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Posted September 15, 2007 by publisher in Cuba-US Trade

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MIAMI—(BUSINESS WIRE)—The Herzfeld Caribbean Basin Fund, Inc. (NASDAQ: CUBA) (the “Fund”) announced initial terms of its Non-Transferable Rights Offering that was originally announced on July 24, 2007. The Record Date for the Rights Offering will be September 26, 2007. Pursuant to the Rights Offering, the Fund will distribute to Record Date stockholders one non-transferable right (“Right(s)”) for each share of the Fund held on the Record Date. For every Right that a stockholder receives, the stockholder may subscribe for one new share of the Fund (“Share(s)”) at the subscription price. The number of Rights to be issued to a stockholder on the Record Date will be rounded up to the nearest whole number of Rights; no fractional Rights will be issued.

Rights holders may purchase one share of the Fund’s common stock for every one Right held. Rights may be exercised at any time during the subscription period. The subscription period will begin on October 1, 2007, and end at 5:00 p.m. Eastern time on October 19, 2007 (the “Expiration Date”), unless the Rights Offering is extended. The subscription price per share will be set at 85% of the average volume-weighted closing sale price at which the common stock trades on the NASDAQ Capital Market on the Expiration Date and the four preceding trading days. In addition, Record Date stockholders who fully exercise their rights will be entitled to subscribe for additional shares of common stock (“Over-Subscription Shares”). The Over-Subscription Shares will be allocated pro rata to stockholders who over-subscribe based on the number of rights originally issued to them. The Fund may increase the number of shares of common stock subject to subscription by up to 100% of the primary subscription shares.

Subscription certificates evidencing the Rights and a copy of the Prospectus for the Rights Offering will be mailed to Record Date stockholders beginning on or about September 28, 2007. The Rights Offering will be effected only through the Prospectus.

The Fund has filed a registration statement with the U.S. Securities and Exchange Commission. The record, beginning and expiration dates of the Rights Offering are subject to the effectiveness of the Fund’s registration statement. The definitive terms of the offer, including the estimated subscription price, will be contained in the Fund’s prospectus for the offer.

Important Dates:

Record Date September 26, 2007

Expiration Date October 19, 2007

For additional information on the Fund or the rights offering, or to obtain a Prospectus, please contact the Fund at 800-TJH-FUND or visit us on the web at http://www.herzfeld.com/cuba for updated information about the Fund.

The Fund is a non-diversified, closed-end fund managed by HERZFELD/CUBA a division of Thomas J. Herzfeld Advisors, Inc. (based in Miami). The Fund seeks long-term capital appreciation. To achieve its objective the Fund invests in issuers that are likely, in the Advisor’s view, to benefit from economic, political, structural and technological developments in the countries in the Caribbean Basin, which the Fund considers to consist of Cuba, Jamaica, Trinidad and Tobago, the Bahamas, the Dominican Republic, Barbados, Aruba, Haiti, the Netherlands Antilles, the Commonwealth of Puerto Rico, Mexico, Honduras, Guatemala, Belize, Costa Rica, Panama, Colombia, Venezuela and the United States (“Caribbean Basin Countries”).

Investments in the Fund involve risks. Investing in companies of Caribbean Basin Countries may present certain unique risks not associated with domestic investments, such as currency fluctuation, political and economic changes and market risks. These factors may result in greater share price volatility.

Shares of closed-ends funds frequently trade at a discount to net asset value. The price of the Fund’s shares is determined by a number of factors, several of which are beyond the control of the Fund. Therefore, the Fund cannot predict whether its shares will trade at, below or above net asset value.

Before investing in the Fund, investors should carefully consider the investment objective, risks, charges and expenses of the Fund. This information can be found in the Fund’s prospectus on file with the Securities and Exchange Commission. An investor should carefully read the Fund’s prospectus before investing.

Participating stockholders will be required to initially pay for the Shares subscribed for in the offer as well as any additional shares subscribed for as part of the over-subscription privilege at the estimated subscription price.

The Fund’s investment adviser is HERZFELD/CUBA, a division of Thomas J. Herzfeld Advisors, Inc. and the Fund’s shares trade on the NASDAQ Capital Market under the symbol “CUBA.” Thomas J. Herzfeld Advisors, Inc. specializes in the field of closed-end funds. Information about the advisor and the Fund can be found at http://www.herzfeld.com .

This announcement is not an offer to sell these securities and the Fund is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. The Offer will be made only by means of a prospectus and only after the registration statement on file with the Securities and Exchange Commission has been declared effective. The final terms of the Offer may be different from those discussed above.

Contacts

Thomas J. Herzfeld Advisors, Inc.
Cecilia L. Gondor, 305-271-1900

http://www.herzfeld.com/cuba.htm

(full disclosure - I am a shareholder in this fund)

  1. Follow up post #1 added on November 02, 2007 by publisher with 3905 total posts

    Here is a news release on the results of the rights offering.

    “The Herzfeld Caribbean Basin Fund (NASDAQ: CUBA) (the “Fund”) is pleased to announce that its recently completed one-for-one, non-transferable rights offering was over-subscribed, raising approximately $18 million after deduction for expenses related to the offering…”



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  2. Follow up post #2 added on November 05, 2007 by Joel

    Hi folks,

    I think I warned you about putting your brain where your heart is. When you invest in CUBA, you do not do Cubans a favor. Rather, you do the Herzfeld family a favor. The Herzfeld family returned your kindness toward them by more than doubling the amount of shares outstanding of CUBA, which has sunk the price from 15 to 10 in a few weeks. Now, for me, that is great, because I was a short seller of CUBA, knowing that the premium over the net asset value would disappear. My guess, however, is that shareholders are less delighted.

    While I hate the Motley Fool, it would have been better had shareholders of CUBA listened to its advice to avoid shares of CUBA and “invest” in Cuba’s future in some alternative manner. Instead, someone suggested that it was a “pot shot” or something along those lines. Once again, the heart doing the thinking instead of the brain. Better luck on your future investments. But, be smarter next time. And, if CUBA starts to trade at a big premium to net asset value again, sell it and move on. Castro will eventually die, either way, so you will win. But, it would be better to have in die and still have some pesos in your pockets.

    Signed, The Professor


  3. Follow up post #3 added on November 05, 2007 by publisher with 3905 total posts

    Point taken. I suppose the shares are diluted now but they have more money to invest which is the reason they offered the extra shares.

    This could be a healthy dip. Time will tell.



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  4. Follow up post #4 added on November 09, 2007 by Joel

    Just a small correction to your last comment.

    The new shares were sold via the rights offering IN ORDER TO raise more money. It is the sale of those shares that has given CUBA the new money to invest. You may be putting the cart before the horse. Also, CUBA already had a lot of extra money to invest because one of its largest positions, Florida East Coast Industries, was taken private for cash. CUBA has not issued a new financial statement since then, so I do not know if it plans to invest all the extra money in most of the same stocks it already owned, or whether it will be looking for entirely new investments. It ought to be interesting to see. I will be watching for the SEC filing that shows their updated holdings and will report back if I see anything interesting. In the meantime, buenas suerte!


  5. Follow up post #5 added on November 09, 2007 by publisher with 3905 total posts

    Hey,  at least they are not alone with falling share prices.



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  6. Follow up post #6 added on November 26, 2007 by publisher with 3905 total posts

    Forgot to follow up on the results…

    The Herzfeld Caribbean Basin Fund, Inc. Announces the Final Results of Its Non-Transferable Rights Offering

    Marketwire

    November 01, 2007: 03:43 PM EST

    The Herzfeld Caribbean Basin Fund (NASDAQ: CUBA) (the “Fund”) is pleased to announce that its recently completed one-for-one, non-transferable rights offering was over-subscribed, raising approximately $18 million after deduction for expenses related to the offering. The Fund will issue 1,812,392 shares at a final subscription price of $10.04 per share which represents 85% of the average volume-weighted closing sale price at which shares of the Fund traded on the NASDAQ Capital Market on the expiration date of October 26, 2007, and the preceding four trading days.

    Shareholders who exercised their full primary subscription rights were eligible for an over-subscription privilege entitling them to subscribe for additional shares, subject to certain limitations and a pro-rata allotment. Under terms detailed in the prospectus for the offering, the Fund has the latitude to issue additional shares to fill such over-subscription requests by up to 100% of the shares offered. Using a portion of that option, all over-subscription requests will be honored in full.

    Estimated subscription payments in excess of the final subscription price will be returned to shareholders in approximately a week when the new shares are issued.

    The Fund would like to thank all of its shareholders for their strong support of the offering.

    The Herzfeld Caribbean Basin Fund, Inc. is a closed-end fund managed by HERZFELD/CUBA, a division of Thomas J. Herzfeld Advisors, Inc. The Fund seeks long-term capital appreciation. To achieve its objective the Fund invests in issuers that are likely, in the Advisor’s view, to benefit from economic, political, structural and technological developments in the countries in the Caribbean Basin, which the Fund considers to include Cuba, Jamaica, Trinidad and Tobago, the Bahamas, the Dominican Republic, Barbados, Aruba, Haiti, the Netherlands Antilles, the Commonwealth of Puerto Rico, Mexico, Honduras, Guatemala, Belize, Costa Rica, Panama, Colombia, Venezuela and the United States. There can be no assurance that this objective will be met.

    Thomas J. Herzfeld Advisors, Inc. specializes in the field of closed-end funds. Information about the advisor and the Fund can be found at http://www.herzfeld.com. Information about research published by Thomas J. Herzfeld Advisors, Inc. is available at http://www.herzfeldresearch.com

    This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the securities to be offered in any state in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state.

    For further information contact:
    Cecilia L. Gondor
    305-271-1900
    Thomas J. Herzfeld Advisors, Inc.
    PO Box 161465
    Miami, FL 33116
    http://www.herzfeld.com



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  7. Follow up post #7 added on November 26, 2007 by publisher with 3905 total posts

    and this out today…

    The Herzfeld Caribbean Basin Fund, Inc. Declares $1.28 per Share Year-End Distribution

    MIAMI, FL—(MARKET WIRE)—Nov 26, 2007—The Board of Directors of The Herzfeld Caribbean Basin Fund, Inc. (NasdaqCM:CUBA - News) declared a year-end distribution of $1.28 per share, consisting of $1.05 per share from net long-term capital gains, and $0.23 per share from net investment income, payable on January 9, 2008 to stockholders of record December 12, 2007. The distribution is taxable to stockholders for the calendar year 2007.

    The distribution will be payable in Fund shares unless the stockholder elects to receive cash. Currently the market price per share of the common stock is trading at a discount to NAV but has at times traded at a premium to NAV. If the market price per share of common stock, on the payment date, is equal to or exceeds the NAV (“trading at a premium”), the distribution will be payable to shareholders in newly issued Shares valued at the greater of (1) NAV or (2) 95% of the then-current market price of the Shares. If the NAV on the payment date exceeds the market price of the Shares at the time (“trading at a discount”), the distribution per share will be payable to shareholders in Shares valued at market price.

    Including this distribution, The Herzfeld Caribbean Basin Fund, Inc. will have paid a total of $3.966 per share in distributions since the Fund’s inception in 1994.



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