABLE><BR>
<P align=center><FONT face="Times New Roman" size=2>7</FONT></P>
<HR align=center width="100%" noShade SIZE=2>

<DIV style="PAGE-BREAK-BEFORE: always"></DIV><BR>
<P align=justify><FONT face="Times New Roman" size=2>____________________</FONT></P>

<TABLE cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR>
    <TD style="BORDER-TOP: #ffffff 3pt solid" vAlign=top width="1%"><FONT face="Times New Roman" size=2>*</FONT></TD>
    <TD vAlign=top width="1%"><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </FONT></TD>
    <TD style="BORDER-TOP: #ffffff 3pt solid" vAlign=top width="98%">
      <P align=justify><FONT face="Times New Roman" size=2>&nbsp;Key to Dollar
      Ranges </FONT></P></TD></TR>
  <TR>
    <TD style="BORDER-TOP: #ffffff 3pt solid" vAlign=top width="1%"><FONT face="Times New Roman" size=2>A.</FONT></TD>
    <TD vAlign=top width="1%"></TD>
    <TD style="BORDER-TOP: #ffffff 3pt solid" vAlign=top width="98%">
      <P align=justify><FONT face="Times New Roman" size=2>None</FONT></P></TD></TR>
  <TR>
    <TD style="BORDER-TOP: #ffffff 3pt solid" vAlign=top width="1%"><FONT face="Times New Roman" size=2>B.</FONT></TD>
    <TD vAlign=top width="1%"></TD>
    <TD style="BORDER-TOP: #ffffff 3pt solid" vAlign=top width="98%">
      <P align=justify><FONT face="Times New Roman" size=2>$1 - $10,000
      </FONT></P></TD></TR>
  <TR>
    <TD style="BORDER-TOP: #ffffff 3pt solid" vAlign=top width="1%"><FONT face="Times New Roman" size=2>C. </FONT></TD>
    <TD vAlign=top width="1%"></TD>
    <TD style="BORDER-TOP: #ffffff 3pt solid" vAlign=top width="98%">
      <P align=justify><FONT face="Times New Roman" size=2>$10,001 -$50,000
      </FONT></P></TD></TR>
  <TR>
    <TD style="BORDER-TOP: #ffffff 3pt solid" vAlign=top width="1%"><FONT face="Times New Roman" size=2>D.</FONT></TD>
    <TD vAlign=top width="1%"></TD>
    <TD style="BORDER-TOP: #ffffff 3pt solid" vAlign=top width="98%">
      <P align=justify><FONT face="Times New Roman" size=2>$50,001 - $100,000
      </FONT></P></TD></TR>
  <TR>
    <TD style="BORDER-TOP: #ffffff 3pt solid" vAlign=top width="1%"><FONT face="Times New Roman" size=2>E.</FONT></TD>
    <TD vAlign=top width="1%"></TD>
    <TD style="BORDER-TOP: #ffffff 3pt solid" vAlign=top width="98%">
      <P align=justify><FONT face="Times New Roman" size=2>over
      $100,000</FONT></P></TD></TR>
  <TR>
    <TD vAlign=top width="1%"></TD>
    <TD vAlign=top width="1%"></TD>
    <TD style="BORDER-TOP: #ffffff 3pt solid" vAlign=top width="98%">
      <P align=justify><FONT face="Times New Roman" size=2>All shares were
      valued as of January 18, 2013.</FONT></P></TD></TR>
  <TR>
    <TD vAlign=top width="1%"><FONT face="Times New Roman" size=2><SUP>(1)</SUP></FONT></TD>
    <TD vAlign=top width="1%"></TD>
    <TD style="BORDER-TOP: #ffffff 3pt solid" vAlign=top width="98%">
      <P align=justify><FONT face="Times New Roman" size=2>This information has
      been furnished by each Director/Nominee as of January 18, 2013.
      &#147;Beneficial ownership&#148; is determined in accordance with Rule 16a-1(a)(2)
      under the 1934 Act.</FONT></P></TD></TR>
  <TR>
    <TD vAlign=top width="1%"><FONT face="Times New Roman" size=2><SUP>(2)</SUP></FONT></TD>
    <TD vAlign=top width="1%"></TD>
    <TD style="BORDER-TOP: #ffffff 3pt solid" vAlign=top width="98%">
      <P align=justify><FONT face="Times New Roman" size=2>The Directors,
      Nominees and executive officers of each Fund, as a group, own less than 1%
      of each Fund. </FONT></P></TD></TR>
  <TR>
    <TD vAlign=top width="1%"><FONT face="Times New Roman" size=2><SUP>(3)</SUP></FONT></TD>
    <TD vAlign=top width="1%"></TD>
    <TD style="BORDER-TOP: #ffffff 3pt solid" vAlign=top width="98%">
      <P align=justify><FONT face="Times New Roman" size=2>Includes shares of
      the Fund held by Flaherty &amp; Crumrine, of which Mr. Crumrine is a
      shareholder and Director.</FONT></P></TD></TR></TABLE>
<P align=justify><B><FONT face="Times New Roman" size=2>Officers of the Funds</FONT></B></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The following table provides information concerning each of the officers of the
Funds.</FONT></P>
<TABLE style="LINE-HEIGHT: 14pt; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=bottom>
    <TD noWrap align=left width="18%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="18%"><FONT face="Times New Roman" size=2>Current Position(s)</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="27%"><FONT face="Times New Roman" size=2>Term of Office and Length of</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="33%"><FONT face="Times New Roman" size=2>Principal Occupation
During</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%"><FONT face="Times New Roman" size=2 style="BORDER-BOTTOM: #000000 1pt solid">Name, Address and Age</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="18%"><FONT face="Times New Roman" size=2>Held with Funds</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="27%"><FONT face="Times New Roman" size=2>Time Served*</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="33%"><FONT face="Times New Roman" size=2>Past Five Years</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>Robert M. Ettinger</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>President</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFD &#150; since
      2002</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>President and
      Director</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>301 E. Colorado
      Boulevard</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFO &#150; since
      2002</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>of Flaherty &amp;
      Crumrine</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Suite 720</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FFC &#150; since
      inception</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Pasadena, CA
      91101</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FLC &#150; since
      inception</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Age: 54</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0></TD></TR>
  <TR>
    <TD width="99%" colSpan=7>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>R. Eric Chadwick</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Chief
    Financial</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFD &#150; since
      2004</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Vice President and
      Director of</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>301 E. Colorado
      Boulevard</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Officer,
    Vice</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFO &#150; since
      2004</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Flaherty &amp;
      Crumrine</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Suite 720</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>President
    and</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FFC &#150; since
      2004</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Pasadena, CA
      91101</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Treasurer</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FLC &#150; since
      2004</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Age: 37</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0></TD></TR>
  <TR>
    <TD width="99%" colSpan=7>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>Chad C. Conwell</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Chief
      Compliance</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFD &#150; since
      2005</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Chief Compliance
      Officer and Vice</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>301 E. Colorado
      Boulevard</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Officer,
    Vice</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFO &#150; since
      2005</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>President of Flaherty
      &amp; Crumrine;</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Suite 720</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>President
    and</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FFC &#150; since
      2005</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Director of Flaherty
      &amp; Crumrine</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Pasadena, CA
      91101</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Secretary</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FLC &#150; since
      2005</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>since January
      2011</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Age: 40</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0></TD></TR>
  <TR>
    <TD width="99%" colSpan=7>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>Bradford S. Stone</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Vice President
      and</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFD &#150; since
      2003</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Vice President and
      Director of</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>47 Maple
    Street</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Assistant</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFO &#150; since
      2003</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Flaherty &amp;
      Crumrine</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Suite 403</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Treasurer</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FFC &#150; since
      2003</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Summit, NJ
      07901</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FLC &#150; since
      inception</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Age: 53</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0></TD></TR>
  <TR>
    <TD width="99%" colSpan=7>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>Laurie C. Lodolo</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Assistant
      Compliance</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFD &#150; since
      2004</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Assistant Compliance
      Officer and</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>301 E. Colorado
      Boulevard</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Officer,
      Assistant</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFO &#150; since
      2004</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Secretary of Flaherty
      &amp; Crumrine</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Suite 720</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Treasurer
    and</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FFC &#150; since
      2004</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Pasadena, CA
      91101</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Assistant
      Secretary</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FLC &#150; since
      2004</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Age: 49</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0></TD></TR>
  <TR>
    <TD width="99%" colSpan=7>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><B><FONT face="Times New Roman" size=2>Linda M. Puchalski</FONT></B></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Assistant
      Treasurer</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFD &#150; since
      2010</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Administrator of
      Flaherty &amp; Crumrine</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>301 E. Colorado
      Boulevard</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFO &#150; since
      2010</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Suite 720</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FFC &#150; since
      2010</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Pasadena, CA
      91101</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FLC &#150; since
      2010</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Age: 56</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="18%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="27%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="33%" bgColor=#c0c0c0></TD></TR></TABLE>____________________<BR>
<P align=justify><FONT face="Times New Roman" size=2>*&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Each officer serves until his or her successor is elected and qualified or until
his or her earlier resignation or removal.</FONT></P>
<P align=center><FONT face="Times New Roman" size=2>8</FONT></P>
<HR align=center width="100%" noShade SIZE=2>

<DIV style="PAGE-BREAK-BEFORE: always"></DIV><BR>
<P align=justify><B><FONT face="Times New Roman" size=2>Audit Committee Report
</FONT></B></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The role of each Fund&#146;s Audit Committee is to assist the Board of Directors in
its oversight of: (i) the integrity of the Fund&#146;s financial statements and the
independent audit thereof; (ii) the Fund&#146;s accounting and financial reporting
policies and practices, its internal controls and, as appropriate, the internal
controls of certain service providers; (iii) the Fund&#146;s compliance with legal
and regulatory requirements; and (iv) the independent auditor&#146;s qualifications,
independence and performance. Each Fund&#146;s Audit Committee is also required to
prepare an audit committee report pursuant to the rules of the SEC for inclusion
in the Fund&#146;s annual proxy statement. Each Audit Committee operates pursuant to
a charter (the &#147;Audit Committee Charter&#148; or &#147;Charter&#148;) that was most recently
reviewed and approved by the Board of Directors of each Fund on January 22, 2013
and which is available at www.preferredincome.com. As set forth in the Charter,
management is responsible for the (i) preparation, presentation and integrity of
each Fund&#146;s financial statements, (ii) maintenance of appropriate accounting and
financial reporting principles and policies and (iii) maintenance of internal
controls and procedures designed to assure compliance with accounting standards
and applicable laws and regulations. The Funds&#146; independent registered public
accounting firm, KPMG LLP (the &#147;independent accountants&#148; or &#147;KPMG&#148;), is
responsible for planning and carrying out proper audits and reviews of each
Fund&#146;s financial statements and expressing an opinion as to their conformity
with accounting principles generally accepted in the United States of America.
</FONT></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; In
performing its oversight function, at a meeting held on January 22, 2013, each
Audit Committee reviewed and discussed with management of the Fund and the
independent accountants, the audited financial statements of the Fund as of and
for the fiscal year ended November 30, 2012, and discussed the audit of such
financial statements with the independent accountants. </FONT></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; In
addition, each Audit Committee discussed with the independent accountants the
accounting principles applied by the Fund and such other matters brought to the
attention of the Audit Committee by the independent accountants required by
Statement of Auditing Standards No. 61, as amended (AICPA, </FONT><I><FONT face="Times New Roman" size=2>Professional Standards</FONT></I><FONT face="Times New Roman" size=2>,
Vol. 1 AU Section 380), as adopted by the Public Company Accounting Oversight
Board in Rule 3200T. Each Audit Committee also received from the independent
accountants the written disclosures and statements required by the SEC&#146;s
independence rules, delineating relationships between the independent
accountants and the Fund and discussed the impact that any such relationships
might have on the objectivity and independence of the independent accountants.
</FONT></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; As
set forth above, and as more fully set forth in each Fund&#146;s Audit Committee
Charter, the Audit Committee has significant duties and powers in its oversight
role with respect to the Fund&#146;s financial reporting procedures, internal control
systems, and the independent audit process. </FONT></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The members of each Audit Committee are not, and do not represent themselves to
be, professionally engaged in the practice of auditing or accounting and are not
employed by the Fund for accounting, financial management or internal control.
Moreover, the Audit Committee relies on and makes no independent verification of
the facts presented to it or representations made by management or the
independent accountants. Accordingly, the Audit Committee&#146;s oversight does not
provide an independent basis to determine that management has maintained
appropriate accounting and financial reporting principles and policies, or
internal controls and procedures, designed to assure compliance with accounting
standards and applicable laws and regulations. Furthermore, the Audit
Committee&#146;s considerations and discussions referred to above do not provide
assurance that the audit of each Fund&#146;s financial statements has been carried
out in accordance with generally accepted accounting standards or that the
financial statements are presented in accordance with generally accepted
accounting principles. </FONT></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Based on its consideration of the audited financial statements and the
discussions referred to above with management and the independent accountants,
and subject to the limitations on the responsibilities and role of the Audit
Committee set forth in the Charter and those discussed above, the Audit
Committee of each Fund recommended to that Fund&#146;s Board that the audited
financial statements be included in the Fund&#146;s Annual Report for the fiscal year
ended November 30, 2012. </FONT></P>
<P align=justify><B><FONT face="Times New Roman" size=2>This report was submitted by the
Audit Committee of each Fund&#146;s Board of Directors <BR></FONT></B><FONT face="Times New Roman" size=2>David Gale <BR>Morgan Gust <BR>Karen H. Hogan <BR></FONT><FONT face="Times New Roman" size=2>Robert F. Wulf (Chairman) </FONT></P>
<P align=justify><FONT face="Times New Roman" size=2>January 22, 2013</FONT></P>
<P align=center><FONT face="Times New Roman" size=2>9</FONT></P>
<HR align=center width="100%" noShade SIZE=2>

<DIV style="PAGE-BREAK-BEFORE: always"></DIV><BR>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Each Audit Committee was established in accordance with Section 3(a)(58)(A) of
the 1934 Act. Each Audit Committee met four times in connection with its Board
of Directors&#146; regularly scheduled meetings during the fiscal year ended November
30, 2012. Each Audit Committee is composed entirely of each Fund&#146;s Independent
Directors who are also &#147;independent&#148; (as such term is defined by the NYSE under
the listing standards applicable to closed-end funds, as may be modified or
supplemented (the &#147;NYSE Listing Standards&#148;)), namely Ms. Hogan and Messrs. Gale,
Gust and Wulf. </FONT></P>
<P align=justify><B><FONT face="Times New Roman" size=2>Nominating and Governance Committee
</FONT></B></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Each Board of Directors has a Nominating and Governance Committee composed
entirely of each Fund&#146;s Independent Directors who are also &#147;independent&#148; (as
such term is defined by the NYSE Listing Standards), namely Ms. Hogan and
Messrs. Gale, Gust and Wulf. The Nominating and Governance Committee of each
Fund met twice during the fiscal year ended November 30, 2012. The Nominating
and Governance Committee is responsible for identifying individuals believed to
be qualified to become Board members; for recommending to the Board such
nominees to stand for election as directors at each Fund&#146;s annual meeting of
shareholders and to fill any vacancies on the Board; and for overseeing the
Boards&#146; governance practices. Each Fund&#146;s Nominating and Governance Committee
has a charter which is available on its website, www.preferredincome.com.
</FONT></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Each Fund&#146;s Nominating and Governance Committee believes that it is in the best
interest of the Fund and its shareholders to obtain highly qualified candidates
to serve as members of the Board. The Nominating and Governance Committees have
not established a formal process for identifying candidates where a vacancy
exists on the Board. In nominating candidates, each Nominating and Governance
Committee shall take into consideration such factors as it deems appropriate,
including educational background; business, professional training or practice
(e.g., accounting or law); public service or academic positions; experience from
service as a board member (including the Boards of the Funds) or as an executive
of investment funds, public companies or significant private or not-for-profit
entities or other organizations; and/or other life experiences. Each Fund&#146;s
Nominating and Governance Committee may consider whether a potential nominee&#146;s
professional experience, education, skills, and other individual qualities and
attributes, including gender, race or national origin, would provide beneficial
diversity of skills, experience or perspective to the Board&#146;s membership and
collective attributes. Each Fund&#146;s Nominating and Governance Committee will
consider director candidates recommended by shareholders and submitted in
accordance with applicable law and procedures as described in this Joint Proxy
Statement. (See &#147;Submission of Shareholder Proposals&#148; below.) </FONT></P>
<P align=justify><B><FONT face="Times New Roman" size=2>Other Board-Related Matters
</FONT></B></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Shareholders who wish to send communications to the Board should send them to
the address of their Fund(s) and to the attention of the Board. All such
communications will be directed to the Board&#146;s attention. </FONT></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The Funds do not have a formal policy regarding Board member attendance at the
Annual Meeting of Shareholders. However, all of the Directors of each Fund
attended the April 19, 2012 Annual Meetings of Shareholders.</FONT></P>
<P align=justify><B><FONT face="Times New Roman" size=2>Board Compensation</FONT></B></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Each Director of each Fund who is not a director, officer or employee of
Flaherty &amp; Crumrine or any of its affiliates receives from each Fund a fee
of $9,000 per annum plus $750 for each in-person Board of Directors or Audit
Committee meeting attended, $500 for each in-person Nominating and Governance
Committee meeting attended, and $250 for each telephone meeting attended. In
addition, the Audit Committee Chairman receives from each Fund an annual fee of
$3,000. Each Director of each Fund is reimbursed for travel and out-of-pocket
expenses associated with attending Board and committee meetings. During the
fiscal year ended November 30, 2012, the Board of Directors for each Fund held
six meetings (two of which were </FONT></P>
<P align=center><FONT face="Times New Roman" size=2>10</FONT></P>
<HR align=center width="100%" noShade SIZE=2>

<DIV style="PAGE-BREAK-BEFORE: always"></DIV><BR>
<P align=justify><FONT face="Times New Roman" size=2>held by telephone conference call).
Each Director of each Fund attended at least 75% of the meetings of Directors
and of any Committee of which he or she is a member. The aggregate remuneration
paid to the Directors of each Fund for the fiscal year ended November 30, 2012
is set forth below: </FONT></P>
<DIV align=center>
<TABLE style="LINE-HEIGHT: 14pt; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="95%" border=0>

  <TR vAlign=bottom>
    <TD noWrap align=left width="10%"></TD>
    <TD noWrap align=left width="56%"></TD>
    <TD noWrap align=left width="12%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="7%"><FONT face="Times New Roman" size=2>Board Meeting</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="12%"></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="10%"></TD>
    <TD noWrap align=left width="56%"></TD>
    <TD noWrap align=left width="12%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="7%"><FONT face="Times New Roman" size=2>and Committee</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="12%"><FONT face="Times New Roman" size=2>Travel and Out-of-Pocket</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="10%"></TD>
    <TD noWrap align=left width="56%"></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="12%"><FONT face="Times New Roman" size=2>Annual Director Fees</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="7%"><FONT face="Times New Roman" size=2>Meeting Fees</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="12%"><FONT face="Times New Roman" size=2>Expenses*</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="10%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFD</FONT></TD>
    <TD noWrap align=left width="56%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="12%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$36,000</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="7%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$33,000</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="12%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$3,148</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="10%"><FONT face="Times New Roman" size=2>PFO</FONT></TD>
    <TD noWrap align=left width="56%"></TD>
    <TD noWrap align=left width="12%"><FONT face="Times New Roman" size=2>$36,000</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="7%"><FONT face="Times New Roman" size=2>$33,000</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="12%"><FONT face="Times New Roman" size=2>$3,098</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="10%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FFC</FONT></TD>
    <TD noWrap align=left width="56%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="12%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$36,000</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="7%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$33,000</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="12%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$3,098</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="10%"><FONT face="Times New Roman" size=2>FLC</FONT></TD>
    <TD noWrap align=left width="56%"></TD>
    <TD noWrap align=left width="12%"><FONT face="Times New Roman" size=2>$36,000</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="7%"><FONT face="Times New Roman" size=2>$33,000</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;</TD>
    <TD noWrap align=left width="12%"><FONT face="Times New Roman" size=2>$3,098</FONT></TD></TR></TABLE></DIV>____________________<BR>
<P align=justify><FONT face="Times New Roman" size=2>*&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Includes reimbursement for travel and out-of-pocket expenses for both
&#147;interested&#148; and Independent Directors. </FONT></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="Times New Roman" size=2>The following table sets forth
additional information regarding the compensation of each Fund&#146;s Directors for
the fiscal year ended November 30, 2012. No executive officer or person
affiliated with a Fund received compensation from a Fund during the fiscal year
ended November 30, 2012 in excess of $60,000. Directors and executive officers
of the Funds do not receive pension or retirement benefits from the Funds.
</FONT></P>
<P STYLE="text-align: center"><B><FONT face="Times New Roman" size=2>COMPENSATION TABLE</FONT></B></P>
<TABLE style="LINE-HEIGHT: 14pt; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=bottom>
    <TD noWrap style="text-align: center" width="53%"><FONT face="Times New Roman" size=2>Name of</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="19%"><FONT face="Times New Roman" size=2>Aggregate</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="25%"><FONT face="Times New Roman" size=2>Total Compensation from</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap style="text-align: center" width="53%"><FONT face="Times New Roman" size=2>Person and</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="19%"><FONT face="Times New Roman" size=2>Compensation</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="25%"><FONT face="Times New Roman" size=2>the Funds and Fund</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD style="BORDER-BOTTOM: #000000 1pt solid; text-align: center" noWrap width="53%"><FONT face="Times New Roman" size=2>Position</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="19%"><FONT face="Times New Roman" size=2>from each Fund</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="25%"><FONT face="Times New Roman" size=2>Complex Paid to Directors*</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="53%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Donald F.
      Crumrine</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="19%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$0</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="25%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$0 (4)</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="53%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Director, Chairman of
      the Board and Chief Executive Officer</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="19%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="25%" bgColor=#c0c0c0></TD></TR>
  <TR>
    <TD width="99%" colSpan=5>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="53%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>David Gale</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="19%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$16,500 &#150;
    PFD</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="25%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$66,000
  (4)</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="53%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Director</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="19%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$16,500 &#150;
    PFO</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="25%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="53%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="19%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$16,500 &#150;
    FFC</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="25%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="53%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="19%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$16,500 &#150;
    FLC</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="25%" bgColor=#c0c0c0></TD></TR>
  <TR>
    <TD width="99%" colSpan=5>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="53%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Morgan Gust</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="19%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$16,500 &#150;
    PFD</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="25%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$66,000
  (4)</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="53%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Director, Nominating
      and Governance Committee Chairman</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="19%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$16,500 &#150;
    PFO</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="25%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="53%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="19%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$16,500 &#150;
    FFC</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="25%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="53%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="19%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$16,500 &#150;
    FLC</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="25%" bgColor=#c0c0c0></TD></TR>

  <TR>
    <TD width="99%" colSpan=5>&nbsp;</TD></TR>

  <TR vAlign=bottom>
    <TD noWrap align=left width="53%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Karen H.
    Hogan</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="19%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$16,500 &#150;
    PFD</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="25%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$66,000
  (4)</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="53%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Director</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="19%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$16,500 &#150;
    PFO</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="25%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="53%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="19%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$16,500 &#150;
    FFC</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="25%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="53%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="19%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$16,500 &#150;
    FLC</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="25%" bgColor=#c0c0c0></TD></TR>
  <TR>
    <TD width="99%" colSpan=5>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="53%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Robert F.
    Wulf</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="19%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$19,500 &#150;
    PFD</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="25%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$78,000
  (4)</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="53%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>Director, Audit
      Committee Chairman</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="19%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$19,500 &#150;
    PFO</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="25%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="53%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="19%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$19,500 &#150;
    FFC</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="25%" bgColor=#c0c0c0></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="53%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="19%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$19,500 &#150;
    FLC</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="25%" bgColor=#c0c0c0></TD></TR></TABLE>____________________<BR>&nbsp;<BR>
<TABLE style="TEXT-ALIGN: justify" cellSpacing=0 cellPadding=0 border=0>

  <TR>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>*</FONT></TD>
    <TD vAlign=top noWrap>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD width="100%"><FONT face="Times New Roman" size=2>Represents the total compensation
      paid for the fiscal year ended November 30, 2012, to such persons by the
      Funds, which are considered part of the same &#147;fund complex&#148; because they
      have a common adviser. The parenthetical number represents the total
      number of investment company directorships held by the Director or Nominee
      in the fund complex as of November 30, 2012.</FONT></TD></TR></TABLE>
<P align=center><FONT face="Times New Roman" size=2>11</FONT></P>
<HR align=center width="100%" noShade SIZE=2>

<DIV style="PAGE-BREAK-BEFORE: always"></DIV><BR>
<P align=justify><B><FONT face="Times New Roman" size=2>Required Vote </FONT></B></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
The election of Mr. Gust as a Director of PFD and the election of Mr. Crumrine
and Mr. Wulf as Directors of PFO, FFC and FLC, will require the affirmative vote
of a plurality of the vote cast by holders of the Shares of Common Stock of each
such Fund at the Meeting in person or by proxy. </FONT></P>
<P align=center><B><FONT face="Times New Roman" size=2>SUBMISSION OF SHAREHOLDER
PROPOSALS</FONT></B></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
All proposals by shareholders of each Fund that are intended to be presented at
each Fund&#146;s next Annual Meeting of Shareholders to be held in 2014 must be
received by the relevant Fund for consideration for inclusion in the relevant
Fund&#146;s proxy statement relating to the meeting no later than November 11, 2013,
and must satisfy the requirements of federal securities laws. </FONT></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Each Fund&#146;s Bylaws require shareholders wishing to nominate Directors or make
proposals to be voted on at the Fund&#146;s Annual Meeting to provide timely advance
notice of the proposal in writing. To be considered timely, any such advance
notice must be in writing delivered to or mailed and received at the principal
executive offices of the Fund at the address set forth on the first page of this
proxy statement not earlier than the 150<SUP>th</SUP> day nor later than 5:00
p.m., Eastern Time, on the 120<SUP>th </SUP>day prior to the first anniversary
of the date of the proxy statement for the preceding year&#146;s annual meeting;
provided, however, that in the event that the date of the annual meeting is
advanced or delayed by more than 30 days from the first anniversary of the date
of the preceding year&#146;s annual meeting, notice by the shareholder to be timely
must be so delivered not earlier than the 150<SUP>th</SUP> day prior to the date
of such annual meeting and not later than 5:00 p.m., Eastern Time, on the later
of the 120<SUP>th</SUP> day prior to the date of such annual meeting, as
originally convened, or the tenth day following the day on which public
announcement of the date of such meeting is first made.</FONT></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Any such notice by a shareholder shall set forth the information required by the
Fund&#146;s Bylaws with respect to each matter the shareholder proposes to bring
before the annual meeting. </FONT></P>
<P align=center><B><FONT face="Times New Roman" size=2>ADDITIONAL INFORMATION</FONT></B></P>
<P align=justify><B><FONT face="Times New Roman" size=2>Independent Registered Public
Accounting Firm </FONT></B></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
KPMG, Two Financial Center, 60 South Street, Boston, Massachusetts 02111, has
been selected to serve as each Fund&#146;s independent registered public accounting
firm for each Fund&#146;s fiscal year ending November 30, 2013. KPMG acted as the
independent registered public accounting firm for each Fund for the fiscal year
ended November 30, 2012. The Funds know of no direct financial or material
indirect financial interest of KPMG in the Funds. A representative of KPMG will
not be present at the Meetings, but will be available by telephone to respond to
appropriate questions and will have an opportunity to make a statement, if
asked. </FONT></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<FONT face="Times New Roman" size=2>Set forth in the table below are audit
fees and non-audit related fees billed to each Fund by KPMG for professional
services for the fiscal years ended November 30, 2011 and 2012, respectively.
</FONT></P>
<TABLE style="LINE-HEIGHT: 14pt; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="75%"></TD>
    <TD noWrap align=left width="5%"><FONT face="Times New Roman" size=2>Fiscal Year Ended</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="4%"><FONT face="Times New Roman" size=2>Audit-Related</FONT></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="3%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="5%"></TD></TR>
  <TR vAlign=bottom>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="1%"><FONT face="Times New Roman" size=2>Fund</FONT></TD>
    <TD noWrap align=left width="75%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="5%"><FONT face="Times New Roman" size=2>November 30</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="3%"><FONT face="Times New Roman" size=2>Audit Fees</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="4%"><FONT face="Times New Roman" size=2>Fees</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="3%"><FONT face="Times New Roman" size=2>Tax Fees*</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="5%"><FONT face="Times New Roman" size=2>All Other Fees</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFD</FONT></TD>
    <TD noWrap align=left width="75%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>2011</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$45,000</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="4%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$0</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$8,270</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$0</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="75%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>2012</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$45,000</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="4%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$0</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$8,650</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$0</FONT></TD></TR>
  <TR>
    <TD width="100%" colSpan=11>&nbsp; </TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>PFO</FONT></TD>
    <TD noWrap align=left width="75%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>2011</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$45,000</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="4%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$0</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$8,270</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$0</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="75%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>2012</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$45,000</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="4%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$0</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$8,650</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$0</FONT></TD></TR>
  <TR>
    <TD width="100%" colSpan=11>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FFC</FONT></TD>
    <TD noWrap align=left width="75%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>2011</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$47,500</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0>&nbsp;</TD>
    <TD noWrap align=left width="4%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$0</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$8,270</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$0</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="75%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>2012</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$47,500</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="4%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$0</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$8,650</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$0</FONT></TD></TR>
  <TR>
    <TD width="100%" colSpan=11>&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>FLC</FONT></TD>
    <TD noWrap align=left width="75%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>2011</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$47,500</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="4%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$0</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$8,270</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$0</FONT></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="75%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>2012</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$47,500</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="4%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$0</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="3%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$8,650</FONT></TD>
    <TD noWrap align=left width="1%" bgColor=#c0c0c0></TD>
    <TD noWrap align=left width="5%" bgColor=#c0c0c0><FONT face="Times New Roman" size=2>$0</FONT></TD></TR></TABLE>____________________<BR>&nbsp;<BR>
<TABLE style="TEXT-ALIGN: justify" cellSpacing=0 cellPadding=0 border=0>

  <TR>
    <TD vAlign=top noWrap><FONT face="Times New Roman" size=2>*</FONT></TD>
    <TD vAlign=top noWrap>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; </TD>
    <TD width="100%"><FONT face="Times New Roman" size=2>&#147;Tax Fees&#148; are those fees billed
      to each Fund by KPMG in connection with tax consulting services, including
      primarily the review of each Fund&#146;s income tax
  returns.</FONT></TD></TR></TABLE>
<P align=center><FONT face="Times New Roman" size=2>12</FONT></P>
<HR align=center width="100%" noShade SIZE=2>

<DIV style="PAGE-BREAK-BEFORE: always"></DIV><BR>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Each Fund&#146;s Audit Committee Charter requires that the Audit Committee
pre-approve all audit and non-audit services to be provided by the independent
accountants to the Fund, and all non-audit services to be provided by the
independent accountants to the Fund&#146;s investment adviser and any entity
controlling, controlled by or under common control with the Funds&#146; investment
adviser (&#147;affiliates&#148;) that provide on-going services to each Fund, if the
engagement relates directly to the operations and financial reporting of each
Fund, or to establish detailed pre-approval policies and procedures for such
services in accordance with applicable laws. All of the audit and non-audit
services described above for which KPMG billed each Fund fees for the fiscal
years ended November 30, 2011 and November 30, 2012 were pre-approved by the
Audit Committee. </FONT></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
For each Fund&#146;s fiscal years ended November 30, 2011 and November 30, 2012, KPMG
did not provide any non-audit services (or bill any fees for such services) to
the Funds&#146; investment adviser or any affiliates.</FONT></P>
<P align=justify><B><FONT face="Times New Roman" size=2>Investment Adviser, Administrator
and Servicing Agent </FONT></B></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Flaherty &amp; Crumrine serves as the investment adviser to each Fund, and its
business address is 301 E. Colorado Boulevard, Suite 720, Pasadena, California
91101. BNY Mellon acts as the administrator to each Fund and is located at 4400
Computer Drive, Westborough, Massachusetts 01581. Destra Capital Investments LLC
acts as the servicing agent to FFC and FLC and is located at 901 Warrenville
Road, Suite 15, Lisle, IL 60532. </FONT></P>
<P align=justify><B><FONT face="Times New Roman" size=2>Compliance with the Securities
Exchange Act of 1934 </FONT></B></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Section 16(a) of the 1934 Act and Section 30(h) of the 1940 Act require each
Fund&#146;s Directors and executive officers, certain persons affiliated with
Flaherty &amp; Crumrine and persons who beneficially own more than 10% of a
registered class of each Fund&#146;s securities to file reports of ownership and
changes of ownership with the SEC, the NYSE and each Fund. Directors, officers
and greater-than-10% shareholders are required by SEC regulations to furnish
each Fund with copies of such forms they file. Based solely upon its review of
the copies of such forms received by it and written representations from certain
of such persons, each Fund believes that during 2012, all such filing
requirements applicable to such persons were met.</FONT></P>
<P align=justify><B><FONT face="Times New Roman" size=2>Broker Non-Votes and Abstentions
</FONT></B></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; A
proxy which is properly executed and returned accompanied by instructions to
withhold authority to vote represents a broker &#147;non-vote&#148; (i.e., shares held by
brokers or nominees as to which (i) instructions have not been received from the
beneficial owners or the persons entitled to vote and (ii) the broker or nominee
does not have discretionary voting power on a particular matter). Proxies that
reflect abstentions or broker non-votes (collectively, &#147;abstentions&#148;) will be
counted as Shares that are present and entitled to vote at the meeting for
purposes of determining the presence of a Quorum. With respect to Proposal 1,
abstentions do not constitute a vote &#147;for&#148; or &#147;against&#148; the proposal and will be
disregarded in determining the &#147;votes cast&#148; on the proposal. </FONT></P>
<P align=center><B><FONT face="Times New Roman" size=2>OTHER MATTERS TO COME BEFORE THE
MEETING</FONT></B></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Each Fund does not intend to present any other business at the relevant Meeting,
nor is any Fund aware that any shareholder intends to do so. If, however, any
other matters are properly brought before the Meeting, the persons named in the
accompanying form of proxy will vote thereon in accordance with their judgment.
</FONT></P>
<P STYLE="text-align: center"><B><FONT face="Times New Roman" size=2>VOTING RESULTS</FONT></B></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Each Fund will advise its shareholders of the voting results of the matters
voted upon at its Meeting in its next Semi-Annual Report to Shareholders.
</FONT></P>
<P align=center><FONT face="Times New Roman" size=2>13</FONT></P>
<HR align=center width="100%" noShade SIZE=2>

<DIV style="PAGE-BREAK-BEFORE: always"></DIV><BR>
<P align=center><B><FONT face="Times New Roman" size=2>NOTICE TO BANKS, BROKER/DEALERS AND
VOTING TRUSTEES AND THEIR NOMINEES</FONT></B></P>
<P align=justify><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Please advise the Funds whether other persons are the beneficial owners of Fund
Shares for which proxies are being solicited from you, and, if so, the number of
copies of the Joint Proxy Statement and other soliciting material you wish to
receive in order to supply copies to the beneficial owners of Fund Shares.
</FONT></P>
<P align=justify><B><FONT face="Times New Roman" size=2>IT IS IMPORTANT THAT PROXIES BE
RETURNED PROMPTLY. SHAREHOLDERS WHO DO NOT EXPECT TO ATTEND THE MEETINGS ARE
THEREFORE URGED TO COMPLETE, SIGN, DATE AND RETURN ALL PROXY CARDS AS SOON AS
POSSIBLE IN THE ENCLOSED POSTAGE-PAID ENVELOPE. </FONT></B></P>
<P align=center><FONT face="Times New Roman" size=2>14</FONT></P>
<HR align=center width="100%" noShade SIZE=2>
<DIV style="PAGE-BREAK-BEFORE: always"></DIV><BR>
<P align=justify><B><FONT face="Times New Roman">FLAHERTY &amp; CRUMRINE PREFERRED <BR>
INCOME OPPORTUNITY FUND<BR>
INCORPORATED<BR></FONT></B><B></B></P>
<P align=justify><B><I><FONT face="Times New Roman" size=2>Important Annual Meeting
Information<BR><BR><BR><BR><BR><BR><BR><BR><BR><BR></FONT></I></B></P>
<TABLE style="BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="30%" border=0>

  <TR vAlign=bottom>
    <TD NOWRAP STYLE="text-align: left; width: 98%; vertical-align: top"><FONT face="Times New Roman" size=1>Using a </FONT><B><U><FONT face="Times New Roman" size=1>black ink</FONT></U></B><FONT face="Times New Roman" size=1> pen, mark your votes with an X as shown
      in<BR>
this example. Please do not write outside the designated
    areas.</FONT></TD>
    <TD noWrap style="text-align: center" width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1pt solid; BORDER-TOP: #000000 1pt solid; BORDER-LEFT: #000000 1pt solid; BORDER-BOTTOM: #000000 1pt solid" noWrap align=right valign="middle" width="1%"><FONT face=Arial size=5><B>&nbsp;X&nbsp;</B></FONT></TD></TR></TABLE><BR>
<P align=justify><FONT face="Times New Roman">Annual Meeting Proxy Card</FONT></P>
<TABLE style="LINE-HEIGHT: 14pt; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=bottom>
    <TD noWrap style="text-align: center" width="100%"><FONT face="Times New Roman" size=1>PLEASE FOLD ALONG THE
      PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED
      ENVELOPE.</FONT></TD></TR>
  <TR>
    <TD style="BORDER-BOTTOM: #000000 1pt dashed; text-align: center" noWrap width="100%"><FONT size=1 face="Times New Roman">&nbsp;</FONT></TD></TR></TABLE><BR>
<P align=justify><B><FONT face="Times New Roman" size=2>A. Proposal - The Board of Directors
recommends a vote </FONT></B><B><U><FONT face="Times New Roman" size=2>FOR</FONT></U></B><B><FONT face="Times New Roman" size=2> the nominees
listed.</FONT></B></P>
<P align=justify>
<TABLE style="LINE-HEIGHT: 14pt; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"><FONT size=1 face="Times New Roman">1. Election
      of Directors:</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD noWrap align=left width="1%"><FONT size=1 face="Times New Roman">01 &#150; Donald
      F. Crumrine</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD noWrap align=left width="1%"><FONT face="Times New Roman" size=1>02 &#150; Robert F. Wulf </FONT></TD>
    <TD noWrap align=left width="95%">&nbsp;</TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%"><FONT face="Times New Roman" size=1></FONT></TD>
    <TD noWrap align=left width="95%"></TD></TR></TABLE></P>
<TABLE style="LINE-HEIGHT: normal; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=bottom>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" vAlign=top noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD vAlign=top noWrap align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom noWrap align=left width="10%"><FONT face="Times New Roman" size=1>Mark here to vote
      </FONT><B><U><FONT face="Times New Roman" size=1>FOR</FONT></U></B><FONT face="Times New Roman" size=1> all nominees</FONT></TD>
    <TD vAlign=bottom noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" vAlign=bottom noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD vAlign=bottom noWrap align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom noWrap align=left width="25%"><FONT face="Times New Roman" size=1>Mark here to
      </FONT><B><U><FONT face="Times New Roman" size=1>WITHHOLD</FONT></U></B><FONT face="Times New Roman" size=1> vote from all nominees</FONT></TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" vAlign=bottom align=left width="2%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD vAlign=bottom noWrap align=left width="1%"><FONT face="Times New Roman" size=1>For All
      </FONT><B><U><FONT face="Times New Roman" size=1>EXCEPT</FONT></U></B><FONT face="Times New Roman" size=1>- To withhold authority to vote
      for any</FONT></TD>
    <TD vAlign=top align=left width="54%">&nbsp;</TD></TR>
  <TR>
    <TD vAlign=top noWrap align=left width="1%"></TD>
    <TD vAlign=top noWrap align=left width="1%"></TD>
    <TD vAlign=bottom noWrap align=left width="10%"></TD>
    <TD vAlign=bottom noWrap align=left width="1%"></TD>
    <TD vAlign=bottom noWrap align=left width="1%"></TD>
    <TD vAlign=bottom noWrap align=left width="1%"></TD>
    <TD vAlign=bottom noWrap align=left width="25%"></TD>
    <TD vAlign=bottom align=left width="1%"></TD>
    <TD vAlign=bottom align=left width="2%"></TD>
    <TD vAlign=bottom align=left width="2%"></TD>
    <TD vAlign=bottom align=left width="1%"><FONT size=1 face="Times New Roman">nominee(s), write the name(s) of such
      nominee(s) below</FONT></TD>
    <TD vAlign=top align=left width="54%"></TD></TR>
  <TR vAlign=bottom>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="10%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="25%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="2%"></TD>
    <TD noWrap align=left width="2%"></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="1%"><FONT face="Times New Roman" size=1>&nbsp;</FONT>&nbsp;</TD>
    <TD noWrap align=left width="54%"></TD></TR></TABLE><BR>
<P align=justify><B><FONT face="Times New Roman" size=2><BR><BR><BR><BR><BR>B.</FONT></B><FONT face="Times New Roman" size=2> </FONT><B><FONT face="Times New Roman" size=2>Non-Voting Items</font></b>
<TABLE style="LINE-HEIGHT: 14pt; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=bottom>
    <TD noWrap align=left width="50%"><FONT size=1 face="Times New Roman"><STRONG>Change of Address</STRONG><FONT face="Times New Roman"> - Please print
      new address below.</FONT></FONT></TD>
    <TD noWrap align=left width="50%"><FONT size=1 face="Times New Roman"><STRONG>Comments</STRONG><FONT face="Times New Roman"> &#150; Please print your
      comments
below.&nbsp;</FONT></FONT>&nbsp;</TD></TR></TABLE><BR><BR><BR><BR><BR><B><FONT face="Times New Roman" size=2>C.</FONT></B><FONT face="Times New Roman" size=2> </FONT><B><FONT face="Times New Roman" size=2>Authorized Signatures &#150; This Section must be completed for
your vote to be counted. &#150; Date and Sign Below<BR></FONT></B><FONT face="Times New Roman" size=1>NOTE: Please sign this proxy exactly as your name(s) appear(s) on the
books of the Fund. Joint owners should each sign personally. Trustees and other
fiduciaries should indicate the capacity in which they sign, and where more than
one name appears, a majority must sign. If a corporation, the signature should
be that of an authorized officer who should state his or her title. </FONT></P>
<TABLE style="LINE-HEIGHT: 14pt; BORDER-COLLAPSE: collapse" cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=bottom>
    <TD noWrap align=left width="32%" colSpan=3><FONT face="Times New Roman" size=1>Date (mm/dd/yyyy) &#150;
      Please print date below.</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD noWrap align=left width="32%"><FONT face="Times New Roman" size=1>Signature 1 &#150; Please keep signature
      within the box.</FONT></TD>
    <TD noWrap align=left width="1%">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</TD>
    <TD noWrap align=left width="33%"><FONT face="Times New Roman" size=1>Signature 2 &#150; Please keep signature
      within the box.</FONT></TD></TR>
  <TR>
    <TD noWrap align=left width="32%" colSpan=3>&nbsp;</TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="32%"></TD>
    <TD noWrap align=left width="1%"></TD>
    <TD noWrap align=left width="33%"></TD></TR>
  <TR vAlign=bottom>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=right width="9%"><B><FONT face="Times New Roman" size=2>/</FONT></B></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=right width="1%"><B><FONT face="Times New Roman" size=2>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;/</FONT></B></TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=right width="22%">&nbsp;</TD>
    <TD noWrap align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="32%">&nbsp;</TD>
    <TD noWrap align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1pt solid" noWrap align=left width="33%"></TD></TR></TABLE><BR>
<HR align=center width="100%" noShade SIZE=2>

<DIV style="PAGE-BREAK-BEFORE: always"></DIV><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR>
<DIV align=center>
<TABLE cellSpacing=0 cellPadding=0 width="50%" border=0>

  <TR>
    <TD noWrap width="100%"><STRONG><FONT size=2 face="Times New Roman">The Notice of Annual Meeting
      of Shareholders, Joint Proxy Statement and proxy
card</FONT></STRONG></TD></TR>
  <TR>
    <TD noWrap width="100%"><STRONG><FONT size=2 face="Times New Roman">for the Fund
      are available on the Fund&#146;s website at www.preferredincome.com.</FONT></STRONG></TD></TR></TABLE></DIV><BR><BR><BR><BR><BR><BR><BR><BR><BR><BR>
<TABLE cellSpacing=0 width="100%" border=0>

  <TR>
    <TD style="text-align: center" width="100%"><FONT face="Times New Roman" size=1>PLEASE FOLD ALONG
      THE PERFORATION, DETACH AND RETURN THE BOTTOM PORTION IN THE ENCLOSED
      ENVELOPE.</FONT></TD></TR>
  <TR>
    <TD style="BORDER-BOTTOM: #000000 1pt dashed; text-align: center" width="100%"><STRONG><FONT size=2 face="Times New Roman">&nbsp;</FONT></STRONG></TD></TR></TABLE>
<BR>
<BR><BR>

<P STYLE="text-align: left"><B><FONT face="Times New Roman">Proxy - FLAHERTY &amp; CRUMRINE PREFERRED INCOME OPPORTUNITY FUND INCORPORATED</FONT></B></P>
<P STYLE="text-align: left"><B><FONT face="Times New Roman" size=2>PROXY IN CONNECTION WITH THE ANNUAL
MEETING OF SHAREHOLDERS TO BE HELD ON APRIL 18, 2013 </FONT></B></P><BR>

<P align=justify><B><FONT face="Times New Roman" size=2>Important Notice Regarding the
Availability of Proxy Materials for the Shareholder Meeting to be held on April
18, 2013. </FONT></B></P>
<P align=justify><B><FONT face="Times New Roman" size=2>The Notice of Annual Meeting of
Shareholders, Joint Proxy Statement and proxy card for the Fund are available on
the Fund&#146;s website at www.preferredincome.com. </FONT></B></P>
<P align=justify><FONT face="Times New Roman" size=2>PROXY SOLICITED BY BOARD OF
DIRECTORS</FONT></P>
<P align=justify><FONT face="Times New Roman" size=2>The undersigned holder of shares of
Common Stock of Flaherty &amp; Crumrine Preferred Income Opportunity Fund Incorporated, a
Maryland corporation (the &#147;Fund&#148;), hereby appoints Donald F. Crumrine, Robert M.
Ettinger and Chad C. Conwell, proxies for the undersigned, each with full powers
of substitution and revocation, to represent the undersigned and to vote on
behalf of the undersigned all shares of Common Stock which the undersigned is
entitled to vote at the Annual Meeting of Shareholders of the Fund to be held at
the offices of Flaherty &amp; Crumrine Incorporated, 301 East Colorado
Boulevard, Suite 720, Pasadena, California 91101 at 8:30 a.m. PT, on April 18,
2013, and any adjournments or postponements thereof. The undersigned hereby
acknowledges receipt of the Notice of Annual Meeting and Joint Proxy Statement
and hereby instructs said proxies to vote said shares as indicated hereon. In
their discretion, the proxies are authorized to vote upon such other business as
may properly come before the Meeting. A majority of the proxies present and
acting at the Meeting in person or by substitute (or, if only one shall be so
present, then that one) shall have and may exercise all of the power and
authority of said proxies hereunder. The undersigned hereby revokes any proxy
previously given.</FONT></P>
<HR align=center width="100%" noShade SIZE=2>

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end
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
