The GDL Fund Declares Second Quarter Distribution of $0.16 Per Share
19 May 2016 - 11:30PM
Business Wire
The Board of Trustees of The GDL Fund (NYSE:GDL) (the “Fund”)
declared a $0.16 per share cash distribution payable on June 23,
2016 to common shareholders of record on June 16, 2016.
Each quarter, the Board of Trustees reviews the amount of any
potential distribution from the income, realized capital gain, or
capital available. The Board of Trustees will continue to monitor
the Fund’s distribution level, taking into consideration the Fund’s
net asset value and the financial market environment. The
distribution rate should not be considered the dividend yield or
total return on an investment in the Fund.
The Fund makes annual distributions of its realized net
long-term capital gains and quarterly cash distributions of all or
a portion of its investment company taxable income (which includes
ordinary income and net realized short-term capital gains) to
common shareholders. A portion of the distribution may be a return
of capital. Various factors will affect the level of the Fund’s
income, such as its asset mix and use of merger arbitrage
strategies. To permit the Fund to maintain more stable
distributions, the Fund may distribute more than the entire amount
of income earned in a particular period. Because the Fund’s current
quarterly distributions are subject to modification by the Board of
Trustees at any time and the Fund’s income will fluctuate, there
can be no assurance that the Fund will pay distributions at a
particular rate or frequency.
If the Fund does not generate sufficient earnings (dividends and
interest income and realized net capital gain) equal to or in
excess of the aggregate distributions paid by the Fund in a given
year, then the amount distributed in excess of the Fund’s earnings
would be deemed a return of capital. Since this would be considered
a return of a portion of a shareholder’s original investment, it is
generally not taxable and is treated as a reduction in the
shareholder’s cost basis. Under federal tax regulations, some or
all of the return of capital distributed by the Fund may be taxable
as ordinary income in certain circumstances. This may occur when
the Fund has a capital loss carry forward, net capital gains are
realized in a fiscal year, and distributions are made in excess of
investment company taxable income.
Short-term capital gains, qualified dividend income, ordinary
income, and return of capital, if any, will be allocated on a
pro-rata basis to all distributions to common shareholders for the
year. Based on the accounting records of the Fund as of May 16,
2016, each of the distributions paid to common shareholders in 2016
would include approximately 4% from net investment income, 7% from
net capital gains and 89% would be deemed a return of capital on a
book basis and does not represent information for tax reporting
purposes. The estimated components of each distribution are updated
and provided to shareholders of record in a notice accompanying the
distribution and are available on our website (www.gabelli.com).
The final determination of the sources of all distributions in 2016
will be made after year end and can vary from the monthly
estimates. Shareholders should not draw any conclusions about the
Fund’s investment performance from the amount of the current
distribution. All shareholders with taxable accounts will receive
written notification regarding the components and tax treatment for
all 2016 distributions in early 2017 via Form 1099-DIV.
Investors should carefully consider the investment objectives,
risks, charges, and expenses of the Fund before investing. More
information regarding the Fund’s distribution policy and other
information about the Fund is available by calling 800-GABELLI
(800-422-3554) or visiting www.gabelli.com.
The GDL Fund is a diversified, closed-end management investment
company with $358 million in total net assets whose investment
objective is to achieve absolute returns in various market
conditions without excessive risk of capital. The Fund is managed
by Gabelli Funds, LLC, a subsidiary of GAMCO Investors, Inc.
(NYSE:GBL).
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For The GDL FundVincent E. Brasesco914-921-5070
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