WIXLIB

are entitled, you also may subscribe for Shares that were not otherwisesubscribed for by other Exercising Rights Holders. Shares acquired pursuant tothe Over-Subscription Privilege are subject to allotment, which is more fullydiscussed below under "The Offer--Over-Subscription Privilege" on page 12.Sale of RightsThe Rights are transferable until the Expiration Date of the Offer. TheRights will be listed for trading on the American Stock Exchange. The Fund willuse its best efforts to ensure that an adequate trading market for the Rightswill exist. No assurance can be given that a market for the Rights willdevelop. Trading in the Rights on the Exchange may be conducted until the closeof trading on the Exchange on the last Business Day prior to the ExpirationDate of the Offer.Offering Fees and ExpensesThe Fund has agreed to pay the Dealer Manager a fee for its financialadvisory, marketing and soliciting services equal to 0.90% of the aggregateSubscription Price for Shares issued pursuant to the Offer. The Fund will paybroker-dealers which have assisted in soliciting the exercise of Rights asdescribed in this Prospectus. Other offering expenses incurred by the Fund areestimated at 310,000, which includes up to 50,000 that may be paid to theDealer Manager as partial reimbursement for its expenses relating to the Offer.4The FundThe Fund has been engaged in business as a diversified, closed-end managementinvestment company since 1988. The Fund's investment objective is to provide ahigh level of total return through current income and capital appreciation byinvesting primarily in high-yield fixed income securities of domesticcompanies.The Fund invests in a portfolio comprised primarily of lower-rated fixedincome securities (commonly referred to as "junk bonds") and other types ofhigh risk securities. The Fund maintains a leveraged capital structure whichcreates the opportunity for greater total returns, but also involves certainsubstantial additional risks.No assurance can be given that the Fund will achieve its investmentobjective.The AdviserPacholder & Company, LLC serves as the Fund's investment adviser. William J.Morgan has directed and supervised the overall portfolio management strategyfor the Fund since the Fund commenced operations in 1988. Mr. Morgan also hasbeen responsible for the day-to-day management of the Fund's portfolio sinceJune 2000.The Adviser's fee is based on the average net assets of the Fund. Thus, theAdviser will benefit from an increase in the Fund's assets resulting from theOffer. The Dealer Manager, the Administrator and Pacholder Associates,affiliates of the Adviser, also will benefit from the Offer.Risk Factors and Special ConsiderationsBefore exercising your Rights pursuant to the Offer, you should consider thefactors described in this Prospectus, including without limitation, the factorsdescribed under "The Fund," "Investment Policies and Limitations" and "RiskFactors and Special Considerations."As discussed more fully in the body of this Prospectus, investment in theFund involves a number of significant risks, including:.the possibility that the lower-rated securities in which the Fundinvests may be more likely to default and more volatile than other debtsecurities;.fluctuation of the Fund's net asset value in connection with changes inthe value of its portfolio securities; and.risks associated with the Fund's investments in restricted and illiquidsecurities, foreign securities, and use of certain investmentstrategies.Copyright 2012 www.secdatabase.com. All Rights Reserved.Please Consider the Environment Before Printing This Document

The Fund's leveraged capital structure involves certain significantadditional risks, including:.exaggeration of any increases or decreases in the net asset value of theCommon Stock and the yield on the Fund's portfolio; and.the possibility that the dividends payable on the Preferred Stock mayexceed the income from the securities purchased by the Fund.Although the Offer will be conducted at net asset value, some dilution willresult from the Offer:.Shareholders who do not fully exercise their Rights will, upon thecompletion of the Offer, own a smaller proportional interest in the Fundthan would otherwise be the case.Some dilution of the aggregate net asset value of the common sharescurrently owned by the shareholders will occur as a result of theexpenses of the Offer.If you do not wish to exercise your Rights you can still transfer orsell your Rights as set forth in this Prospectus. The cash you receivefrom transferring your Rights should serve as partial compensation forany possible dilution of your interest in the Fund. The Fund, however,cannot provide assurance that a market for the Rights will develop. TheFund also cannot give assurance that the Rights will have a specificvalue or any value at all.5FEE TABLE AND EXAMPLEThe following Fee Table and Example are intended to assist investors inunderstanding the costs and expenses that an investor in the Fund will beardirectly or indirectly.Fee Table: TABLE S Shareholder Transaction ExpensesSales Load (as a percentage of the Subscription Price per Share)(1).Annual Expenses (as a percentage of net assets attributable to CommonStock)Management Fees(2).Administration Fees.Other Expenses(3). C 3.40%1.52%0.17%0.27%---Total Annual Expenses. 1.96% /TABLE -------(1) The Fund will pay to broker-dealers that have executed and delivered aSoliciting Dealer Agreement with the Fund solicitation fees equal to 2.50%of the Subscription Price per Share for each Share issued pursuant to theexercise of Rights as a result of their soliciting efforts. The Fund hasagreed to pay Winton Associates, Inc. (the "Dealer Manager") a fee for itsfinancial advisory, marketing and soliciting services equal to 0.90% ofthe aggregate Subscription Price for Shares issued pursuant to the Offer.The Fund also has agreed to reimburse the Dealer Manager for its expensesrelating to the Offer up to an aggregate of 50,000. In addition, the Fundhas agreed to pay fees to the Subscription Agent and the InformationAgent, estimated to be 13,500 and 6,500, respectively, for theirservices related to the Offer, excluding reimbursement for their out-ofpocket expenses. These fees and expenses will be borne by the Fund andindirectly by all of the Fund's shareholders, including those shareholderswho do not exercise their Rights.(2) Based on the 0.90% fulcrum fee applied to the Fund's net assetsattributable to Common Stock as required by SEC regulations. The Fund paysthe Adviser a monthly fee at an annual rate ranging from 0.40% to 1.40%.For the fiscal year ended December 31, 2000, the Fund paid management feesequal to 0.64% of its net assets attributable to Common Stock and 0.40% ofits average net assets. See "Management of the Fund--The Adviser."(3) Amounts are based on estimated amounts for the Fund's current fiscal yearafter giving effect to the anticipated net proceeds of the Offer assumingCopyright 2012 www.secdatabase.com. All Rights Reserved.Please Consider the Environment Before Printing This Document

that all of the Rights are exercised and assuming the Fund re-establishesits leverage as described under "Risk Factors and Special Considerations-Risk of Leverage" at page 27 of this Prospectus.Example: TABLE CAPTION S An investor would pay the following expenses ona 1,000 investment, assuming a 5% annualreturn throughout the periods. /TABLE Cumulative Expenses Paid forthe Period of:------------------------------1 Year 3 Years 5 Years 10 Years------ ------- ------- ------- C C C C 55 96 140 262The Example set forth above assumes reinvestment of all dividends and otherdistributions at net asset value, and an annual expense ratio of 1.96%. TheFee Table above and the assumption in the Example of a 5% annual return arerequired by Securities and Exchange Commission ("SEC") regulations applicableto all management investment companies. The Example and Fee Table should notbe considered as a representation of past or future expenses or annual ratesof return, which may be more or less than those assumed for purposes of theExample and Fee Table. In addition, while the Example assumes reinvestment ofall dividends and other distributions at net asset value, participants in theFund's Dividend Reinvestment Plan may receive shares purchased or issued at aprice or value different from net asset value. See "Dividends andDistributions."6FINANCIAL HIGHLIGHTSThe table below sets forth certain specified information for a share ofCommon Stock outstanding throughout each period presented. The financialhighlights for each of the years in the ten year period ended December 31,2000 have been audited by Deloitte & Touche LLP, the Fund's independentauditors, whose report, along with the most recent financial statements, isincorporated herein by reference. The information should be read inconjunction with those financial statements and notes thereto, which areincorporated herein by reference, in the Fund's December 31, 2000 AnnualReport, which is available upon request from the Fund. TABLE CAPTION S Per Share OperatingPerformance:Net asset value,beginning ofperiod.Net investmentincome.Net realized andunrealizedgain/(loss) oninvestments.Netincrease/(decrease)in net asset valueresulting fromoperations.Distributions toStockholders from:Preferreddividends.Common:Net investmentYear Ended December --------------------------- ---------- ---------- ------------- ------ C C C C C C C C C 13.55---------- 15.19---------- 17.40---------- 17.44---------- 16.02---------- 16.86---------- 19.23------- 18.52------- ----------1.42----------(0.06)(1.64)---------- )(0.49)(0.49)Copyright 2012 www.secdatabase.com. All Rights Reserved.Please Consider the Environment Before Printing This Document(0.46)(0.29)0.48-------(0.24)(0.38)(0.33)

income and shortterm gains.Net realized longterm gains.Total distributionsto preferred andcommonstockholders.Capital ChangeResulting from theIssuance of FundShares:Common Shares.Preferred Shares.Net asset value,end of period.Market value pershare, end ofperiod.Total InvestmentReturn:Based on marketvalue per commonshare(1).Based on net assetvalue per commonshare(2).Ratios to AverageNet Assets(3):Expenses.Net investmentincome.Supplemental Data:Net assets at endof period, net ofpreferred stock(000).Average net assetsduring period, netof preferred stock(000).Portfolio turnoverrate.Number of preferredshares outstandingat end of period.Asset coverage pershare of preferredstock outstandingat end of period.Liquidation andaverage marketvalue per share ofpreferred stock. CAPTION S Per Share OperatingPerformance:Net asset value,beginning ofperiod.Net investmentincome.Net realized andunrealizedgain/(loss) (2.08)----------------------(0.16)----------- --------(2.37)(2.16)(2.19)(2.16)---------- ---------- ---------- -------(2.68)(2.41)------- ------- ---------(0.72)----------- ----------(0.67)(0.69)(0.11)----------- ------(0.78)(0.69)---------- -------(0.51)--(0.13)------- ------(0.51)(0.13)------- ------- 10.03 13.55 15.19 17.40 17.44 16.02 16.86 19.23 18.52 10.56 11.63 16.38 18.19 17.88 17.38 16.75 21.25 19.38 97%-----------(1.92)(11.12)%(0.21)-------- %1.90%10.45%10.17%10.33%10.32% 95,457 128,752 108,190 123,442 87,054 79,596 58,925 44,458 34,001 115,318 130,836 119,223 118,893 83,074 79,614 59,002 43,275 10,000 47 57 64 70 73 66 7,852 5,730 4,400 20 20 20 20 20 20 1,000 1,000 1,0001991------- C 14.49-------2.182.84--------NetCopyright 2012 www.secdatabase.com. All Rights Reserved.Please Consider the Environment Before Printing This Document

increase/(decrease)in net asset valueresulting fromoperations.Distributions toStockholders from:Preferreddividends.Common:Net investmentincome and shortterm gains.Net realized longterm gains.Total distributionsto preferred andcommonstockholders.Capital ChangeResulting from theIssuance of FundShares:Common Shares.Preferred Shares.Net asset value,end of period.Market value pershare, end ------------------- 17.37 17.25 Total InvestmentReturn:Based on marketvalue per commonshare(1).56.78%Based on net assetvalue per commonshare(2).36.71%Ratios to AverageNet Assets(3):Expenses.1.37%Net investmentincome.12.94%Supplemental Data:Net assets at endof period, net ofpreferred stock(000). 31,678Average net assetsduring period, netof preferred stock(000). 30,724Portfolio turnoverrate.48%Number of preferredshares outstandingat end of period.-Asset coverage pershare of preferredstock outstandingat end of period.-Liquidation andaverage marketvalue per share ofpreferred stock.- /TABLE ---(1) Total investment return excludes the effects of commissions.(2) Dividends and distributions, if any, are assumed, for purposes of thiscalculation, to be reinvested at prices obtained under the Fund's dividendreinvestment plan. Rights offerings, if any, are assumed, for purposes ofCopyright 2012 www.secdatabase.com. All Rights Reserved.Please Consider the Environment Before Printing This Document

this calculation, to be fully subscribed under the terms of the rightsoffering.(3) Ratios calculated on the basis of expenses and net investment incomeapplicable to both the common and preferred shares relative to the averagenet assets of both the common and preferred shareholders.7CAPITALIZATION AT DECEMBER 31, 2000 TABLE CAPTION AmountTitle of ClassAmount - --------------- S C C Common Stock, .01 par value. 46,500,000 shares 9,522,160 sharesCumulative Preferred Stock, .01 par value. 3,500,000 shares 3,500,000 shares /TABLE Amount HeldBy Fund ForIts Account---------- C 0 shares0 sharesINFORMATION REGARDING SENIOR SECURITIESThe following table shows certain information regarding each class of seniorsecurity of the Fund as of the end of each fiscal year of the Fund since itsinception. TABLE CAPTION S 8.60% CumulativePreferred Stock.6.95% CumulativePreferred Stock.Cumulative PreferredStock.InvoluntaryLiquidationTotal AmountAsset Coverage for PreferenceAt December 31 Outstanding (shs)Shares ( )(4)Per Share ( )-------------- ----------------- ------------------ ------------ C C C C ApproximateMarket ValuePer Share(5)----------- C 03,500,0003,500,0007064574720202020----- /TABLE -------(1) On April 15, 1992, the Fund issued 10,000 shares of 8.60% CumulativePreferred Stock. In 1993, the Fund redeemed shares of such stock having anaggregate liquidation value of 600,000, and in 1994 the Fund redeemedshares of such stock having an aggregate liquidation value of 800,000.(2) On August 15, 1995, the remaining shares of 8.60% Cumulative PreferredStock were called for redemption and the Fund issued 1,650,000 shares of6.95% Cumulative Preferred Stock.(3) On March 3, 1997, the shares of 6.95% Cumulative Preferred Stock wereexchanged on a share-for-share basis for shares of Series A CumulativePreferred Stock and the Fund issued 800,000 shares of Series B CumulativeStock. On December 14, 1998, the shares of Series A and Series BCumulative Preferred Stock were exchanged on a share-for-share basis forshares of Series C and Series D Cumulative Preferred Stock, respectively.On March 26, 1999, the Fund issued 1,050,000 shares of 6.46% Series ECumulative Preferred Stock. The Fund expects to re-establish leverage uponcompletion of the Offer. See "The Fund," "Risk Factors and SpecialConsiderations--Risk of Leverage" and "Description of Capital Stock-Preferred Stock."(4) Amount shown is per share of Preferred Stock. Calculated by subtractingthe Fund's total liabilities (not including senior securities constitutingdebt but including Preferred Stock) from the Fund's total assets anddividing such amount by the number of outstanding shares of PreferredStock.(5) All shares of Preferred Stock have been issued in private placements andCopyright 2012 www.secdatabase.com. All Rights Reserved.Please Consider the Environment Before Printing This Document

there have been no market transactions.8TRADING AND NET ASSET VALUE INFORMATIONIn the past, the Fund's shares have traded both at a premium and at adiscount in relation to

PACHOLDER HIGH YIELD FUND, INC. 3,175,092 Shares of Common Stock Issuable Upon Exercise of Rights to Subscribe for Such Shares of Common Stock-----Pacholder High Yield Fund, Inc. (the "Fund") is issuing transferable rights to its shareholders. You will receive one right for each share of common stock you own on the record date, which is March 5 .