SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities and Exchange Act of 1934
(Amendment No. 36)
Cornerstone Strategic Value Fund
(CLM)
Common Stock
(Title of Class of Securities)
21924B104
(CUSIP Number)
George W. Karpus, President
Karpus Management, Inc. d/b/a
Karpus Investment Management
183 Sullys Trail
Pittsford, New York 14534
(716) 586-4680
(Name, Address, and Telephone Number of Person Authorized to Receive
Notices and Communications)
September 9, 2002
(Date of Event which Requires Filing of this Statement)
If the person has previously filed a statement on Schedule 13G to
report the Acquisition which is the subject of this Schedule 13D,
and is filing this schedule because of Rule 13d-1 (b) (3) or (4), check
the following box. [ ]
(Page 1 of 7 pages)
Exhibit 1 attached.
ITEM 1 Security and Issuer
Common Stock
Cornerstone Strategic Value Fund
Cornerstone Advisors, Inc.
575 Lexington Avenue
New York, NY 10022
ITEM 2 Identity and Background
a) Karpus Management, Inc. d/b/a Karpus Investment
Management (?KIM?)
George W. Karpus, President, Director and Controlling
Stockholder
JoAnn VanDegriff, Vice President and Director
Sophie Karpus, Director
b) 183 Sullys Trail
Pittsford, New York 14534
c) Principal business and occupation - Investment Management
for individuals, pension and profit sharing plans, corporations,
endowments, trust and others, specializing in conservative asset
management (i.e. fixed income investments).
d) None of George W. Karpus, JoAnn VanDegriff, or Sophie
Karpus (?the Principals?) or KIM has been convicted in the past
five years of any criminal proceeding (excluding traffic
violations).
e) During the last five years none of the principals or KIM has
been a party to a civil proceeding as a result of which any of them
is subject to a judgment, decree or final order enjoining future
violations of or prohibiting or mandating activities subject to,
federal or state securities laws or finding any violation with
respect to such laws.
f) Each of the Principals is a United States citizen.
KIM is a New York corporation.
ITEM 3 Source and Amount of Funds or Other Considerations
KIM, an independent investment advisor, has accumulated shares
of CLM on behalf of accounts that are managed by KIM (?the
Accounts?) under limited powers of attorney. All funds that
have been utilized in making such purchases are from such
Accounts.
ITEM 4 Purpose of Transaction
a) KIM has purchased Shares for investment purposes. Being
a Closed-End Fund Specialist the profile of CLM fit the
investment guidelines for various Accounts. Shares have been
acquired since October 23, 1989.
b) Although originally purchased for investment purposes only, due
to the Fund?s poor performance and the wide discount to net asset
value, we intend to influence management with the intent of narrowing
or eliminating the discount to net asset value. The attached proposal
(Exhibit 1) was sent to the Board on December 17, 2001. KIM reserves
the right to further accumulate or sell shares. On May 3, 2002 the Board
of Directors of CLM announced that they would be postponing their
annual stockholders meeting scheduled to take place on May 14. KIM
still plans to present our proposal to shareholders when the meeting is
rescheduled. On June 25, KIM sent a letter to the fund requesting a list
of shareholders.
ITEM 5 Interest in Securities of the Issuer
a) As of the date of this report KIM owns 550,180 shares, which
represents 14.46% of the outstanding Shares. Karpus Investment
Management Profit Sharing Plan owns 4,250 shares. 200 purchased
on June 24, 1993 at $9.125, 400 purchased on August 26, 1993 at
$9.875, 300 purchased on January 29, 1998 at $10.25, 500 purchased
on April 29, 1999 at $13.125, December 11, 2000 at $10.65 per share
(1000 shares), December 20 at $10.75 per share (500 shares), and
September 28, 2001 at $6.40 per share (1500 shares). On March 27,
2000 150 shares were sold at $14.20 per share. None of the other
principles of KIM currently owns any shares.
b) KIM has the sole power to dispose of and to vote all of such
Shares under limited powers of attorney.
c) The first open market purchase occurred on October 23, 1989
Open market purchases for the last 60 days for the Accounts.
There have been no dispositions and no acquisitions, other than by
such open market purchases.
DATE
SHARES
PRICE PER
DATE
SHARES
PRICE PER
SHARE
SHARE
7/1/2002
-1400
6.5
8/6/2002
-100
5.7
7/3/2002
800
6.5
8/12/2002
500
5.83
7/10/2002
500
6.46
8/16/2002
1000
5.83
7/10/2002
-120
6.45
8/22/2002
-450
6.17
7/15/2002
400
6.05
7/16/2002
100
6.05
7/23/2002
-1500
5.2
7/23/2002
-250
5.35
* Shares from 08/12 were transferred into our firm.
The Accounts have the right to receive all dividends from, any
proceeds from the sale of the Shares. KIM reserves the right to
further accumulate or sell shares. None of the Accounts has an
interest in shares constituting more than 5% of the Shares
outstanding.
ITEM 6 Contracts, Arrangements, Understandings, or Relationships
with Respect to Securities of the Issuer.
Except as described above, there are no contracts,
arrangements, understandings or relationships of any kind
among the Principals and KIM and between any of them and any
other person with respect to any of CLM Securities.
ITEM 7 Materials to be Filed as Exhibits
Exhibit 1 attached.
Signature
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete,
and correct.
Karpus Management, Inc.
September 9, 2002 By:________________________
Date Signature
George W. Karpus, President
Name/Title
Exhibit 1
Proposal sent to Board December 17, 2001
December 17, 2001
Mr. Ralph W. Bradshaw, President
Cornerstone Strategic Value Fund
Cornerstone Advisers Inc.
575 Lexington Avenue
New York, NY 10022
Dear Mr. Bradshaw:
Karpus Management, Inc. d/b/a Karpus Investment Management (KIM), is the
beneficial owner as of November 30, 2001, of 477935 shares of the common
stock of Cornerstone Strategic Value Fund, Inc. (CLM) (the Fund) for at least
one year or more as attested by Schedule 13D filings with the Securities and
Exchange Commission. We have been the beneficial owner of the shares valued
at more than $2,000 for more than one year and expect to continue ownership
through the date of the Fund's next shareholder meeting. KIM?s first purchase
of shares began on October 23, 1989. All such purchases have been made in
the open market.
Pursuant to Rule 14-28(b) (2) (ii) of the Securities Exchange Act of 1934, we
(KIM) are hereby submitting the following proposal and supporting statement
for inclusion in any an all proxy materials at the next meeting of
shareholders. Attached is our Schedule 13D as electronically filed with the
Securities and Exchange Commission.
PROPOSAL
Karpus Investment Management proposes: Cornerstone Strategic Value Fund,
Inc. (CLM) be converted to an open-end fund within 90 days after acceptance
by the shareholders.
SUPPORTING STATEMENT
It is the belief of KIM that current Fund Management of CLM is not making
significant strides in closing the discount at which the Fund trades. For
the time period from January 5, 2001 through December 7, 2001 the Fund
has traded at an average discount of 15.79%.
Management claims that the share buy back program can help close this discount
over time. It is the opinion of KIM this can not happen simply by the Fund
repurchasing shares. KIM believes that drastic steps must occur for the
shareholders to recognize the full economic value of their investment.
KIM believes the only way for shareholders to reap the full value of their
investment is to open-end the Fund. If this would occur, shareholders
would immediately increase the value of their investment by 14.46%
(based on the net asset value of December 7, 2001)!
It is the opinion of KIM that the current Fund Management may not have
sufficient experience to be the best choice for managing the Fund. KIM
believes that the Fund?s Manager lacks adequate experience in managing
individual securities (only funds in a closed-end format). The current manager
does not have a track record, known to KIM, to instill our confidence in their
abilities.
Poor performance in both price and net asset value does not have to be
Tolerated by the shareholders. Management will claim that they are doing a
good job and they have not been the manager long enough for shareholders to
recognize their abilities. KIM believes that the shareholders must act now.
Time is not on the side of the shareholders to wait!
From January 4, 2001 through December 6, 2001 the net asset value
performance of CLM has equaled ?19.4518% (-20.9417% annual equivalent).
The price performance of the Fund has been equally dismal. For the same
Holding period price performance equaled ?20.80% (-22.3781 annual equivalent).
(All calculations by Bloomberg) KIM believes that the shareholders deserve
better performance than what has been delivered in 2001.
CLM is plagued by low trading volume. Trading volume from January 4, 2001
through December 6, 2001 has averaged a mere 8,706 shares. It is KIM?s
opinion that shareholders who wish to liquidate large positions could severely
depress the price at which the Fund trades. This could cause economic
harm to shareholders remaining in CLM.
KIM believes open ending is the only possible method for shareholders to
recognize the economic reality of their investment. Open ending
would allow shareholders, such as KIM, who do not have confidence in
the direction of the Fund?s management, to get out of the Fund.
Should CLM be open ended at net asset value, shareholders would recognize
an immediate economic benefit of approximately 14.46% (based on price of
$7.93 and NAV of $9.27 as of 12/7/01).
KIM further believes that any Investment Advisor is not fulfilling their
Fiduciary duty to their clients if they do not vote to open end CLM.
Sincerely,
Scott D. Nasca
Corp Vice President