UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: 811-02281
THE HARTFORD INCOME SHARES FUND, INC.
(Exact name of registrant as specified in charter)
P. O. Box 2999, Hartford, Connecticut 06104-2999
(Address of Principal Executive Offices)
Edward P. Macdonald, Esquire
Life Law Unit
The Hartford Financial Services Group, Inc.
200 Hopmeadow Street
Simsbury, Connecticut 06089
(Name and Address of Agent for Service)
Registrant's telephone number, including area code: (860) 843-9934
Date of fiscal year end: July 31, 2005
Date of reporting period: August 1, 2004 - July 31, 2005
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. Section 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
[PICTURE]
JULY 31, 2005
THE HARTFORD
INCOME SHARES FUND, INC.
------------------------------
ANNUAL REPORT
[THE HARTFORD LOGO]
MUTUAL FUNDS
THE HARTFORD INCOME SHARES FUND, INC. ANNUAL REPORT
CONTENTS
MANAGER DISCUSSION 1
SCHEDULE OF INVESTMENTS 2
STATEMENT OF ASSETS AND
LIABILITIES 6
STATEMENT OF OPERATIONS 6
STATEMENTS OF CHANGES IN NET
ASSETS 7
NOTES TO FINANCIAL STATEMENTS 8
FINANCIAL HIGHLIGHTS 11
REPORT OF INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM 12
DIRECTORS AND OFFICERS 13
SHAREHOLDER MEETING RESULTS 15
IMPORTANT TAX INFORMATION 15
PRIVACY POLICY 16
- - TOLL-FREE PERSONAL ASSISTANCE
-Customer Service
-(888) 843-7824
- 7:00 a.m. to 6:00 p.m. CT,
Monday through Thursday
8:15 a.m. to 5:00 p.m. CT, Friday
- - TOLL-FREE INFORMATION LINE
- For daily account balances, transaction activity or net asset value
information
-(888) 843-7824 x14344
-24 hours a day
HOW TO USE THIS REPORT
For a quick overview of the fund's performance during the past twelve months,
refer to the Highlights box below. The letter from the portfolio manager
provides a more detailed analysis of the fund and financial markets.
The charts alongside the letter are useful because they provide more information
about your investments. The top holdings chart shows the types of securities in
which the fund invests, and the pie chart shows a breakdown of the fund's assets
by sector. Additional information concerning fund performance and policies can
be found in the Notes to Financial Statements.
This report is just one of several tools you can use to learn more about your
investment in The Hartford Income Shares Fund, Inc. Your investment
representative, who understands your personal financial situation, can best
explain the features of your investment and how it's designed to help you meet
your financial goals.
HIGHLIGHTS
<Table>
<Caption>
THE HARTFORD
INCOME SHARES FUND,
INC.
-------------------
JULY 31, 2005
TOTAL NET ASSETS (000'S OMITTED)................... $106,034
MARKET PRICE PER SHARE............................. $ 7.88
SHARES OUTSTANDING (000'S OMITTED)................. 12,989
FOR THE YEAR ENDED JULY 31, 2005:
NET ASSET VALUE PER SHARE:
Beginning of year................................ $ 7.93
End of year...................................... $ 8.16
DISTRIBUTIONS FROM NET INVESTMENT INCOME:
Total dividends paid (000's Omitted)............. $ 7,178
Dividends per share.............................. $ 0.55
</Table>
CERTIFICATIONS
In January 2005, the fund's principal executive officer submitted his annual
certification as to compliance with the New York Stock Exchange (NYSE) Corporate
Governance Listing Standards pursuant to Section 303A.12(a) of the NYSE Listed
Company Manual. The fund's principal executive and principal financial officer
certifications pursuant to Rule 30a-2 under the Investment Company Act of 1940
are filed with the fund's Form N-CSR filings and are available on the SEC's Web
site at http://www.sec.gov.
HOW TO OBTAIN A COPY OF THE FUND'S PROXY VOTING POLICIES AND PROXY VOTING RECORD
A description of the policies and procedures that the fund uses to determine how
to vote proxies relating to portfolio securities, and a record of how the fund
voted any proxies for the twelve month period ended June 30, 2005, is available
(1) without charge, upon request, by calling 1-888-843-7824 and (2) on the
Securities and Exchange Commission's website at http://www.sec.gov.
QUARTERLY PORTFOLIO HOLDINGS INFORMATION
The fund files a complete schedule of portfolio holdings with the Securities and
Exchange Commission for the first and third quarters of each fiscal year on Form
N-Q. The fund's Form N-Q will be available (1) without charge, upon request, by
calling 1-888-843-7824 and (2) on the Securities and Exchange Commission's
website at http://www.sec.gov. The Form N-Q may be reviewed and copied at the
Commission's Public Reference Room in Washington, DC. Information on the
operation of the Public Reference Room may be obtained by calling
1-800-SEC-0330.
THE HARTFORD INCOME SHARES FUND, INC.
(Subadvised by Hartford Investment Management Company)
Portfolio Manager
Mark Niland
PORTFOLIO COMPOSITION BY SECTOR AS
OF 7/31/2005
(PORTFOLIO COMPOSITION PIE CHART)
<Table>
Corporate Bonds - Investment Grade 70.5
Corporate Bonds - Non-Investment Grade 25.7
Cash Equivalents/Receivables 2.0
U.S. Government Agencies 0.6
Common Stock 0.7
Asset Backed and Commercial Mortgage 0.5
</Table>
TOP 10 HOLDINGS AS OF 7/31/2005
Percent of
Bonds Net Assets
- --------------------------------------------------------------------------------
1. General Motors Acceptance Corp.
(8.00%) 2031 5.2%
2. Ford Motor Co. (6.375%) 2029 4.5%
3. Farmers Exchange Capital (7.20%) 2048 3.0%
4. American Airlines, Inc. (7.86%) 2011 2.5%
5. Time Warner Entertainment Co. L.P.
(8.375%) 2033 2.2%
6. AT&T Corp. (9.75%) 2031 2.1%
7. Union Carbide Corp. (7.75%) 2096 2.0%
8. AT&T Wireless Services, Inc.
(8.75%) 2031 2.0%
9. News America Holdings, Inc.
(8.875%) 2023 1.8%
10. Tele-Communications, Inc. (9.80%) 2012 1.8%
WHAT DID THE MARKETS DO AND HOW DID THE FUND PERFORM?
The financial markets performed strongly over the 12-month period ended July 31,
2005. The S&P 500 Index, a common proxy for domestic equities, gained 14.05% and
the Lehman Aggregate Bond Index, a benchmark for domestic investment grade
bonds, gained 4.79%. Returning 10.46% at NAV and 15.42% at market price, The
Hartford Income Shares Fund, Inc. (the fund) doubled the performance of its bond
benchmark.
WHY DID THE FUND PERFORM THIS WAY?
During the last half of 2004 and the first half of the fund's fiscal reporting
period, the markets rallied as the U.S. economy showed increasing growth. These
conditions were beneficial for the fund's objectives. Given the fund's yield and
dividend payout orientation, its allocations to high yield and long investment
grade corporate bonds are quite substantial. As a result, the fund tends to lag
in periods where credit risk underperforms on an excess return basis
(particularly relative to funds that have significant Treasury and Mortgage
Backed Securities (MBS) exposure). Conversely, the fund tends to look much
better on a peer relative basis in credit rallies. Therefore, when credit
spreads narrowed and Moody's Investors Service, Inc.'s default rates and
downgrade-to-upgrade ratios declined below historical averages, the fund's
allocations to lower rated securities helped the fund to outperform its
investment grade benchmark by a substantial margin.
During the first quarter of 2005, the economic expansion continued at a strong
pace, as indicated by increases in consumer spending and business investment.
However, due to historically high energy prices and rising commodity costs,
there was concern that the economy may be losing some of its momentum. As part
of its plan to restrain inflation, the Federal Reserve (Fed) raised its target
Federal Funds rate twice in the first quarter. The combination of rising
short-term rates and high demand from overseas and pension funds for long-term
issues led to a flattening of the yield curve. The first quarter was challenging
for most fixed income market sectors. Both the fund and the Lehman Aggregate
Bond Index declined in the first quarter. During the second quarter of 2005, the
financial markets were more positive. Despite record high energy costs and
improving labor markets, investors became confident that the Fed could keep
inflation under control. Continuing its "measured pace" of tightening monetary
policy, the Fed raised rates two more times in the second quarter. Confidence
that inflation would be restrained was demonstrated by a general decline in
interest rates that resulted in a flattening of the yield curve. The high yield
sector rebounded later in the second quarter as the markets recovered from the
first quarter earnings disappointments and subsequent downgrades of Ford and
General Motors (GM). Both the fund and its benchmark provided solid gains for
the second quarter.
The fund's year-to-date relative performance was adversely affected by the
sell-off in the credit markets, which was triggered by the surprisingly low
earnings announcements by GM and Ford. The possibility of GM falling below
investment grade pressured its securities and led to concerns about the high
yield market's ability to absorb (in an orderly fashion) all of the debt that
would potentially fall into the high yield index. Therefore, the fund's large
relative weighting in Ford and GM were detrimental to short-term performance.
However, we remain confident that the positions that we own are not only
providing above market yields, but that there is also an asset value there that
more than fully supports our investment. With the uncertainty over Ford and GM's
ratings largely resolved, and more importantly their positions within the
broader market benchmarks also more concrete as of May, both the investment
grade and high yield markets staged significant rallies. The fund's long
duration position and yield curve positioning was a clear benefit as rates
declined in the second quarter due to the easing of inflation concerns. The fund
remained virtually out of the MBS and Treasury market due to the fact that
yields in these sectors are below the fund's current yield targets.
WHAT IS YOUR OUTLOOK?
Our outlook for U.S. corporate debt remains less favorable than in 2003 and
2004. This view reflects the continuing risk of monetary tightening by the Fed,
and the heightened risk of shareholder-friendly corporate activity that could
come at the expense of bondholders. That said, we continue to believe that the
earnings prospects for U.S. issuers remain generally supportive of their
underlying credit quality. The month of June represents the end of the second
full year that the fund has been able to payout a consistent monthly dividend.
In order to maintain the current dividend, our high yield allocation remains
high and its investment holdings are heavily concentrated in long duration
corporates that are generally at the lower-end of the investment grade spectrum.
In the event it becomes our view that the credit markets are heading for a major
downward correction, the current dividend level will be revisited.
The opinions about future economic and market developments expressed in this
report are those of the portfolio manager and are current only through the end
of the period of the report as stated on the cover. These views are subject to
change at any time based on market and other conditions, and no forecasts can be
guaranteed.
THE HARTFORD INCOME SHARES FUND, INC.
Schedule of Investments
July 31, 2005
(000's Omitted)
ASSET & COMMERCIAL MORTGAGE BACKED SECURITIES - 0.5%
- --------------------------------------------------------------------------------
<Table>
<Caption>
Principal Market
Amount Value #
- --------- --------
FINANCE - 0.3%
$ 339 AQ Finance CEB Trust, 8.46%, 8-25-2033 MQ................... $ 336
--------
TRANSPORTATION - 0.2%
277 Northwest Airlines, Inc., 6.81%, 2-1-2020................... 240
--------
TOTAL ASSET & COMMERCIAL MORTGAGE BACKED SECURITIES (COST
$588)....................................................... $ 576
========
</Table>
CORPORATE BONDS: INVESTMENT GRADE - 70.5%
- --------------------------------------------------------------------------------
<Table>
<Caption>
Principal Market
Amount Value #
- --------- --------
BASIC MATERIALS - 5.2%
$ 500 Newmont Mining Corp., 8.625%, 5-15-2011..................... $ 589
300 Olin Corp., 9.125%, 12-15-2011.............................. 356
685 Phelps Dodge Corp., 8.75%, 6-1-2011......................... 806
250 Phelps Dodge Corp., 9.50%, 6-1-2031......................... 365
2,000 Union Carbide Corp., 7.75%, 10-1-2096....................... 2,130
1,000 Westvaco Corp., 8.20%, 1-15-2030............................ 1,262
--------
5,508
--------
CAPITAL GOODS - 1.6%
170 Briggs & Stratton Corp., 8.875%, 3-15-2011.................. 196
1,250 Tyco International Group S.A., 7.00%, 6-15-2028............. 1,485
--------
1,681
--------
CONSUMER CYCLICAL - 4.1%
1,000 Albertson's, Inc., 8.70%, 5-1-2030.......................... 1,279
1,000 Federated Department Stores, Inc., 8.50%, 6-1-2010.......... 1,154
500 May Department Stores Co., 8.50%, 6-1-2019.................. 618
1,000 TRW, Inc., 7.75%, 6-1-2029.................................. 1,297
--------
4,348
--------
ENERGY - 7.1%
850 Burlington Resources, Inc., 9.125%, 10-1-2021............... 1,159
1,500 Columbia Energy Group, 7.62%, 11-28-2025.................... 1,563
1,000 ConocoPhillips Holding Co., 6.95%, 4-15-2029................ 1,226
750 Halliburton Co., 5.625%, 12-1-2008.......................... 772
1,000 Occidental Petroleum Corp., 8.45%, 2-15-2029................ 1,416
1,000 Valero Energy Corp., 8.75%, 6-15-2030....................... 1,350
--------
7,486
--------
FINANCE - 21.0%
1,000 CNA Financial Corp., 7.25%, 11-15-2023...................... 1,084
1,000 EOP Operating L.P., 7.50%, 4-19-2029........................ 1,167
1,000 ERAC USA Finance Co., 8.00%, 1-15-2011 M.................... 1,136
3,000 Farmers Exchange Capital, 7.20%, 7-15-2048 M................ 3,157
6,250 Ford Motor Co., 6.375%, 2-1-2029............................ 4,821
5,650 General Motors Acceptance Corp., 8.00%, 11-1-2031........... 5,481
500 Household Finance Corp., 7.00%, 5-15-2012................... 557
250 Liberty Mutual Group, 7.00%, 3-15-2034 M.................... 256
1,000 Mony Group, Inc., 8.35%, 3-15-2010.......................... 1,137
1,000 ReliaStar Financial Corp., 8.00%, 10-30-2006................ 1,039
1,000 Spieker Properties, Inc., 7.50%, 10-1-2027.................. 1,169
1,000 Travelers Property Casualty Corp., 7.75%, 4-15-2026......... 1,217
--------
22,221
--------
SERVICES - 11.8%
1,000 Belo Corp., 7.25%, 9-15-2027................................ 1,066
750 Clear Channel Communications, Inc., 7.65%, 9-15-2010........ 801
1,000 Comcast Cable Communications, Inc., 8.50%, 5-1-2027......... 1,308
1,000 Cox Enterprises, Inc., 8.00%, 2-15-2007 M................... 1,047
750 Electronic Data Systems Corp., 7.45%, 10-15-2029............ 787
1,000 FedEx Corp., 7.84%, 1-30-2018............................... 1,178
1,000 Hearst-Argyle Television, Inc., 7.00%, 1-15-2018............ 1,074
750 Hilton Hotels Corp., 8.25%, 2-15-2011....................... 855
1,500 News America Holdings, Inc., 8.875%, 4-26-2023.............. 1,952
1,250 Park Place Entertainment Corp., 8.50%, 11-15-2006........... 1,312
500 USA Networks, Inc., 6.75%, 11-15-2005....................... 503
500 USA Waste Management, Inc., 7.125%, 12-15-2017.............. 568
--------
12,451
--------
TECHNOLOGY - 11.6%
1,500 AT&T Wireless Services, Inc., 8.75%, 3-1-2031............... 2,072
1,500 Cox Communications, Inc., 6.80%, 8-1-2028................... 1,623
1,000 Raytheon Co., 7.20%, 8-15-2027.............................. 1,216
250 Sprint Capital Corp., 6.00%, 1-15-2007...................... 255
1,500 Sprint Capital Corp., 6.875%, 11-15-2028.................... 1,695
1,500 Tele-Communications, Inc., 9.80%, 2-1-2012.................. 1,872
</Table>
2
The accompanying notes are an integral part of this financial statement.
CORPORATE BONDS: INVESTMENT GRADE - CONTINUED
- --------------------------------------------------------------------------------
<Table>
<Caption>
Principal Market
Amount Value #
- --------- --------
$ 400 TELUS Corp., 8.00%, 6-1-2011................................ $ 462
700 Time Warner Companies, Inc., 6.625%, 5-15-2029.............. 768
1,800 Time Warner Entertainment Co. L.P., 8.375%, 7-15-2033....... 2,360
--------
12,323
--------
TRANSPORTATION - 4.5%
2,500 American Airlines, Inc., 7.86%, 10-1-2011................... 2,667
1,000 Continental Airlines, Inc., 7.92%, 5-1-2010................. 1,025
1,000 Norfolk Southern Corp., 8.625%, 5-15-2010................... 1,154
--------
4,846
--------
UTILITIES - 3.6%
419 American Electric Power Co., Inc., 6.125%, 5-15-2006........ 424
1,000 CMS Panhandle Holding Co., 7.00%, 7-15-2029................. 1,168
750 FirstEnergy Corp., 6.45%, 11-15-2011........................ 807
1,400 TXU Corp., 6.375%, 6-15-2006................................ 1,421
--------
3,820
--------
TOTAL CORPORATE BONDS: INVESTMENT GRADE (COST $61,574)...... $ 74,684
========
</Table>
CORPORATE BONDS: NON-INVESTMENT GRADE - 25.7%
- --------------------------------------------------------------------------------
<Table>
<Caption>
Principal Market
Amount Value #
- --------- --------
BASIC MATERIALS - 2.9%
$1,000 Abitibi-Consolidated, Inc., 8.85%, 8-1-2030................. $ 975
750 Equistar Chemicals L.P., 10.125%, 9-1-2008.................. 825
500 Hercules, Inc., 11.125%, 11-15-2007......................... 565
235 Nova Chemicals Corp., 7.00%, 5-15-2006...................... 238
250 Stone Container Corp., 9.75%, 2-1-2011...................... 263
163 United States Steel Corp., 10.75%, 8-1-2008................. 183
--------
3,049
--------
CAPITAL GOODS - 1.7%
525 Bombardier, Inc., 6.75%, 5-1-2012 M......................... 512
1,250 Bombardier, Inc., 7.45%, 5-1-2034 M......................... 1,088
200 Jorgensen (Earle M.) Co., 9.75%, 6-1-2012................... 217
--------
1,817
--------
CONSUMER CYCLICAL - 1.8%
500 Delhaize America, Inc., 9.00%, 4-15-2031.................... 624
120 Dillard's, Inc., 6.625%, 1-15-2018.......................... 113
85 Dillard's, Inc., 7.13%, 8-1-2018............................ 83
225 Navistar International Corp., 9.375%, 6-1-2006.............. 232
1,000 Toys R Us, Inc., 7.375%, 10-15-2018......................... 808
--------
1,860
--------
ENERGY - 0.5%
500 Williams Companies, Inc., 7.125%, 9-1-2011.................. 545
--------
FINANCE - 0.8%
100 IPC Acquisition Corp., 11.50%, 12-15-2009................... 108
750 Qwest Capital Funding, Inc., 6.50%, 11-15-2018.............. 619
115 Western Financial Bank, 9.625%, 5-15-2012................... 125
--------
852
--------
HEALTH CARE - 0.2%
150 United Surgical Partners International, Inc., 10.00%,
12-15-2011.................................................. 165
--------
SERVICES - 3.7%
1,000 Liberty Media Corp., 8.5%, 07-15-2029....................... 1,020
250 Mandalay Resort Group, 7.625%, 7-15-2013.................... 265
1,000 MGM Mirage, Inc., 8.50%, 9-15-2010.......................... 1,103
750 Service Corp. International, 6.50%, 3-15-2008............... 769
750 Starwood Hotels & Resorts Worldwide, Inc., 7.375%,
5-1-2007.................................................... 780
--------
3,937
--------
TECHNOLOGY - 9.6%
1,750 AT&T Corp., 9.75%, 11-15-2031............................... 2,266
675 Charter Communications Holdings LLC, 10.00%, 5-15-2011...... 528
260 Charter Communications Holdings LLC, 8.25%, 4-1-2007........ 261
500 Citizens Communications Co., 9.00%, 8-15-2031............... 528
750 Dobson Communications Corp., 10.875%, 7-1-2010.............. 784
250 Level 3 Communications, Inc., 11.00%, 3-15-2008............. 220
595 Level 3 Communications, Inc., 11.25%, 3-15-2010............. 461
145 Level 3 Communications, Inc., 9.125%, 5-1-2008.............. 119
</Table>
3
The accompanying notes are an integral part of this financial statement.
THE HARTFORD INCOME SHARES FUND, INC.
Schedule of Investments
July 31, 2005
(000's Omitted)
CORPORATE BONDS: NON-INVESTMENT GRADE - CONTINUED
- --------------------------------------------------------------------------------
<Table>
<Caption>
Principal Market
Amount Value #
- --------- --------
$1,500 Lucent Technologies, Inc., 6.45%, 3-15-2029................. $ 1,350
99 MCI, Inc., 6.91%, 5-1-2007.................................. 100
99 MCI, Inc., 7.69%, 5-1-2009.................................. 103
85 MCI, Inc., 8.735%, 5-1-2014................................. 96
650 Nortel Networks Corp., 6.875%, 9-1-2023..................... 619
650 Nortel Networks Ltd., 6.125%, 2-15-2006..................... 652
100 PanAmSat Corp., 6.875%, 1-15-2028........................... 95
100 Qwest Corp., 6.875%, 9-15-2033.............................. 87
270 Rogers Cable, Inc., 6.25%, 6-15-2013........................ 271
500 Rogers Cable, Inc., 8.75%, 5-1-2032......................... 580
1,000 Rogers Wireless, Inc., 9.75%, 6-1-2016...................... 1,215
--------
10,335
--------
TRANSPORTATION - 1.5%
170 CP Ships Ltd., 10.375%, 7-15-2012........................... 191
1,200 Delta Air Lines, Inc., 10.50%, 4-30-2016 V.................. 575
500 Delta Air Lines, Inc., 7.57%, 5-18-2012..................... 465
500 NWA Trust, 13.875%, 6-21-2008 V............................. 335
--------
1,566
--------
UTILITIES - 3.0%
115 Calpine Corp., 7.875%, 4-1-2008............................. 81
310 Calpine Corp., 8.50%, 2-15-2011............................. 215
1,000 El Paso Corp., 8.05%, 10-15-2030............................ 1,025
720 Sierra Pacific Power Co., 8.00%, 6-1-2008................... 770
1,000 TECO Energy, Inc., 7.20%, 5-1-2011.......................... 1,085
--------
3,176
--------
TOTAL CORPORATE BONDS: NON-INVESTMENT GRADE (COST
$27,130).................................................... $ 27,302
========
</Table>
U.S. GOVERNMENT AGENCIES - 0.6%
- --------------------------------------------------------------------------------
<Table>
<Caption>
Principal Market
Amount Value #
- --------- --------
FEDERAL HOME LOAN MORTGAGE CORPORATION - 0.1%
$ 14 9.00% 2022.................................................. $ 15
37 10.50% 2017................................................. 42
18 11.25% 2010................................................. 20
12 11.50% 2015................................................. 14
31 11.75% 2010................................................. 34
--------
125
--------
FEDERAL NATIONAL MORTGAGE ASSOCIATION - 0.3%
105 8.00% 2024-2025............................................. 113
72 10.50% 2017-2020............................................ 81
71 11.00% 2011-2018............................................ 78
16 12.00% 2014................................................. 17
25 12.50% 2015................................................. 28
--------
317
--------
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION - 0.2%
99 9.00% 2021.................................................. 109
77 9.50% 2020.................................................. 86
--------
195
--------
TOTAL U.S. GOVERNMENT AGENCIES (COST $594).................. $ 637
========
</Table>
COMMON STOCK - 0.7%
- --------------------------------------------------------------------------------
<Table>
<Caption>
Market
Shares Value #
- ------ --------
CONSUMER CYCLICAL - 0.0%
1 Hosiery Corp. of America, Inc. Class A -- V................ $ @@
--------
TECHNOLOGY - 0.7%
2 Global Crossing Ltd. -- ................................... 28
13 MCI, Inc.................................................... 329
7 McLeod USA, Inc. (Warrants) V -- ........................... @@
5 NTL, Inc. -- .............................................. 335
--------
TOTAL COMMON STOCK (COST $381).............................. $ 692
--------
TOTAL INVESTMENTS IN SECURITIES (COST $90,267) O............ $103,891
========
</Table>
4
The accompanying notes are an integral part of this financial statement.
- --------------------------------------------------------------------------------
Note: Percentage of investments as shown is the ratio of the total market value
to total net assets.
Market value of investments in foreign securities represents 6.44% of total
net assets at July 31, 2005.
The aggregate value of securities valued in good faith at fair value by, or
under the direction of, the Fund's Board of Directors at July 31, 2005, was
$ @@, which represents 0.00% of total net assets.
<Table>
-- Currently non-income producing. For long-term debt
securities, items identified are in default as to payment of
interest and/or principal.
O At July 31, 2005, the cost of securities for federal income
tax purposes is $90,325 and the aggregate gross unrealized
appreciation and depreciation based on that cost was:
</Table>
<Table>
Unrealized appreciation..................................... $15,309
Unrealized depreciation..................................... (1,743)
-------
Net unrealized appreciation................................. $13,566
-------
</Table>
<Table>
# See Note 2b of accompanying Notes to Financial Statements
regarding valuation of securities.
</Table>
<Table>
V The following securities are considered illiquid. Securities
identified below as 144A are securities issued within terms
of a private placement memorandum, exempt from registration
under Section 144A of the Securities Act of 1933, as
amended, and may be sold only to dealers in that program or
to qualified institutional buyers (as defined under Section
144A of the Securities Act of 1933).
</Table>
<Table>
<Caption>
PERIOD ACQUIRED SHARES/PAR SECURITY COST BASIS
- --------------- ---------- -------- ----------
1996 $1,200 Delta Air Lines, Inc. due 2016.............................. $1,394
1994 1 Hosiery Corp. of America, Inc. Class A -- 144A.............. 8
2002 7 McLeod USA (Warrants)....................................... 4
1995 $ 500 NWA Trust due 2008.......................................... 500
</Table>
<Table>
The aggregate value of these securities at July 31, 2005 was
$910, which represents 0.86% of total net assets.
M Securities issued within terms of a private placement
memorandum, exempt from registration under Section 144A of
the Securities Act of 1933, as amended, and may be sold only
to dealers in that program or to other qualified
institutional buyers (as defined under Section 144A of the
Securities Act of 1933). Pursuant to guidelines adopted by
the Board of Directors, these issues are determined to be
liquid. The aggregate value of these securities at July 31,
2005, was $7,532, which represents 7.10% of total net
assets.
Q Variable rate securities; the yield reported is the rate in
effect at July 31, 2005.
@@ Due to the presentation of the financial statements in
thousands, the number of shares and/or dollars round to
zero.
</Table>
(UNAUDITED)
DISTRIBUTION BY CREDIT QUALITY
AS OF JULY 31, 2005
<Table>
<Caption>
RATING PERCENTAGE OF HOLDINGS*
- -----------------------------------------------------
AAA 0.6%
A 5.7%
BBB 65.3%
BB 16.6%
B 4.8%
CCC 2.3%
CC 0.8%
NR 1.2%
- -----------------------------------------------------
TOTAL 97.3%
- -----------------------------------------------------
</Table>
* Per the prospectus, split rated bonds are categorized using the highest
rating.
5
The accompanying notes are an integral part of this financial statement.
THE HARTFORD INCOME SHARES FUND, INC.
Statement of Assets and Liabilities
July 31, 2005
(000's Omitted)
- --------------------------------------------------------------------------------
<Table>
ASSETS
Investments in securities, as detailed in the accompanying
schedule, at market (cost $90,267) (Note 2)............. $103,891
Cash on deposit with custodian............................ 725
Receivables:
Investment securities sold.............................. 5
Interest and dividends.................................. 2,070
Other receivables....................................... 4
--------
TOTAL ASSETS................................................ 106,695
--------
LIABILITIES
Dividend payable ($0.046 per share)....................... 597
Payable for investment advisory and management fees (Note
3)...................................................... 9
Accounts payable and accrued expenses..................... 55
--------
TOTAL LIABILITIES........................................... 661
--------
NET ASSETS.................................................. $106,034
========
COMPOSITION OF NET ASSETS
Net proceeds of capital stock, par value $.01 per
share-authorized 15,000 shares; 12,989 shares
outstanding............................................. $117,743
Unrealized appreciation of investments.................... 13,624
Distributions in excess of net investment income.......... (21)
Accumulated net realized loss from sale of investments.... (25,312)
--------
TOTAL NET ASSETS............................................ $106,034
========
NET ASSET VALUE PER SHARE................................... $ 8.16
========
</Table>
THE HARTFORD INCOME SHARES FUND, INC.
Statement of Operations
For the year ended July 31, 2005
(000's Omitted)
- --------------------------------------------------------------------------------
<Table>
NET INVESTMENT INCOME:
Interest income........................................... $ 8,114
-------
EXPENSES:
Investment advisory and management fees (Note 3).......... 636
Legal and auditing fees................................... 62
Custodian fees............................................ 7
Shareholders' notices and reports......................... 57
Directors' fees and expenses.............................. 2
Exchange listing fees..................................... 25
Other..................................................... 15
-------
Total expenses............................................ 804
-------
Fees paid indirectly (Note 3)............................. (7)
-------
Total net expenses........................................ 797
-------
NET INVESTMENT INCOME....................................... 7,317
-------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized loss on investments.......................... (396)
Net change in unrealized appreciation of investments...... 3,275
-------
NET GAIN ON INVESTMENTS..................................... 2,879
-------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ $10,196
=======
</Table>
The accompanying notes are an integral part of this financial statement.
6
THE HARTFORD INCOME SHARES FUND, INC.
Statements of Changes in Net Assets
(000's Omitted)
- --------------------------------------------------------------------------------
<Table>
<Caption>
For the Year Ended For the Year Ended
July 31, 2005 July 31, 2004
------------------ ------------------
OPERATIONS:
Net investment income..................................... $ 7,317 $ 7,387
Net realized loss on investments.......................... (396) (1,738)
Net change in unrealized appreciation of investments...... 3,275 5,413
-------- --------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........ 10,196 11,062
-------- --------
DISTRIBUTIONS TO SHAREHOLDERS:
From net investment income................................ (7,178) (7,173)
-------- --------
CAPITAL SHARE TRANSACTIONS:
Proceeds from 3 and 7 shares issued as a result of
reinvested dividends, respectively...................... 23 59
-------- --------
TOTAL INCREASE IN NET ASSETS................................ 3,041 3,948
NET ASSETS:
Beginning of year......................................... 102,993 99,045
-------- --------
End of year............................................... $106,034 $102,993
======== ========
Distributions in excess of net investment income............ $ (21) $ (160)
======== ========
</Table>
The accompanying notes are an integral part of this financial statement.
7
THE HARTFORD INCOME SHARES FUND, INC.
Notes to Financial Statements
July 31, 2005
($000's Omitted)
- --------------------------------------------------------------------------------
1. ORGANIZATION: The Hartford Income Shares Fund, Inc., ("the fund") is a
closed-end diversified management investment company. The primary investment
objective of the fund is to seek a high level of current income through
investment in a diversified portfolio of debt securities, some of which may
be privately placed and some of which may have equity features. Capital
appreciation is a secondary objective.
INDEMNIFICATIONS: Under the fund's organizational documents, its directors and
officers are indemnified against certain liabilities arising out of the
performance of their duties to the fund.
In addition, the fund enters into contracts that contain a variety of
indemnifications. The fund's maximum exposure under these contracts is
unknown. However, the fund has not had any prior claims or losses pursuant to
these contracts and expects the risk of loss to be remote.
2. SIGNIFICANT ACCOUNTING POLICIES: The following is a summary of significant
accounting policies of the fund, which are in accordance with U. S. generally
accepted accounting principles:
(a) SECURITY TRANSACTIONS AND RELATED INVESTMENT INCOME -- Security
transactions are recorded on the trade date. Interest income, including
level-yield amortization of premium and discount, is recorded on the accrual
basis. Realized security gains and losses are determined using the identified
cost method. For the year ended July 31, 2005, the cost of purchases and
proceeds from sales of securities (other than short-term securities) were as
follows:
<Table>
Cost of purchases excluding U.S. Government
obligations: $15,377
Sales proceeds excluding U.S. Government
obligations: $13,843
Cost of purchases for U.S. Government
obligations: $ 2,474
Sales proceeds for U.S. Government obligations: $ 3,658
</Table>
(b) SECURITY VALUATION -- Debt securities (other than short-term obligations)
held by the fund are valued on the basis of valuations furnished by an
unaffiliated pricing service which determines valuations for normal
institutional size trading units of debt securities. Securities for which
prices are not available from an independent pricing service, but where an
active market exists, are valued using market quotations obtained from one or
more dealers that make markets in the securities or from an approved quotation
system in accordance with procedures established by the fund's Board of
Directors. Short term investments with a maturity of more than 60 days when
purchased are valued based on market quotations until the remaining days to
maturity become less than 61 days. Short term investments with a maturity of
60 days or less are valued at amortized cost.
Equity securities are valued at the last sales price or official closing price
reported on the principal securities exchange on which such securities are
traded (domestic or foreign) or on the principal over-the counter market on
which such securities are traded, as of the close of business on the day the
securities are being valued. If no sale took place on a particular day, then
such securities are valued at the mean between the bid and asked prices. For
securities traded on the NASDAQ National Market System, the fund utilizes the
NASDAQ Official Closing Price, which compares the last trade to the bid/ask
range of a security. If the last trade falls within the bid/ask range, then
that price will be the closing price. If the last trade is outside the bid/ask
range and falls above the ask, the ask will be the closing price. If the last
price is below the bid, the bid will be the closing price. The difference
between cost and market value for debt and equity securities is recorded on
the Statement of Operations and accumulated in net assets.
The fund generally uses market prices in valuing portfolio securities.
Securities of foreign issuers and non-dollar securities are valued on the
basis of quotations from the primary market in which they are traded, and are
translated from the local currency into U.S. dollars using prevailing exchange
rates. If market quotations are not readily available or are deemed
unreliable, the fund will use the fair value of the security as determined in
good faith under policies and procedures established by and under the
supervision of the fund's Board of Directors. Market prices may be deemed
unreliable, for example, if a security is thinly traded or if an event has
occurred after the close of the exchange on which a portfolio security is
principally traded but before the close of the NYSE that is expected to affect
the value of the portfolio security. The circumstances in which the fund may
use fair value pricing include, among others: (i) the occurrence of events
that are significant to a particular issuer, such as mergers, restructuring or
defaults; (ii) the occurrence of events that are significant to an entire
market, such as natural disasters in a particular region or governmental
actions; (iii) trading restrictions on securities; (iv) thinly traded
securities; and (v) market events such as trading halts and early market
closings. In addition, with respect to the valuation of securities principally
traded on foreign markets, the fund, uses a fair value pricing service
approved by the fund's Board, which employs quantitative models to adjust for
"stale" prices caused by the movement of other markets and other factors
occurring after the close of the foreign exchanges but before the close of the
NYSE. Securities that are principally traded on foreign markets may trade on
days that are not business days of the fund. Because the NAV of the fund's
shares is determined only on business days of the fund, the value of the
portfolio securities of the fund that invests in foreign securities may change
on days when a shareholder will not be able to trade shares. Fair value
pricing is subjective in nature and the use of fair value pricing by the fund
may cause the net asset value of its shares to differ significantly from the
net asset value that would be calculated using prevailing market values. There
can be no assurance that the fund could obtain the fair value assigned to a
security if it were to sell the security at approximately the time at which
the fund determines its NAV per share.
Securities for which prices are not available from an independent pricing
service, but where an active market exists, are valued using market quotations
obtained from one or more dealers that make markets in the securities or from
an approved quotation system in accordance with procedures established by the
fund's Board of Directors.
(c) REPURCHASE AGREEMENTS -- A repurchase agreement is an agreement by which
the seller of a security agrees to repurchase the security sold at a mutually
agreed upon time and price. At the time the fund enters into a repurchase
agreement, the value of the underlying collateral security(ies), including
accrued interest, will be equal to or exceed the value of the repurchase
agreement. Securities that serve to collateralize the repurchase agreement are
held by the fund's custodian in book entry form in the custodial account of
the fund. Repurchase agreements are valued at cost plus accrued interest
receivable. All repurchase agreements are executed through the fund's
custodian in book entry or physical form in the custodial account of the fund.
As of July 31, 2005, there were no outstanding repurchase agreements.
(d) CREDIT RISK -- Credit risk depends largely on the perceived financial
health of bond issuers. In general, lower rated bonds have higher credit
risks. High yield bond prices can fall on bad news about the economy, an
industry or a company. Share
8
THE HARTFORD INCOME SHARES FUND, INC.
Notes to Financial Statements
July 31, 2005
($000's Omitted)
- --------------------------------------------------------------------------------
price, yield and total return may fluctuate more than with less aggressive
bond funds.
(e) SECURITIES PURCHASED ON A WHEN-ISSUED BASIS -- Delivery and payment for
securities that have been purchased by the fund on a forward commitment or
when-issued basis can take place a month or more after the transaction date.
During this period, such securities are subject to market fluctuations and the
fund maintains, in a segregated account with its custodian, assets with a
market value equal to the amount of its purchase commitments. As of July 31,
2005, there were no outstanding when-issued or forward commitments.
(f) FEDERAL INCOME TAXES -- For federal income tax purposes, the fund intends
to continue to qualify as a regulated investment company under Subchapter M of
the Internal Revenue Code by distributing substantially all of its taxable net
investment income and net realized capital gains to its shareholders and
otherwise complying with the requirements of regulated investment companies.
Accordingly, no provision for federal income taxes has been made in the
accompanying financial statements. On a calendar year basis, the fund is
subject to a 4% federal excise tax to the extent it does not distribute
substantially all of its net investment income and realized gains, if any.
Net investment income and net realized gains differ for financial statement
and tax purposes. The character of distributions made during the year from net
investment income or net realized gains may therefore differ from their
ultimate characterization for federal income tax purposes. Also, due to the
timing of dividend distributions, the fiscal year in which amounts are
distributed may differ from the year that the income or realized gains
(losses) were recorded by the fund.
On the Statement of Assets and Liabilities, as a result of permanent
book-to-tax differences mainly attributable to expiration of capital loss
carryovers, paid-in-capital and accumulated net realized loss have been
decreased by $304. This reclassification did not have any impact on net assets
or net asset value per share.
The tax character of distributions paid for the years ended July 31, 2005 and
2004, was ordinary income in the amounts of $7,178 and $7,173, respectively.
As of July 31, 2005 the components of accumulated loss on a tax basis are as
follows:
<Table>
<Caption>
July 31,
2005
--------
Undistributed ordinary income................. $ 576
Accumulated loss.............................. (25,254)
Unrealized appreciation....................... 13,566
--------
Total accumulated loss........................ $(11,112)
--------
</Table>
The difference between book-basis and tax-basis unrealized appreciation is
attributable to tax deferral of wash sales.
For federal income tax purposes, the fund had capital loss carryovers of
$24,684 at July 31, 2005, which, if not offset by subsequent capital gains,
will expire in 2007 through 2013 as follows:
<Table>
<Caption>
Carryover Year Expires
--------- ------------
$ 993...................................... 2007
5,416...................................... 2008
5,061...................................... 2009
4,710...................................... 2010
1,710...................................... 2011
5,026...................................... 2012
1,768...................................... 2013
</Table>
For federal income tax purposes, the fund elected to defer its realized
capital losses for the period subsequent to October 31 in the amount of $570.
These losses will be recognized on the first day of the next fiscal year.
(g) RESTRICTED SECURITIES -- At July 31, 2005, investments in securities for
the fund included issues that are illiquid. The fund currently limits
investments in illiquid securities to 15% of net assets, at market value, at
the date of purchase. The aggregate value of such securities at July 31, 2005,
was $910, which represents 0.86% of net assets. Pursuant to guidelines adopted
by the Board of Directors, certain unregistered securities are determined to
be liquid and are not included in the 15% limitation specified above.
(h) DIVIDEND REINVESTMENT PLAN -- The fund intends to distribute income
dividends on a monthly basis and capital gains on an annual basis, if any. A
shareholder may choose to have his or her dividends and capital gains
distributions reinvested in additional whole or fractional shares of the fund.
Although reinvested, this distribution will still be taxable. Under this plan,
when the market price is greater than the net asset value, the reinvestment
price will be the greater of 95 percent of the month-end market price (plus
brokerage commissions) or the month-end net asset value. When the market price
is less than the net asset value, the reinvestment price will be the market
price (plus brokerage commissions) to the extent that shares can be purchased
in the open market.
Shareholders will automatically receive their dividends and capital gains
distributions in cash, unless they inform the fund in writing that they desire
to have their distributions reinvested in additional shares. This may be done
by contacting Hartford Administrative Services Company (See page 14). Notice
to initiate or to terminate this plan must be received by Hartford
Administrative Services Company 15 days prior to the dividend date for which
the change is to become effective.
(i) USE OF ESTIMATES -- The preparation of financial statements in conformity
with U.S. generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities as of the date of the financial statements and the reported
amounts of income and expenses during the period. Operating results in the
future could vary from the amounts derived from management's estimates.
3. EXPENSES:
(a) PAYMENTS TO RELATED PARTIES -- Hartford Investment Financial Services,
LLC ("HIFSCO") is the investment adviser for the fund. Investment advisory
and management fees are computed at the annual rate of 0.45% for the first
$100 million of average monthly net assets and at the annual rate of 0.40% of
average monthly net assets over $100 million, plus 2% of investment income.
9
THE HARTFORD INCOME SHARES FUND, INC.
Notes to Financial Statements
July 31, 2005
($000's Omitted)
- --------------------------------------------------------------------------------
As adviser for the fund, HIFSCO has contracted Hartford Investment Management
Company ("Hartford Investment") to provide investment advice and, in general,
to conduct the management investment program of the fund, subject to the
general control of HIFSCO and the fund's Board of Directors. Pursuant to the
sub-advisory agreement, Hartford Investment will regularly provide the fund
with investment research, advice and supervision and furnish an investment
program consistent with the fund's investment objectives and policies,
including the purchase, retention and disposition of securities.
The Hartford Financial Services Group, Inc. ("The Hartford") and its
subsidiaries provide facilities and office equipment and perform certain
services for the fund, including fund accounting and financial reporting.
Certain officers of the fund are directors and/or officers of HIFSCO, Hartford
Investment and/or The Hartford or its subsidiaries. No officer of the fund
receives any compensation directly from the fund. Hartford Administrative
Services Company ("HASCO"), a wholly owned subsidiary of The Hartford,
provides transfer agent services to the fund.
(b) EXPENSE OFFSET -- The fund's custodian bank has agreed to reduce its fees
when the fund maintains cash on deposit in the non-interest-bearing custody
account. For the year ended July 31, 2005, the custodian fee offset
arrangement reduced expenses by $7. The total expense reduction represents an
effective annual rate of 0.007% of the fund's average total net assets. This
amount is included on the fees paid indirectly line of the Statement of
Operations.
(c) OTHER RELATED PARTY TRANSACTIONS -- For the year ended July 31, 2005,
Hartford Fire Insurance Company was reimbursed $@@ for legal expenses on
behalf of the fund.
@@ Due to the presentation of the financial statements in thousands, the
dollars round to zero.
10
THE HARTFORD INCOME SHARES FUND, INC.
Financial Highlights
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS: Selected per share historical data was as follows:
<Table>
<Caption>
-------- Year Ended July 31,
----------------------------------------------------------
2005 2004 2003 2002 2001@@@
- ------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of year.......................... $ 7.93 $ 7.63 $ 6.66 $ 7.95 $ 8.17
Operations:
Net investment income..................................... .56 .56 .58 .64 .67
Net realized and unrealized gain (loss) on investments.... .22 .29 .99 (1.29) (.20)
-------- -------- ------- ------- --------
Total from operations....................................... .78 .85 1.57 (.65) .47
-------- -------- ------- ------- --------
Distributions to shareholders:
From net investment income.................................. (.55) (.55) (.60) (.64) (.69)
-------- -------- ------- ------- --------
Net asset value, end of year................................ $ 8.16 $ 7.93 $ 7.63 $ 6.66 $ 7.95
-------- -------- ------- ------- --------
Per share market value, end of year......................... $ 7.88 $ 7.33 $ 6.99 $ 6.80 $ 7.94
Total investment return, market value @..................... 15.42% 12.75% 11.63% (6.72%) 13.55%
Total investment return, net asset value @@................. 10.46% 11.69% 24.36% (8.75%) 6.18%
Net Assets end of year (000s omitted)....................... $106,034 $102,993 $99,045 $85,772 $101,319
Ratio of gross expenses to average monthly net assets....... .76% .82% .86% .80% .77%
Ratio of net expenses (includes fees paid indirectly) to
average monthly net assets................................ .75% .82% .86% .80% .77%
Ratio of net investment income to average monthly net
assets.................................................... 6.89% 7.05% 7.93% 8.45% 8.38%
Portfolio turnover rate..................................... 17% 13% 34% 23% 57%
</Table>
@ Total investment return, market value, is based on the change in market
price of a share during the year and assumes reinvestment of distributions
at actual prices pursuant to the fund's dividend reinvestment plan.
@@ Total investment return, net asset value, is based on the change in net
asset value of a share during the year and assumes reinvestment of
distributions at actual prices pursuant to the fund's dividend reinvestment
plan.
@@@ Effective April 2, 2001, the adviser was changed from Fortis Advisers, Inc.
to Hartford Investment Financial Services, LLC.
11
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
- --------------------------------------------------------------------------------
TO THE SHAREHOLDERS AND BOARD OF DIRECTORS OF THE HARTFORD INCOME SHARES FUND,
INC.
We have audited the accompanying statement of assets and liabilities of The
Hartford Income Shares Fund, Inc. (the fund), including the schedule of
investments, as of July 31, 2005, and the related statement of operations for
the year then ended, the statements of changes in net assets for each of the two
years in the period then ended, and the financial highlights for each of the
three years in the period then ended. These financial statements and financial
highlights are the responsibility of the fund's management. Our responsibility
is to express an opinion on these financial statements and financial highlights
based on our audits. The financial highlights for the periods presented through
July 31, 2002, were audited by other auditors whose report, dated September 6,
2002, expressed an unqualified opinion on those financial highlights.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free from material misstatement. An
audit includes consideration of internal control over financial reporting as a
basis for designing audit procedures that are appropriate in the circumstances,
but not for the purpose of expressing an opinion on the effectiveness of the
fund's internal control over financial reporting. Accordingly, we express no
such opinion. An audit also includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements and financial
highlights, assessing the accounting principles used and significant estimates
made by management, and evaluating the overall financial statement presentation.
Our procedures included confirmation of securities owned as of July 31, 2005, by
correspondence with the custodian. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of The
Hartford Income Shares Fund, Inc. at July 31, 2005, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended, and the financial highlights for each of
the three years in the period then ended, in conformity with U.S. generally
accepted accounting principles.
-s- Ernst & Young LLP
Minneapolis, Minnesota
September 1, 2005
12
DIRECTORS AND OFFICERS (UNAUDITED)
The Board of Directors elects officers who are responsible for the day-to-day
operations of the fund. Each Director serves until his or her death,
resignation, or retirement or until the next annual meeting of shareholders is
held or until his or her successor is elected and qualifies.
Directors and officers who are employed by or who have a substantial financial
interest in The Hartford are considered "interested" persons of the fund
pursuant to the Investment Company Act of 1940. Each officer and two of the
fund's directors, as noted in the chart below, are "interested" persons of the
fund. Except for Mr. Znamierowski and Ms. Jaffee, each director serves as a
director for The Hartford Mutual Funds, Inc., The Hartford Mutual Funds II,
Inc., The Hartford Income Shares Fund, Inc., Hartford Series Fund, Inc. and
Hartford HLS Series Fund II, Inc., which collectively consist of 80 funds. Mr.
Znamierowski oversees 62 funds and serves as a director only for The Hartford
Mutual Funds, Inc. and Hartford Series Fund, Inc. Ms. Jaffee oversees 63 funds
and serves as a director only for The Hartford Income Shares Fund, Inc., The
Hartford Mutual Funds, Inc. and Hartford Series Fund, Inc. Correspondence may be
sent to directors and officers c/o Secretary, The Hartford Income Shares Fund,
Inc., P.O. Box 2999, Hartford, CT 06104-2999, except that correspondence to Ms.
Fagely and Ms. Settimi may be sent to 500 Bielenberg Dr., Woodbury, MN 55125.
The table below sets forth, for each director and officer, his or her name, age,
current position with the fund and date first elected or appointed, principal
occupation, and, for directors, other directorships held.
NON-INTERESTED DIRECTORS
LYNN S. BIRDSONG (age 59) Director since 2003, Chairman of the Litigation
Committee; Co-Chairman of the Investment Committee
From 1979 to 2002, Mr. Birdsong was a managing director of Zurich Scudder
Investments, an investment management firm. In 2003, Mr. Birdsong became an
independent director of The Japan Fund; during his employment with Scudder,
he was an interested director of The Japan Fund. From 2003 to March 2005,
Mr. Birdsong was an independent director of the Atlantic Whitehall Funds.
Since 1981, Mr. Birdsong has been a partner in Birdsong Company, an
advertising specialty firm.
ROBERT M. GAVIN, JR. (age 65) Director since 1986, Chairman of the Board since
2004
Dr. Gavin is an educational consultant. Prior to September 1, 2001, he was
President of Cranbrook Education Community; and prior to July 1996, he was
President of Macalester College, St. Paul, Minnesota.
DUANE E. HILL (age 60) Director since 2002, Chairman of the Nominating Committee
Mr. Hill is Partner Emeritus and a founding partner of TSG Capital Group, a
private equity investment firm that serves as sponsor and lead investor in
leveraged buyouts of middle market companies. Mr. Hill is also a Partner of
TSG Ventures L.P., a private equity investment company that invests
primarily in minority-owned small businesses.
SANDRA S. JAFFEE (age 63) Director since 2005
Ms. Jaffee is Chief Executive Officer of Searchspace Group, a leading
provider of compliance/regulatory technology to financial institutions.
From September 1995 to July 2004, Ms. Jaffee served as Executive Vice
President at Citigroup, where she was President and Chief Executive Officer
of Citibank's Global Securities Services (1995-2003).
PHILLIP O. PETERSON (age 60) Director since 2000, Chairman of the Audit
Committee
Mr. Peterson is a mutual fund industry consultant. From January 2004 to
April 2005, Mr. Peterson served as Independent President of the Strong
Mutual Funds. Mr. Peterson was a partner of KPMG LLP until July 1999.
INTERESTED DIRECTORS AND OFFICERS
THOMAS M. MARRA (age 47) Director since 2002
Mr. Marra is President and Chief Operating Officer of Hartford Life, Inc.
He is also a member of the Board of Directors and a member of the Office of
the Chairman for The Hartford Financial Services Group, Inc. ("The
Hartford"), the parent company of Hartford Life. Mr. Marra was named
President of Hartford Life in 2001 and Chief Operating Officer in 2000, and
served as Director of Hartford Life's Investment Products Division from
1998 to 2000. Mr. Marra is also a Managing Member and President of Hartford
Investment Financial Services, LLC ("HIFSCO") and HL Investment Advisors,
LLC ("HL Advisors").
LOWNDES A. SMITH (age 65) Director since 2002, Co-Chairman of the Investment
Committee
Mr. Smith served as Vice Chairman of The Hartford from February 1997 to
January 2002, as President and Chief Executive Officer of Hartford Life,
Inc. from February 1997 to January 2002, and as President and Chief
Operating Officer of The Hartford Life Insurance Company from January 1989
to January 2002. Mr. Smith has served as a Director of White Mountains
Insurance Group since November 2003.
13
OTHER OFFICERS
DAVID M. ZNAMIEROWSKI (age 45) President since 2001
Mr. Znamierowski currently serves as President of Hartford Investment
Management Company ("Hartford Investment") and Executive Vice President and
Chief Investment Officer of Hartford Life and Executive Vice President and
Chief Investment Officer of The Hartford. Mr. Znamierowski is also a
Managing Member and Executive Vice President of HIFSCO and HL Advisors.
WILLIAM H. DAVISON, JR. (age 48) Vice President since 2002
Mr. Davison is a Managing Director and Director of the Funds Management
Group of Hartford Investment. Mr. Davison is also a Senior Vice President
of HIFSCO and HL Advisors.
TAMARA L. FAGELY (age 47) Vice President, Controller and Treasurer since 1993
Ms. Fagely has been a Vice President of Hartford Administrative Services
Company (HASCO) since 1998. Prior to 1998, she was Second Vice President of
HASCO. Ms. Fagely is a Vice President of Hartford Life Insurance Company
where she served as Assistant Vice President from December 2001 through
March 2005. In addition, she is Controller of HIFSCO.
MARY JANE FORTIN (age 40) Vice President since 2003
Ms. Fortin is Senior Vice President and Director of Mutual Funds and 529
Programs for Hartford Life Insurance Company. She also serves as Vice
President of HL Advisors and HIFSCO. Previously, Ms. Fortin served as
Senior Vice President and Chief Accounting Officer of Hartford Life.
GEORGE R. JAY (age 53) Vice President since 2001, Chief Compliance Officer since
2004
Mr. Jay serves as Assistant Vice President of Hartford Life Insurance
Company. In addition, he serves as Controller of HL Advisers. He also
serves as Chief Broker-Dealer Compliance Officer for HIFSCO.
STEPHEN T. JOYCE (age 46) Vice President since 2001
Mr. Joyce currently serves as Senior Vice President and Director of the
Institutional Solutions Group for Hartford Life Insurance Company. Mr.
Joyce is also Senior Vice President of HL Advisors. Previously, he served
as Vice President (1997-1999) and Assistant Vice President (1994-1997) of
Hartford Life Insurance Company.
DAVID N. LEVENSON* (age 39) Vice President since 2001
Mr. Levenson served as Senior Vice President of Hartford Life Insurance
Company's Retail Product Management Group and was responsible for all
retail product management. Mr. Levenson was also a Senior Vice President of
HIFSCO and HL Advisors. Currently, Mr. Levenson serves as Managing Director
of Hartford Investment Management.
EDWARD P. MACDONALD (age 38) Vice President and Secretary since 2005
Mr. Macdonald serves as Assistant General Counsel of The Hartford. Prior to
joining The Hartford in 2005, Mr. Macdonald was with Prudential Financial
(formerly American Skandia Investment Services, Inc.) where he served as
Chief Counsel, Investment Management (July 2002 to March 2005); Senior
Counsel, Securities (September 2000 to June 2002); Counsel (December 1999
to August 2000); and Senior Associate of Counsel (April 1999 to December
1999).
DENISE A. SETTIMI (age 44) Vice President since 2005
Ms. Settimi currently serves as Assistant Vice President Securities
Operations of HASCO. Previously, Ms. Settimi was with American Express
Financial Advisors, where she was Director of Retirement Plan Services from
1997 to 2003.
JOHN C. WALTERS (age 43) Vice President since 2001
Mr. Walters serves as Executive Vice President and Director of the
Investment Products Division of Hartford Life Insurance Company. He is also
a Managing Member and Executive Vice President of HIFSCO and HL Advisors.
Previously, Mr. Walters was with First Union Securities.
<Table>
INVESTMENT ADVISER Hartford Investment Financial Services, LLC
P.O. Box 1744, Hartford, CT 06144-1744
DIVIDEND DISBURSING AGENT Hartford Administrative Services Company
P.O. Box 64387, St. Paul, MN 55164
REGISTRAR Wells Fargo Bank, N.A.
Minneapolis, Minnesota
CUSTODIAN State Street Bank and Trust Company
Boston, Massachusetts
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Ernst & Young LLP
Minneapolis, Minnesota
</Table>
MARKET PRICE The Hartford Income Shares Fund, Inc. is listed on
the New York Stock Exchange with the Ticker symbol
"HSF". The market price is carried daily in the
financial pages of most newspapers and carried on
Monday in the "Closed-End Funds" table which sets
forth on a per share basis the previous week's net
asset value, market price and the percentage
difference between net asset value and market price
for the fund under the name "HrtfrdIncoFd".
* Mr. Levenson resigned effective July 1, 2005.
14
SHAREHOLDER MEETING RESULTS (UNAUDITED)
Shareholders of The Hartford Income Shares Fund, Inc. (the "fund") addressed and
approved the following proposals at an annual meeting held on December 15, 2004.
1. To elect the following seven nominees:
<Table>
<Caption>
For Withhold
---------- --------
Lynn S. Birdsong............................................ 10,895,079 184,227
Robert M. Gavin, Jr. ....................................... 10,908,366 170,940
Duane E. Hill............................................... 10,882,487 196,818
Phillip O. Peterson......................................... 10,898,243 181,063
Millard H. Pryor, Jr. ...................................... 10,896,779 182,527
Thomas M. Marra............................................. 10,905,177 174,128
Lowndes A. Smith............................................ 10,901,929 177,376
</Table>
2. To ratify the selection by the Board of Directors of the fund of Ernst &
Young LLP as independent registered public accounting firm for the Company for
the fiscal year ended July 31, 2005.
<Table>
<Caption>
For Against Abstain
- ---------- ------- -------
10,904,416 75,056 99,833
</Table>
IMPORTANT TAX INFORMATION (UNAUDITED)
Shareholders will receive notification in January 2006 of the percentage
applicable to the preparation of their 2005 income tax returns.
MONTHLY DIVIDENDS PAID
<Table>
<Caption>
DATE AMOUNT
- ---- -------------
August 2004................................................. $0.046 Income
September 2004.............................................. 0.046 Income
October 2004................................................ 0.046 Income
November 2004............................................... 0.046 Income
December 2004............................................... 0.046 Income
January 2005................................................ 0.046 Income
February 2005............................................... 0.046 Income
March 2005.................................................. 0.046 Income
April 2005.................................................. 0.046 Income
May 2005.................................................... 0.046 Income
June 2005................................................... 0.046 Income
July 2005................................................... 0.046 Income
-------------
0.552 Income
</Table>
15
PRIVACY POLICY AND PRACTICES OF
THE HARTFORD FINANCIAL SERVICES GROUP, INC. AND ITS AFFILIATES
(HEREIN CALLED "WE, OUR, AND US")
This Privacy Policy applies to our United States Operations
We value your trust. We are committed to the responsible:
a) management;
b) use; and
c) protection;
of PERSONAL INFORMATION.
This notice describes how we collect, disclose, and protect PERSONAL
INFORMATION.
We collect PERSONAL INFORMATION to:
a) service your TRANSACTIONS with us; and
b) support our business functions.
We may obtain PERSONAL INFORMATION from:
A) YOU;
b) your TRANSACTIONS with us; and
c) third parties such as a consumer-reporting agency.
Based on the type of product or service YOU apply for or get from us, PERSONAL
INFORMATION such as:
a) your name;
b) your address;
c) your income;
d) your payment; or
e) your credit history;
may be gathered from sources such as applications, TRANSACTIONS, and consumer
reports.
To serve YOU and service our business, we may share certain PERSONAL
INFORMATION. We will share PERSONAL INFORMATION, only as allowed by law, with
affiliates such as:
a) our insurance companies;
b) our employee agents;
c) our brokerage firms; and
d) our administrators.
As allowed by law, we may share PERSONAL FINANCIAL INFORMATION with our
affiliates to:
a) market our products; or
b) market our services;
to YOU without providing YOU with an option to prevent these disclosures.
We may also share PERSONAL INFORMATION, only as allowed by law, with
unaffiliated third parties including:
a) independent agents;
b) brokerage firms;
c) insurance companies;
d) administrators; and
e) service providers;
who help us serve YOU and service our business.
When allowed by law, we may share certain PERSONAL FINANCIAL INFORMATION with
other unaffiliated third parties who assist us by performing services or
functions such as:
a) taking surveys;
b) marketing our products or services; or
c) offering financial products or services under a joint agreement between us
and one or more financial institutions.
We will not sell or share your PERSONAL FINANCIAL INFORMATION with anyone for
purposes unrelated to our business functions without offering YOU the
opportunity to:
a) "opt-out;" or
b) "opt-in;"
as required by law.
We only disclose PERSONAL HEALTH INFORMATION with:
a) your proper written authorization; or
b) as otherwise allowed or required by law.
Our employees have access to PERSONAL INFORMATION in the course of doing their
jobs, such as:
a) underwriting policies;
b) paying claims;
c) developing new products; or
d) advising customers of our products and services.
We use manual and electronic security procedures to maintain:
a) the confidentiality; and
b) the integrity of;
PERSONAL INFORMATION that we have. We use these procedures to guard against
unauthorized access.
16
Some techniques we use to protect PERSONAL INFORMATION include:
a) secured files;
b) user authentication;
c) encryption;
d) firewall technology; and
e) the use of detection software.
We are responsible for and must:
a) identify information to be protected;
b) provide an adequate level of protection for that data;
c) grant access to protected data only to those people who must use it in the
performance of their job-related duties.
Employees who violate our Privacy Policy will be subject to discipline, which
may include ending their employment with us.
At the start of our business relationship, we will give YOU a copy of our
current Privacy Policy.
We will also give YOU a copy of our current Privacy Policy once a year if YOU
maintain a continuing business relationship with us.
We will continue to follow our Privacy Policy regarding PERSONAL INFORMATION
even when a business relationship no longer exists between us.
As used in this Privacy Notice:
APPLICATION means your request for our product or service.
PERSONAL FINANCIAL INFORMATION means financial information such as:
a) credit history;
b) income;
c) financial benefits; or
d) policy or claim information.
PERSONAL HEALTH INFORMATION means health information such as:
a) your medical records; or
b) information about your illness, disability or injury.
PERSONAL INFORMATION means information that identifies YOU personally and is not
otherwise available to the public. It includes:
A) PERSONAL FINANCIAL INFORMATION; and
B) PERSONAL HEALTH INFORMATION.
TRANSACTION means your business dealings with us, such as:
a) your APPLICATION;
b) your request for us to pay a claim; and
c) your request for us to take an action on your account.
YOU means an individual who has given us PERSONAL INFORMATION in conjunction
with:
a) asking about;
b) applying for; or
c) obtaining;
a financial product or service from us if the product or service is used mainly
for personal, family, or household purposes.
This Privacy Policy is being provided on behalf of the following affiliates of
The Hartford Financial Services Group, Inc.:
American Maturity Life Insurance Company; First State Insurance Company; Hart
Life Insurance Company; Hartford Accident & Indemnity Company; Hartford
Administrative Services Company; Hartford Casualty Insurance Company; Hartford
Equity Sales Company, Inc.; Hartford Fire Insurance Company; Hartford HLS Series
Fund II, Inc.; Hartford Insurance Company of Illinois; Hartford Insurance
Company of the Midwest; Hartford Insurance Company of the Southeast; Hartford
International Life Reassurance Corporation; Hartford Investment Financial
Services, LLC; Hartford Investment Management Company; Hartford Life & Accident
Insurance Company; Hartford Life and Annuity Insurance Company; Hartford Life
Insurance Company; Hartford Life Group Insurance Company, Hartford Lloyd's
Insurance Company; Hartford Mezzanine Investors I, LLC; Hartford Securities
Distribution Company, Inc.; Hartford Series Fund, Inc.; Hartford Specialty
Company; Hartford Specialty Insurance Services of Texas, LLC; Hartford
Underwriters Insurance Company; Hartford-Comprehensive Employee Benefit Service
Company; HL Investment Advisors, LLC; Hartford Life Private Placement, LLC;
M-CAP Insurance Agency, LLC; New England Insurance Company; Nutmeg Insurance
Agency, Inc.; Nutmeg Insurance Company; Nutmeg Life Insurance Company; Omni
General Agency, Inc.; Omni Indemnity Company; Omni Insurance Company; P2P Link,
LLC; Pacific Insurance Company, Limited; Planco Financial Services, Inc.;
Property and Casualty Insurance Company of Hartford; Sentinel Insurance Company,
Ltd.; Servus Life Insurance Company; Specialty Risk Services, Inc.; The Hartford
Income Shares Fund, Inc.; The Hartford Mutual Funds II, Inc.; The Hartford
Mutual Funds, Inc.; Trumbull Insurance Company; Trumbull Services, L.L.C.; Twin
City Fire Insurance Company; Woodbury Financial Services, Inc.
17
UNDERWRITTEN AND DISTRIBUTED THROUGH
Hartford Investment Financial Services, LLC
200 Hopmeadow Street
Simsbury, CT 06070
INVESTMENT MANAGER
Hartford Investment Financial Services, LLC
200 Hopmeadow Street
Simsbury, CT 06070
INVESTMENT SUB-ADVISOR
Hartford Investment Management Company
55 Farmington Avenue
Hartford, CT 06105
- --------------------------------------------------------------------------------
THE HARTFORD INCOME SHARES FUND, INC. PRESORTED
P.O. Box 64387 STANDARD
St. Paul, MN 55164-0387 U.S. POSTAGE PAID
FARMINGDALE, NY
PERMIT NO. 225
[THE HARTFORD LOGO]
Mutual Funds
HTFDINC-8-05 Printed in U.S.A. (C) 2005 The Hartford, Hartford, CT 06115
ITEM 2. CODE OF ETHICS.
Registrant has adopted a code of ethics that applies to Registrant's
principal executive officer, principal financial officer and controller which is
attached as an exhibit.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
The Board of Directors of the Registrant has designated Phillip O.
Peterson as an Audit Committee Financial Expert. Mr. Peterson is considered by
the Board to be an independent director.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) Audit Fees: $25,000.00 for the fiscal year ended July 31, 2004;
$33,000.00 for the fiscal year ended July 31, 2005.
(b) Audit Related Fees: No fees were billed by E+Y for professional
services rendered that are related to the audit of the Company's annual
financial statements but not reported under "Audit-Fees" above for the
fiscal years ended July 31, 2004 and 2005. Aggregate fees in the amount
of $37,500.00 for the fiscal year ended July 31, 2004 and $39,000.00 for
the fiscal year ended July 31, 2005 were billed by E+Y to HIFSCO, or an
affiliate thereof that provides ongoing services to the Company, relating
to the operations and financial reporting of the Company. These fees relate
to an annual review of internal controls, as required by regulation, for
HASCO, an affiliate which provides transfer agency services to the Company
and over 40 other mutual funds in the Hartford Fund family.
(c) Tax Fees: The aggregate fees billed by E+Y for professional services
rendered for tax compliance, tax advice and tax planning for the fiscal
years ended July 31, 2004 and 2005 were $2,550.00 and $3,000.00,
respectively. No fees were billed by E&Y for such services rendered to
HIFSCO, or an affiliate thereof that provides ongoing services to the
Company and subject to pre-approval by the Audit Committee for the fiscal
years ended July 31, 2004 and 2005.
(d) All Other Fees: $0 for the fiscal years ended July 31, 2004 and
July 31, 2005.
(e)(1) A copy of the Audit Committee's pre-approval policies and procedures
is attached as an exhibit.
(e)(2) One hundred percent of the services described in items 4(a) through
4(d) were approved in accordance with the Audit Committee's Pre-Approval
Policy. As a result, none of such services was approved pursuant to
paragraph (c) (7) (i) (c) of Rule 2-01 of Regulation S-X.
(f) None of the hours expended on the principal accountant's engagement to
audit the Registrant's financial statements for the year ended July 31,
2005 were attributed to work performed by persons other than the principal
accountant's full-time permanent employees.
(g) Non-Audit Fees: $40,550.00 for fiscal year ended July 31, 2004;
$42,000.00 for fiscal year ended July 31, 2005.
(h) N/A
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Registrant has a separately designated standing Audit committee
comprised of all independent directors. The members of the Audit Committee are
listed below:
Lynn S. Birdsong
Robert M. Gavin
Duane E. Hill
Sandra S. Jaffee
Phillip O. Peterson
ITEM 6. SCHEDULE OF INVESTMENTS
The Schedule of Investments is included as part of the annual report
filed under Item 1 of this form.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Registrant has delegated the authority to vote proxies to Hartford
Investment Management Company, registrant's sub-adviser. The policies of
Hartford Investment Management Company are attached as an exhibit.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not required for this filing.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
INCOME SHARES FUND
Total Average Shares purchased Maximum number
Period SHARES Price Paid as part of public of shares that may
PURCHASED per share announced plan yet be purchased
- -----------------------------------------------------------------------------------------------------------------
8/2/2004 12,413 7.4110 0 0
9/1/2004 12,337 7.6188 0 0
10/1/2004 11,985 7.7591 0 0
11/1/2004 11,789 7.8886 0 0
12/1/2004 12,059 7.6287 0 0
12/31/2004 11,911 7.7239 0 0
2/1/2005 11,785 7.8060 0 0
3/1/2005 11,820 7.7830 0 0
4/1/2005 12,100 7.5207 0 0
5/2/2005 12,007 7.5785 0 0
6/1/2005 11,666 7.7998 0 0
7/1/2005 11,578 7.8594 0 0
---------------------- -----------------------
Total 143,450 0 0
</Table>
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
There have been no material changes to the procedures by which shareholders may
recommend nominees to the registrant's board of directors since the policy was
last filed in response to this requirement.
ITEM 11. CONTROLS AND PROCEDURES.
(a) Based on an evaluation of the Registrant's Disclosure Controls
and Procedures as of a date within 90 days of the filing date
of this report, the Disclosure Controls and Procedures are
effectively designed to ensure that information required to be
disclosed by the Registrant is recorded, processed, summarized
and reported by the date of this report, including ensuring
that information required to be disclosed in the report is
accumulated and communicated to the Registrant's management,
including the Registrant's officers, as appropriate, to allow
timely decisions regarding required disclosure.
(b) There was no change in the Registrant's internal control over
financial reporting that occurred during the Registrant's last
fiscal half year that has materially affected, or is
reasonably likely to materially affect, the registrant's
internal control over financial reporting.
ITEM 12. EXHIBITS.
12(a)(1) Code of Ethics
(a)(2) Proxy Voting Policy
(a)(3) Audit Committee Pre-Approval Policies and
Procedures
(a)(4) Section 302 certifications of the principal
executive officer, and principal financial
officer of Registrant.
(b) Section 906 certification
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
THE HARTFORD INCOME SHARES FUND, INC.
Date: September 9, 2005
By: /s/David M. Znamierowski
------------------------
David M. Znamierowski
Its: President
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
Date: September 9, 2005 By: /s/David M. Znamierowski
------------------------
Its: President
Date: September 9, 2005 By: /s/Tamara L. Fagely
---------------------
Tamara L. Fagely
Its: Vice President, Controller and
Treasurer
EXHIBIT LIST
12(a)(1) Code of Ethics
12(a)(2) Proxy Voting Policy
12(a)(3) Audit Committee Pre-Approval Policies and Procedures
99.CERT 12(a)(4) Certifications
(i) Section 302 certification of principal executive
officer
(ii) Section 302 certification of principal financial
officer
99.906CERT 12(b) Section 906 certification of principal executive
officer and principal financial officer