Opinion
on the Financial Statements
We
have audited the accompanying statement of assets and liabilities, including the schedule of investments, of The Gabelli Global
Utility & Income Trust (the “Fund”) as of December 31, 2020, the related statement of operations for the year
ended December 31, 2020, the statement of changes in net assets attributable to common shareholders for each of the two years
in the period ended December 31, 2020, including the related notes, and the financial highlights for each of the five years in
the period ended December 31, 2020 (collectively referred to as the “financial statements”). In our opinion, the financial
statements present fairly, in all material respects, the financial position of the Fund as of December 31, 2020, the results of
its operations for the year then ended, the changes in its net assets attributable to common shareholders for each of the two
years in the period ended December 31, 2020 and the financial highlights for each of the five years in the period ended December
31, 2020 in conformity with accounting principles generally accepted in the United States of America.
Basis
for Opinion
These
financial statements are the responsibility of the Fund’s management. Our responsibility is to express an opinion on the
Fund’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting
Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S.
federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We
conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement,
whether due to error or fraud.
Our
audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to
error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence
regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles
used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.
Our procedures included confirmation of securities owned as of December 31, 2020 by correspondence with the custodian and brokers;
when replies were not received from brokers, we performed other auditing procedures. We believe that our audits provide a reasonable
basis for our opinion.
/s/PricewaterhouseCoopers
LLP
New York, New York
February 26, 2021
We
have served as the auditor of one or more investment companies in the Gabelli/GAMCO Fund Complex since 1986.
The
Gabelli Global Utility & Income Trust
Additional Fund Information (Unaudited)
Summary
of Updated Information Regarding the Fund
The
following information in this annual report is a summary of certain information about the Fund and changes since the Fund’s
last annual report to shareholders as of December 31, 2019, for the fiscal year ended December 31, 2020. This information may
not reflect all of the changes that have occurred since you invested in the Fund.
INVESTMENT
OBJECTIVE AND POLICIES
Investment
Objective
The
Fund’s investment objective is to seek a consistent level of after-tax total return over the long-term with an emphasis
currently on qualifying dividends. The Fund will attempt to achieve its investment objective by investing, under normal market
conditions, at least 80% of its assets in (i) equity securities (including common stock, preferred stock, convertible stock and
options on these securities) of domestic and foreign companies involved to a substantial extent (i.e., at least 50% of the assets,
gross income or net profits of a company is committed to or derived from) in providing (a) products, services or equipment for
the generation or distribution of electricity, gas or water, (b) infrastructure operations such as airports, toll roads and municipal
services and (c) telecommunications services such as telephone, telegraph, satellite, cable, microwave, radiotelephone, mobile
communication and cellular, paging, electronic mail, videotext, voice communications, data communications and internet (collectively,
the “Utilities Industry”) and (ii) securities (including preferred and debt securities, as well as government obligations)
of issuers that are expected to periodically pay dividends or interest. The Fund’s 80% policy is not fundamental and shareholders
will be notified if it is changed. In addition, under normal market conditions, at least 25% of the Fund’s assets will consist
of securities (including preferred and debt securities) of domestic and foreign companies involved to a substantial extent in
the Utilities Industry. The remaining Fund assets will generally be invested in other securities that the Investment Adviser views
as not being correlated with the Fund’s Utilities Industry investments. Such investments may include convertible securities,
securities of issuers subject to reorganization or other risk arbitrage investments, certain derivative instruments including
equity contract for difference swap transactions, other debt securities (including obligations of the U.S. Government), and money
market instruments. The Fund may invest without limitation in securities of foreign issuers and will generally be invested in
securities of issuers located in at least three countries, including the United States. It is anticipated that, under normal market
conditions, at least 40% of the Fund’s assets will be invested in foreign securities. Foreign securities are securities
of issuers based outside the United States. The Fund considers an issuer to be based outside of the United States if (1) it is
organized under the laws of, or has a principal office located in, another country; (2) the principal trading market for its securities
is in another country; or (3) it (directly or through its consolidated subsidiaries) derived in its most current fiscal year at
least 50% of its total assets, capitalization, gross revenue or profit from goods produced, services performed or sales made in
another country. The Fund may purchase sponsored ADRs or U.S. dollar denominated securities of foreign issuers, which will be
considered foreign securities for purposes of the Fund’s investment policies. Typically, the Fund will not hold any foreign
securities of emerging market issuers and, if it does, such securities are not expected to comprise more than 10% of the Fund’s
managed assets. The Fund expects to invest in securities across all market capitalization ranges. The Fund may invest up to 10%
of its total assets in securities rated below investment grade by recognized statistical rating agencies or unrated securities
of comparable quality, including securities of issuers in default, which are likely to have the lowest rating. Securities rated
below investment grade, which may be preferred shares or debt, are predominantly speculative and involve major risk exposure to
adverse conditions. Securities that are rated lower than “BBB” by S&P, or lower than “Baa” by Moody’s
or unrated securities considered by the Investment Adviser to be of comparable quality, are commonly referred to as “junk
bonds” or “high yield” securities.
No
assurance can be given that the Fund’s investment objective will be achieved.
Investment
Methodology of the Fund
In
selecting securities for the Fund, the Investment Adviser normally considers the following factors, among others:
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the
industry of the issuer of a security;
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the
potential of the Fund to earn gains from writing covered call options on such securities;
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the
interest or dividend income generated by the securities;
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the
potential for capital appreciation of the securities;
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the
prices of the securities relative to comparable securities;
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whether
the securities are entitled to the benefits of call protection or other protective covenants;
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the
existence of any anti-dilution protections or guarantees of the security; and
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Additional Fund Information (Continued) (Unaudited)
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the
number and size of investments of the portfolio as to issuers.
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The
Investment Adviser’s investment philosophy with respect to debt and equity securities is to identify assets that are selling
in the public market at a discount to their private market value. The Investment Adviser defines private market value as the value
informed purchasers are willing to pay to acquire assets with similar characteristics. The Investment Adviser also normally evaluates
an issuer’s free cash flow and long-term earnings trends. Finally, the Investment Adviser looks for a catalyst, something
indigenous to the company, its industry or country that will surface additional value.
Certain
Investment Practices
Utilities
Industry Concentration. Under normal market conditions the Fund will invest at least 25% of its assets in the securities
(including preferred and debt securities) of domestic and foreign companies involved to a substantial extent in the Utilities
Industry.
Tax-Advantaged
Qualified Dividends. The Fund’s investments will emphasize securities that will pay tax-advantaged qualified dividends.
For the Fund to receive tax-advantaged qualified dividends, the Fund must, in addition to other requirements, hold the otherwise
qualified stock for more than 60 days during the 121-day period beginning 60 days before the ex-dividend date (or, in the case
of preferred stock, more than 90 days during the 181-day period beginning 90 days before the ex-dividend date). The “ex-dividend
date” is the date which is established by a stock exchange (usually two business days before the record date) whereby the
owner of a security at the commencement of such date is entitled to receive the next issued dividend payment for such security,
even if the security is sold by such owner on the ex-dividend date or thereafter. In addition, for dividends to be tax-advantaged
qualified dividends, the Fund cannot have an option to sell or be under a contractual obligation to sell (pursuant to a short
sale or otherwise) substantially identical stock or securities. Accordingly, the Fund’s writing of call options may, depending
on the terms of the option, adversely impact the Fund’s ability to pay tax-advantaged qualified dividends. For an individual
shareholder to be taxed at the rates applicable to tax-advantaged qualified dividends on dividends received from the Fund that
are attributable to tax-advantaged qualified dividends received by the Fund, the shareholder must hold its common shares for more
than 61 days during the 121-day period beginning 60 days before the ex-dividend date for the Fund’s common shares (or, in
the case of preferred stock, more than 91 days during the 181-day period beginning 90 days before the ex-dividend date for the
Fund’s preferred shares). Consequently, short-term investors in the Fund may not realize the benefits of tax-advantaged
qualified dividends. There can be no assurance as to the portion of the Fund’s dividends that will be tax-advantaged.
Foreign
Securities. Subject to the Fund’s other policies including investing at least 25% of its assets in the Utilities
Industry, the Fund may invest without limit in the securities of foreign issuers, which are generally denominated in foreign currencies.
The Fund expects to generally be invested in securities of issuers located in at least three countries, including the United States
and possibly including developing countries. It is anticipated that, under normal market conditions, at least 40% of the Fund’s
assets will be invested in foreign securities. Typically, the Fund will not hold any foreign securities of emerging market issuers
and, if it does, such securities are not expected to comprise more than 10% of the Fund’s managed assets.
The
Investment Adviser believes that investing in foreign securities offers both enhanced investment opportunities and additional
risks beyond those present in U.S. securities. Investing in foreign securities may provide increased diversification by adding
securities from various foreign countries (i) that offer different investment opportunities, (ii) that generally are affected
by different economic trends and (iii) whose stock markets may not be correlated with U.S. markets. At the same time, these opportunities
and trends involve risks that may not be encountered in U.S. investments.
The
following considerations comprise both risks and opportunities not typically associated with investing in U.S. securities: fluctuations
in exchange rates of foreign currencies; possible imposition of exchange control regulations or currency restrictions that would
prevent cash from being brought back to the United States; less public information with respect to issuers of securities; less
government supervision of stock exchanges, securities brokers and issuers of securities; the difficulty in obtaining or enforcing
a court judgment abroad; lack of uniform accounting, auditing and financial reporting standards; lack of uniform settlement periods
and trading practices; less liquidity and frequently greater price volatility in foreign markets than in the United States; possible
imposition of foreign taxes; the possibility of expropriation or confiscatory taxation, seizure or nationalization of foreign
bank deposits or other assets; the adoption of foreign government restrictions and other adverse political, social or diplomatic
developments that could affect investment; sometimes less advantageous legal, operational and financial protections applicable
to foreign sub-custodial arrangements; and the historically lower level of responsiveness of foreign management to shareholder
concerns (such as dividends and return on investment).
The
Fund may purchase sponsored ADRs or U.S. dollar denominated securities of foreign issuers, which will be considered foreign securities
for purposes of the Fund’s investment policies. ADRs are receipts issued by U.S. banks or trust companies in respect of
securities of foreign issuers held on deposit for use in the U.S. securities markets. See “Risk Factors and Special Considerations
— Foreign Securities.”
Income
Securities. Although it is the Fund’s policy to invest in securities of companies in the Utilities Industry to the
extent attractive opportunities are available, the Fund may also invest in income securities other than Utilities Industry securities
that are expected to
The
Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
periodically
accrue or generate income for their holders. Such income securities include (i) fixed income securities such as bonds, debentures,
notes, preferred stock, short-term discounted Treasury Bills or certain securities of the U.S. government sponsored instrumentalities,
as well as money market mutual funds that invest in those securities, which, in the absence of an applicable exemptive order,
will not be affiliated with the Investment Adviser, and (ii) common and preferred stocks of issuers that have historically paid
periodic dividends. Fixed income securities obligate the issuer to pay to the holder of the security a specified return, which
may be either fixed or reset periodically in accordance with the terms of the security. Fixed income securities generally are
senior to an issuer’s common stock and their holders generally are entitled to receive amounts due before any distributions
are made to common stockholders. Common stocks, on the other hand, generally do not obligate an issuer to make periodic distributions
to holders.
The
market value of fixed income securities, especially those that provide a fixed rate of return, may be expected to rise and fall
inversely with interest rates and in general is affected by the credit rating of the issuer, the issuer’s performance and
perceptions of the issuer in the market place. The market value of callable or redeemable fixed income securities may also be
affected by the issuer’s call and redemption rights. In addition, it is possible that the issuer of fixed income securities
may not be able to meet its interest or principal obligations to holders. Further, holders of non-convertible fixed income securities
do not participate in any capital appreciation of the issuer.
The
Fund may also invest in obligations of government sponsored instrumentalities. Unlike non-U.S. government securities, obligations
of certain agencies and instrumentalities of the U.S. government, such as the Government National Mortgage Association, are supported
by the “full faith and credit” of the U.S. government; others, such as those of the Export-Import Bank of the U.S.,
are supported by the right of the issuer to borrow from the U.S. Treasury; others, such as those of the Federal National Mortgage
Association, are supported by the discretionary authority of the U.S. government to purchase the agency’s obligations; and
still others, such as those of the Student Loan Marketing Association, are supported only by the credit of the instrumentality.
No assurance can be given that the U.S. government would provide financial support to U.S. government sponsored instrumentalities
if it is not obligated to do so by law. Although the Fund may invest in all types of obligations of agencies and instrumentalities
of the U.S. government, the Fund currently intends to invest only in obligations that are supported by the “full faith and
credit” of the U.S. government.
The
Fund also may invest in common stock of issuers that have historically paid periodic dividends or otherwise made distributions
to common stockholders. Unlike fixed income securities, dividend payments generally are not guaranteed and so may be discontinued
by the issuer at its discretion or because of the issuer’s inability to satisfy its liabilities. Further, an issuer’s
history of paying dividends does not guarantee that it will continue to pay dividends in the future. In addition to dividends,
under certain circumstances the holders of common stock may benefit from the capital appreciation of the issuer.
Common
stocks represent the residual ownership interest in the issuer and holders of common stock are entitled to the income and increase
in the value of the assets and business of the issuer after all of its debt obligations and obligations to preferred shareholders
are satisfied. Common stocks generally have voting rights. Common stocks fluctuate in price in response to many factors including
historical and prospective earnings of the issuer, the value of its assets, general economic conditions, interest rates, investor
perceptions and market liquidity.
Value
Investing. The Fund’s portfolio manager will use various value methods in managing its assets. In selecting securities
for the Fund, he evaluates the quality of a company’s balance sheet, the level of its cash flows and other measures of a
company’s financial condition and profitability. The portfolio manager may also consider other factors, such as a company’s
unrecognized asset values, its future growth prospects or its turnaround potential following an earnings disappointment or other
business difficulties. The portfolio manager then uses these factors to assess the company’s current worth, basing this
assessment on either what he believes a knowledgeable buyer might pay to acquire the entire company or what he thinks the value
of the company should be in the stock market.
The
Fund’s portfolio manager generally invests in securities of companies that are trading significantly below his estimate
of the company’s current worth in an attempt to reduce the risk of overpaying for such companies. Seeking long term growth
of capital, he also evaluates the prospects for the market price of the company’s securities to increase over a two- to
five-year period toward this estimate.
The
Investment Adviser’s value approach strives to reduce some of the other risks of investing in the securities of smaller
companies (for the Fund’s portfolio taken as a whole) by evaluating other risk factors. For example, its portfolio manager
generally attempts to lessen financial risk by buying companies with strong balance sheets and low leverage.
While
there can be no assurance that this risk-averse value approach will be successful, the Investment Adviser believes that it can
reduce some of the risks of investing.
Although
the Investment Adviser’s approach to security selection seeks to reduce downside risk to the Fund’s portfolio, especially
during periods of broad stock market declines, it may also potentially have the effect of limiting gains in strong up markets.
Risk
Arbitrage. Subject to the Fund’s other policies including investing at least 25% of its assets in the Utilities
Industry, the Fund may invest without limitation in securities pursuant to “risk arbitrage” strategies or in other
investment funds managed pursuant to such strategies. Risk arbitrage investments are made in securities of companies for which
a tender or exchange offer has been made or announced and
The
Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
in
securities of companies for which a merger, consolidation, liquidation or reorganization proposal has been announced if, in the
judgment of the Investment Adviser, there is a reasonable prospect of total return significantly greater than the brokerage and
other transaction expenses involved. Risk arbitrage strategies attempt to exploit merger activity to capture the spread between
current market values of securities and their values after successful completion of a merger, restructuring or similar corporate
transaction. Transactions associated with risk arbitrage strategies typically involve the purchases or sales of securities in
connection with announced corporate actions which may include, but are not limited to, mergers, consolidations, acquisitions,
transfers of assets, tender offers, exchange offers, re-capitalizations, liquidations, divestitures, spin-offs and similar transactions.
However, a merger or other restructuring or tender or exchange offer anticipated by the Fund and in which it holds an arbitrage
position may not be completed on the terms contemplated or within the time frame anticipated, resulting in losses to the Fund.
In
general, securities which are the subject of such an offer or proposal sell at a premium to their historic market price immediately
prior to the announcement of the offer but may trade at a discount or premium to what the stated or appraised value of the security
would be if the contemplated transaction were approved or consummated.
Such
investments may be advantageous when the discount significantly overstates the risk of the contingencies involved; significantly
undervalues the securities, assets or cash to be received by shareholders as a result of the contemplated transaction; or fails
adequately to recognize the possibility that the offer or proposal may be replaced or superseded by an offer or proposal of greater
value. The evaluation of such contingencies requires unusually broad knowledge and experience on the part of the Investment Adviser
which must appraise not only the value of the issuer and its component businesses as well as the assets or securities to be received
as a result of the contemplated transaction but also the financial resources and business motivation behind the offer and/or the
dynamics and business climate when the offer or proposal is in process. Since such investments are ordinarily short term in nature,
they will tend to increase the turnover ratio of the Fund, thereby increasing its brokerage and other transaction expenses. Risk
arbitrage strategies may also involve short selling, options hedging and other arbitrage techniques to capture price differentials.
Forward
Foreign Currency Exchange Contracts. Subject to guidelines of the Board of Trustees, the Fund may enter into forward foreign
currency exchange contracts to protect the value of its portfolio against uncertainty in the level of future currency exchange
rates between a particular foreign currency and the U.S. dollar or between foreign currencies in which its securities are or may
be denominated. The Fund may enter into such contracts on a spot (i.e., cash) basis at the rate then prevailing in the currency
exchange market or on a forward basis by entering into a forward contract to purchase or sell currency. A forward contract on
foreign currency is an obligation to purchase or sell a specific currency at a future date, which may be any fixed number of days
agreed upon by the parties from the date of the contract at a price set on the date of the contract. Forward currency contracts
(i) are traded in a market conducted directly between currency traders (typically, commercial banks or other financial institutions)
and their customers, (ii) generally have no deposit requirements and (iii) are typically consummated without payment of any commissions.
The Fund, however, may enter into forward currency contracts requiring deposits or involving the payment of commissions. The Fund
expects to invest in forward currency contracts for hedging or currency risk management purposes and not in order to speculate
on currency exchange rate movements. The Fund will only enter into forward currency contracts with parties which it believes to
be creditworthy.
In
hedging a specific transaction, the Fund may enter into a forward contract with respect to either the currency in which the transaction
is denominated or another currency deemed appropriate by the Investment Adviser. The amount the Fund may invest in forward currency
contracts is limited to the amount of its aggregate investments in foreign currencies. The use of forward currency contracts may
involve certain risks, including the failure of the counterparty to perform its obligations under the contract, and such use may
not serve as a complete hedge because of an imperfect correlation between movements in the prices of the contracts and the prices
of the currencies hedged or used for cover. The Fund will only enter into forward currency contracts with parties that the Investment
Adviser believes to be creditworthy institutions.
Under
current interpretations of the SEC and its staff under the 1940 Act, the Fund must segregate with its custodian liquid assets,
or engage in other SEC or staff approved measures, to “cover” open positions in certain types of derivative instruments.
The purpose of these requirements is to prevent the Fund from incurring excessive leverage through such instruments. In the case
of futures and forward contracts, for example, that are not required as a result of one or more contractual arrangements to settle
for cash only in an amount equal to the change in value of the contract over its term but rather are, per the terms of the contract,
stated to settle through physical delivery, the Fund must segregate liquid assets equal to such contract’s full notional
value while it has an open long position, or is equal to the market value of the deliverable in the case of an open short position.
For this purpose, the “full notional value” of the contract means the purchase price for the assets underlying the
contract (i.e., in the case of a forward currency contract, the aggregate amount one would pay for the underlying currency). With
respect to contracts that the Fund is contractually obligated to settle for cash in an amount equal to the change in value of
the contract, the Fund needs to segregate liquid assets only in an amount equal to the Fund’s unpaid mark to market obligation
rather than the entire notional amount. This is because the Fund’s maximum potential obligation at that point in time is
its net unpaid mark to market obligation rather than the full notional amount.
The
Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
Restricted
and Illiquid Securities. Subject to the Fund’s other policies including investing at least 25% of its assets in
the Utilities Industry, the Fund may invest without limit in securities for which there is no readily available trading market
or are otherwise illiquid. Illiquid securities include securities legally restricted as to resale, such as commercial paper issued
pursuant to Section 4(a)(2) of the Securities Act and securities eligible for resale pursuant to Rule 144A thereunder. Section
4(a)(2) and Rule 144A securities may, however, be treated as liquid by the Investment Adviser pursuant to procedures adopted by
the Board, which require consideration of factors such as trading activity, availability of market quotations and number of dealers
willing to purchase the security. If the Fund invests in Rule 144A securities, the level of portfolio illiquidity may be increased
to the extent that eligible buyers become uninterested in purchasing such securities.
It
may be difficult to sell such securities at a price representing the fair value until such time as such securities may be sold
publicly. Where registration is required, a considerable period may elapse between a decision to sell the securities and the time
when it would be permitted to sell. Thus, the Fund may not be able to obtain as favorable a price as that prevailing at the time
of the decision to sell. The Fund may also acquire securities through private placements under which it may agree to contractual
restrictions on the resale of such securities. Such restrictions might prevent their sale at a time when such sale would otherwise
be desirable.
Leveraging.
As provided in the 1940 Act and subject to certain exceptions, the Fund may issue senior securities (which may be additional
classes of stock, such as preferred shares, or securities representing debt) so long as its total assets, less certain ordinary
course liabilities, exceed 300% of the amount of the debt outstanding and exceed 200% of the amount of preferred shares and debt
outstanding. The issuance of senior securities would leverage the common shares. The Fund’s participation in certain derivative
transactions that have economic leverage embedded in them, as described below, may also leverage the common shares. Although the
timing and other terms of the offering of senior securities and the terms of the senior securities would be determined by the
Fund’s Board, the Fund expects to primarily invest the proceeds of any senior securities offering in dividend paying or
income producing equity or debt securities. See “Use of Proceeds.”
The
use of leverage magnifies the impact of changes in net asset value, which means that, all else being equal, the use of leverage
results in outperformance on the upside and underperformance on the downside. In addition, if the cost of leverage exceeds the
return on the securities acquired with the proceeds of leverage, the use of leverage will diminish rather than enhance the return
to the Fund. The use of leverage generally increases the volatility of returns to the Fund. Such volatility may increase the likelihood
of the Fund having to sell investments in order to meet its obligations to make distributions on the preferred shares or principal
or interest payments on debt securities, or to redeem preferred shares or repay debt, when it may be disadvantageous to do so.
The Fund’s use of leverage may require it to sell portfolio investments at inopportune times in order to raise cash to redeem
preferred shares or otherwise de-leverage so as to maintain required asset coverage amounts or comply with any mandatory redemption
terms of any outstanding preferred shares. See “Risk Factors and Special Considerations — Leverage Risk.”
In
the event the Fund had both outstanding preferred shares and senior securities representing debt at the same time, the Fund’s
obligations to pay dividends or distributions and, upon liquidation of the Fund, liquidation payments in respect of its preferred
shares would be subordinate to the Fund’s obligations to make any principal and/or interest payments due and owing with
respect to its outstanding senior debt securities. Accordingly, the Fund’s issuance of senior securities representing debt
would have the effect of creating special risks for the Fund’s preferred shareholders that would not be present in a capital
structure that did not include such securities. See “Risk Factors and Special Considerations — Special Risks to Holders
of Fixed Rate Preferred Shares.”
Additionally,
the Fund may enter into derivative transactions that have economic leverage embedded in them. Derivative transactions that the
Fund may enter into and the risks associated with them are described elsewhere in the Prospectus and in the SAI. The Fund cannot
assure you that investments in derivative transactions that have economic leverage embedded in them will result in a higher return
on its common shares.
To
the extent the terms of such transactions obligate the Fund to make payments, the Fund may earmark or segregate cash or liquid
assets in an amount at least equal to the current value of the amount then payable by the Fund under the terms of such transactions
or otherwise cover such transactions in accordance with applicable interpretations of the staff of the SEC. If the current value
of the amount then payable by the Fund under the terms of such transactions is represented by the notional amounts of such investments,
the Fund would segregate or earmark cash or liquid assets having a market value at least equal to such notional amounts, and if
the current value of the amount then payable by the Fund under the terms of such transactions is represented by the market value
of the Fund’s current obligations, the Fund would segregate or earmark cash or liquid assets having a market value at least
equal to such current obligations. To the extent the terms of such transactions obligate the Fund to deliver particular securities
to extinguish the Fund’s obligations under such transactions the Fund may “cover” its obligations under such
transactions by either (i) owning the securities or collateral underlying such transactions or (ii) having an absolute and immediate
right to acquire such securities or collateral without additional cash consideration (or, if additional cash consideration is
required, having earmarked or segregated an appropriate amount of cash or liquid assets). Such earmarking, segregation or cover
is intended to provide the Fund with available assets to satisfy its obligations under such transactions. As a result of such
earmarking, segregation or cover, the Fund’s obligations under such transactions will not be considered senior securities
representing indebtedness for purposes of the 1940 Act, or considered borrowings, but may create leverage for the Fund. To the
extent
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Additional Fund Information (Continued) (Unaudited)
that
the Fund’s obligations under such transactions are not so earmarked, segregated or covered, such obligations may be considered
“senior securities representing indebtedness” under the 1940 Act and therefore subject to the 300% asset coverage
requirement.
These
earmarking, segregation or cover requirements can result in the Fund maintaining securities positions it would otherwise liquidate,
segregating or earmarking assets at a time when it might be disadvantageous to do so or otherwise restrict portfolio management.
Non-Investment
Grade Securities. The Fund may invest up to 10% of its total assets in fixed-income securities rated below investment
grade by recognized statistical rating agencies or unrated securities of comparable quality. The prices of these lower grade securities
are more sensitive to negative developments, such as a decline in the issuer’s revenues or a general economic downturn,
than are the prices of higher grade securities. Securities of below investment grade quality — those securities rated below
“Baa” by Moody’s or below “BBB” by S&P (or unrated securities of comparable quality) —
are predominantly speculative with respect to the issuer’s capacity to pay interest and repay principal when due and therefore
involve a greater risk of default. Securities rated below investment grade commonly are referred to as “junk bonds”
or “high yield” securities and generally pay a premium above the yields of U.S. government securities or securities
of investment grade issuers because they are subject to greater risks than these securities. These risks, which reflect their
speculative character, include the following:
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greater
credit risk and risk of default;
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potentially
greater sensitivity to general economic or industry conditions;
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potential
lack of attractive resale opportunities (illiquidity); and
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additional
expenses to seek recovery from issuers who default.
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addition, the prices of these non-investment grade securities are more sensitive to negative developments, such as a decline in
the issuer’s revenues or a general economic downturn, than are the prices of higher grade securities. Non-investment grade
securities tend to be less liquid than investment grade securities. The market value of non-investment grade securities may be
more volatile than the market value of investment grade securities and generally tends to reflect the market’s perception
of the creditworthiness of the issuer and short term market developments to a greater extent than investment grade securities,
which primarily reflect fluctuations in general levels of interest rates.
Ratings
are relative, subjective, and not absolute standards of quality. Securities ratings are based largely on the issuer’s historical
financial condition and the rating agencies’ analysis at the time of rating. Consequently, the rating assigned to any particular
security is not necessarily a reflection of the issuer’s current financial condition.
The
Fund may purchase securities of companies that are experiencing significant financial or business difficulties, including companies
involved in bankruptcy or other reorganization and liquidation proceedings. Although such investments may result in significant
financial returns to the Fund, they involve a substantial degree of risk. The level of analytical sophistication, both financial
and legal, necessary for successful investments in issuers experiencing significant business and financial difficulties is unusually
high. There can be no assurance that the Fund will correctly evaluate the assets collateralizing its investments or the prospects
for a successful reorganization or similar action. In any reorganization or liquidation proceeding relating to a portfolio investment,
the Fund may lose all or part of its investment or may be required to accept collateral with a value less than the amount of the
Fund’s initial investment.
As
a part of its investments in non-investment grade securities (i.e., subject to the 10% cap), the Fund may invest without limit
in the securities of issuers in default. The Fund invests in securities of issuers in default only when the Investment Adviser
believes that such issuers will honor their obligations and emerge from bankruptcy protection and that the value of such issuers’
securities will appreciate. By investing in the securities of issuers in default, the Fund bears the risk that these issuers will
not continue to honor their obligations or emerge from bankruptcy protection or that the value of these securities will not otherwise
appreciate.
In
addition to using statistical rating agencies and other sources, the Investment Adviser will also perform its own analysis of
issuers in seeking investments that it believes to be underrated (and thus higher yielding) in light of the financial condition
of the issuer. Its analysis of issuers may include, among other things, current and anticipated cash flow and borrowing requirements,
value of assets in relation to historical cost, strength of management, responsiveness to business conditions, credit standing
and current anticipated results of operations. In selecting investments for the Fund, the Investment Adviser may also consider
general business conditions, anticipated changes in interest rates and the outlook for specific industries.
Subsequent
to its purchase by the Fund, an issue of securities may cease to be rated or its rating may be reduced. In addition, it is possible
that statistical rating agencies might change their ratings of a particular issue to reflect subsequent events on a timely basis.
Moreover, such ratings do not assess the risk of a decline in market value. None of these events will require the sale of the
securities by the Fund, although the Investment Adviser will consider these events in determining whether the Fund should continue
to hold the securities.
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Gabelli Global Utility & Income Trust
Additional
Fund Information (Continued) (Unaudited)
Fixed
income securities, including non-investment grade securities and comparable unrated securities, frequently have call or buy-back
features that permit their issuers to call or repurchase the securities from their holders, such as the Fund. If an issuer exercises
these rights during periods of declining interest rates, the Fund may have to replace the security with a lower yielding security,
thus resulting in a decreased return for the Fund.
The
market for non-investment grade and comparable unrated securities has at various times, particularly during times of economic
recession, experienced substantial reductions in market value and liquidity. Past recessions have adversely affected the value
of such securities as well as the ability of certain issuers of such securities to repay principal and pay interest thereon or
to refinance such securities. The market for those securities could react in a similar fashion in the event of any future economic
recession.
Options.
The Fund may purchase or sell, i.e., write, options on securities, securities indices and foreign currencies which are
listed on a national securities exchange or in the OTC market as a means of achieving additional return or of hedging the value
of the Fund’s portfolio. A call option is a contract that, in return for a premium, gives the holder of the option the right
to buy from the writer of the call option the security or currency underlying the option at a specified exercise price at any
time during the term of the option. The writer of the call option has the obligation, upon exercise of the option, to deliver
the underlying security or currency upon payment of the exercise price during the option period. A put option is the reverse of
a call option, giving the holder of the option the right, in return for a premium, to sell the underlying security to the writer,
at a specified price, and obligating the writer to purchase the underlying security from the holder upon exercise of the exercise
price.
If
the Fund has written an option, it may terminate its obligation by effecting a closing purchase transaction. This is accomplished
by purchasing an option of the same series as the option previously written. However, with respect to exchange-traded options,
once the Fund has been assigned an exercise notice, the Fund will be unable to effect a closing purchase transaction. Similarly,
if the Fund is the holder of an option it may liquidate its position by effecting a closing sale transaction on an exchange. This
is accomplished by selling an option of the same series as the option previously purchased. There can be no assurance that either
a closing purchase or sale transaction can be effected when the Fund so desires.
The
Fund will realize a profit from a closing transaction if the price of the transaction is less than the premium received from writing
the option or is more than the premium paid to purchase the option; the Fund will realize a loss from a closing transaction if
the price of the transaction is more than the premium received from writing the option or is less than the premium paid to purchase
the option. Since call option prices generally reflect increases in the price of the underlying security, any loss resulting from
the repurchase of a call option may also be wholly or partially offset by unrealized appreciation of the underlying security,
and any gain resulting from the repurchase of a call option may also be wholly or partially offset by unrealized depreciation
of the underlying security. Other principal factors affecting the market value of a put or a call option include supply and demand,
prevailing interest rates, the current market price and price volatility of the underlying security, and the time remaining until
the expiration date of the option. Gains and losses on investments in options depend, in part, on the ability of the Investment
Adviser to predict correctly the effect of these factors. The use of options cannot serve as a complete hedge since the price
movement of securities underlying the options will not necessarily follow the price movements of the portfolio securities subject
to the hedge.
An
option position may be closed out only on an exchange which provides a secondary market for an option of the same series or in
a private transaction. Although the Fund will generally purchase or write only those options for which there appears to be an
active secondary market, there is no assurance that a liquid secondary market on an exchange will persist for any particular option.
In such event, it might not be possible to effect closing transactions in particular options, so that the Fund would have to exercise
its options in order to realize any profit and would incur brokerage commissions upon the exercise of call options and upon the
subsequent disposition of underlying securities for the exercise of put options. If the Fund, as a covered call option writer,
is unable to effect a closing purchase transaction in a secondary market, it will not be able to sell the underlying security
until the option expires or it delivers the underlying security upon exercise or otherwise covers the position.
The
sale of covered call options may also be used by the Fund to reduce the risks associated with individual investments and to increase
total investment return. A call option is “covered” if the Fund owns the underlying instrument covered by the call
or has an absolute and immediate right to acquire that instrument without additional cash consideration (or for additional cash
consideration held in a segregated account by its custodian) upon conversion or exchange of other instruments held in its portfolio.
A call option is also covered if the Fund holds a call option on the same instrument as the call option written where the exercise
price of the call option held is (i) equal to or less than the exercise price of the call option written or (ii) greater than
the exercise price of the call option written if the difference is maintained by the Fund in cash, U.S. government securities
or other high-grade short term obligations in a segregated account with its custodian. A put option is “covered” if
the Fund maintains cash or other liquid securities with a value equal to the exercise price in a segregated account with its custodian,
or else holds a put option on the same instrument as the put option written where the exercise price of the put option held is
equal to or greater than the exercise price of the put option written.
To
the extent that the Fund purchases options pursuant to a hedging strategy, the Fund will be subject to the following additional
risks.
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Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
If
a put or call option purchased by the Fund is not sold when it has remaining value, and if the market price of the underlying
security remains equal to or greater than the exercise price (in the case of a put), or remains less than or equal to the exercise
price (in the case of a call), the Fund will lose its entire investment in the option.
Where
a put or call option on a particular security is purchased to hedge against price movements in that or a related security, the
price of the put or call option may move more or less than the price of the security. If restrictions on exercise are imposed,
the Fund may be unable to exercise an option it has purchased. If the Fund is unable to close out an option that it has purchased
on a security, it will have to exercise the option in order to realize any profit, or the option may expire worthless.
Futures
Contracts and Options on Futures. The Fund may purchase and sell financial futures contracts and options thereon which
are traded on a commodities exchange or board of trade for certain hedging, yield enhancement and risk management purposes. A
financial futures contract is an agreement to purchase or sell an agreed amount of securities or currencies at a set price for
delivery in the future. These futures contracts and related options may be on debt securities, financial indices, securities indices,
U.S. government securities and foreign currencies. The Investment Adviser has claimed an exclusion from the definition of the
term “commodity pool operator” under the Commodity Exchange Act.
When
Issued, Delayed Delivery Securities and Forward Commitments. The Fund may enter into forward commitments for the purchase
or sale of securities, including on a “when issued” or “delayed delivery” basis, in excess of customary
settlement periods for the type of security involved. In some cases, a forward commitment may be conditioned upon the occurrence
of a subsequent event, such as approval and consummation of a merger, corporate reorganization or debt restructuring (i.e., a
when, as and if issued security). When such transactions are negotiated, the price is fixed at the time of the commitment, with
payment and delivery taking place in the future, generally a month or more after the date of the commitment. While it will only
enter into a forward commitment with the intention of actually acquiring the security, the Fund may sell the security before the
settlement date if it is deemed advisable by the Investment Adviser.
Securities
purchased under a forward commitment are subject to market fluctuation, and no interest (or dividends) accrues to the Fund prior
to the settlement date. The Fund will segregate with its custodian cash or other liquid assets in an aggregate amount at least
equal to the amount of its outstanding forward commitments.
Short
Sales. The Fund may make short sales of securities. A short sale is a transaction in which the Fund sells a security it
does not own in anticipation that the market price of that security will decline. The market value of the securities sold short
of any one issuer will not exceed either 10% of the Fund’s total assets or 5% of such issuer’s voting securities.
The Fund also will not make a short sale, if, after giving effect to such sale, the market value of all securities sold short
exceeds 25% of the value of its total assets or the Fund’s aggregate short sales of a particular class of securities exceeds
25% of the outstanding securities of that class. The Fund may also make short sales “against the box” without respect
to such limitations. In this type of short sale, at the time of the sale, the Fund owns, or has the immediate and unconditional
right to acquire at no additional cost, the identical security.
The
Fund expects to make short sales both to obtain capital gains from anticipated declines in securities and as a form of hedging
to offset potential declines in long positions in the same or similar securities. The short sale of a security is considered a
speculative investment technique. Short sales “against the box” may be subject to special tax rules, one of the effects
of which may be to accelerate income to the Fund.
When
the Fund makes a short sale, it must borrow the security sold short and deliver it to the broker-dealer through which it made
the short sale in order to satisfy its obligation to deliver the security upon conclusion of the sale. The Fund may have to pay
a fee to borrow particular securities and is often obligated to deliver any payments received on such borrowed securities, such
as dividends.
If
the price of the security sold short increases between the time of the short sale and the time the Fund replaces the borrowed
security, the Fund will incur a loss; conversely, if the price declines, the Fund will realize a capital gain. Any gain will be
decreased, and any loss will be increased, by the transaction costs incurred by the Fund, including the costs associated with
providing collateral to the broker-dealer (usually cash, U.S. government securities or other highly liquid debt securities) and
the maintenance of collateral with its custodian. Although the Fund’s gain is limited to the price at which it sold the
security short, its potential loss is theoretically unlimited.
Other
Derivative Instruments. The Fund may also utilize other types of derivative instruments, primarily for hedging or risk
management purposes. These instruments include futures, forward contracts, options on such contracts and interest rate, total
return and other kinds of swaps. These investment management techniques generally will not be considered senior securities if
the Fund establishes in a segregated account cash or other liquid securities, sets aside assets on its accounting records equal
to the Fund’s obligations in respect of such transactions or techniques or enters into an offsetting position. For a further
description of such derivative instruments, see “Investment Objective and Policies — Additional Investment Policies”
in the SAI.
Limitations
on the Purchase and Sale of Futures Contracts, Certain Options, and Swaps. Subject to the guidelines of the Board, the
Fund may engage in “commodity interest” transactions (generally, transactions in futures, certain options, certain
currency transactions, and certain types of swaps) only for bona fide hedging or other permissible transactions in accordance
with the rules and regulations of
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Gabelli Global Utility & Income Trust
Additional
Fund Information (Continued) (Unaudited)
the
Commodity Futures Trading Commission (“CFTC”). Pursuant to amendments by the CFTC to Rule 4.5 under the Commodity
Exchange Act (“CEA”), the Investment Adviser has filed a notice of exemption from registration as a “commodity
pool operator” with respect to the Fund. The Fund and the Investment Adviser are therefore not subject to registration or
regulation as a commodity pool operator under the CEA. In addition, certain trading restrictions are applicable to the Fund as
a result of this status. These trading restrictions permit the Fund to engage in commodity interest transactions that include
(i) “bona fide hedging” transactions, as that term is defined and interpreted by the CFTC and its staff, without regard
to the percentage of the Fund’s assets committed to margin and options premiums and (ii) non-bona fide hedging transactions,
provided that the Fund does not enter into such non-bona fide hedging transactions if, immediately thereafter, either (a) the
sum of the amount of initial margin deposits on the Fund’s existing futures positions or swaps positions and option or swaption
premiums would exceed 5% of the market value of the Fund’s liquidating value, after taking into account unrealized profits
and unrealized losses on any such transactions, or (b) the aggregate net notional value of the Fund’s commodity interest
transactions would not exceed 100% of the market value of the Fund’s liquidating value, after taking into account unrealized
profits and unrealized losses on any such transactions. In addition to meeting one of the foregoing trading limitations, the Fund
may not market itself as a commodity pool or otherwise as a vehicle for trading in the futures, options or swaps markets. Therefore,
in order to claim the Rule 4.5 exemption, the Fund is limited in its ability to invest in commodity futures, options, and certain
types of swaps (including securities futures, broad based stock index futures, and financial futures contracts). As a result,
the Fund is more limited in its ability to use these instruments than in the past, and these limitations may have a negative impact
on the ability of the Investment Adviser to manage the Fund, and on the Fund’s performance. If the Investment Adviser was
required to register as a commodity pool operator with respect to the Fund, compliance with additional registration and regulatory
requirements would increase Fund expenses. Other potentially adverse regulatory initiatives could also develop.
Risks
of Currency Transactions. Currency transactions are also subject to risks different from those of other portfolio transactions.
Because currency control is of great importance to the issuing governments and influences economic planning and policy, purchases
and sales of currency and related instruments can be adversely affected by government exchange controls, limitations or restrictions
on repatriation of currency, and manipulation, or exchange restrictions imposed by governments. These forms of governmental action
can result in losses to the Fund if it is unable to deliver or receive currency or monies in settlement of obligations and could
also cause hedges it has entered into to be rendered useless, resulting in full currency exposure and incurring transaction costs.
Repurchase
Agreements. Repurchase agreements may be seen as loans by the Fund collateralized by underlying debt securities. Under
the terms of a typical repurchase agreement, the Fund would acquire an underlying debt obligation for a relatively short period
(usually not more than one week) subject to an obligation of the seller to repurchase, and the Fund to resell, the obligation
at an agreed price and time. This arrangement results in a fixed rate of return to the Fund that is not subject to market fluctuations
during the holding period. The Fund bears a risk of loss in the event that the other party to a repurchase agreement defaults
on its obligations and the Fund is delayed in or prevented from exercising its rights to dispose of the collateral securities,
including the risk of a possible decline in the value of the underlying securities during the period in which it seeks to assert
these rights. The Investment Adviser, acting under the supervision of the Board of Trustees, reviews the creditworthiness of those
banks and dealers with which the Fund enters into repurchase agreements to evaluate these risks and monitors on an ongoing basis
the value of the securities subject to repurchase agreements to ensure that the value is maintained at the required level. The
Fund will not enter into repurchase agreements with the Investment Adviser or any of its affiliates.
Swaps.
The Fund may enter into total rate of return, credit default or other types of swaps and related derivatives for various purposes,
including to gain economic exposure to an asset or group of assets that may be difficult or impractical to acquire or for hedging
and risk management. These transactions generally provide for the transfer from one counterparty to another of certain risks inherent
in the ownership of a financial asset such as a common stock or debt instrument. Such risks include, among other things, the risk
of default and insolvency of the obligor of such asset, the risk that the credit of the obligor or the underlying collateral will
decline or the risk that the common stock of the underlying issuer will decline in value. The transfer of risk pursuant to a derivative
of this type may be complete or partial, and may be for the life of the related asset or for a shorter period. These derivatives
may be used as a risk management tool for a pool of financial assets, providing the Fund with the opportunity to gain or reduce
exposure to one or more reference securities or other financial assets (each, a “Reference Asset”) without actually
owning or selling such assets in order, for example, to increase or reduce a concentration risk or to diversify a portfolio. Conversely,
these derivatives may be used by the Fund to reduce exposure to an owned asset without selling it.
Because
the Fund would not own the Reference Assets, the Fund may not have any voting rights with respect to the Reference Assets, and
in such cases all decisions related to the obligors or issuers of the Reference Assets, including whether to exercise certain
remedies, will be controlled by the swap counterparties.
Total
rate of return swap agreements are contracts in which one party agrees to make periodic payments to another party based on the
change in market value of the assets underlying the contract, which may include a specified security, basket of securities or
securities indices during the specified period, in return for periodic payments based on a fixed or variable interest rate or
the total return from other underlying assets.
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Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
A
credit default swap consists of an agreement between two parties in which the “buyer” agrees to pay to the “seller”
a periodic stream of payments over the term of the contract and the seller agrees to pay the buyer the par value (or other agreed-upon
value) of a referenced debt obligation upon the occurrence of a credit event with respect to the issuer of the referenced debt
obligation. Generally, a credit event means bankruptcy, failure to pay, obligation acceleration or modified restructuring. The
Fund may be either the buyer or seller in a credit default swap. As the buyer in a credit default swap, the Fund would pay to
the counterparty the periodic stream of payments. If no default occurs, the Fund would receive no benefit from the contract. As
the seller in a credit default swap, the Fund would receive the stream of payments but would be subject to exposure on the notional
amount of the swap, which it would be required to pay in the event of a credit event with respect to the issuer of the referenced
debt obligation. Accordingly, if the Fund sells a credit default swap (or a credit default index swap), it intends at all times
to segregate or designate on its books and records liquid assets in an amount at least equal to the notional amount of the swap
(i.e., the cost of payment to the buyer if a credit event occurs).
The
Fund may also enter into equity contract for difference swap transactions. In an equity contract for difference swap, a set of
future cash flows is exchanged between two counterparties. One of these cash flow streams will typically be based on a reference
interest rate combined with the performance of a notional value of shares of a stock. The other will be based on the performance
of the shares of a stock. Depending on the general state of short term interest rates and the returns on the Fund’s portfolio
securities at the time an equity contract for difference swap transaction reaches its scheduled termination date, there is a risk
that the Fund will not be able to obtain a replacement transaction or that the terms of the replacement will not be as favorable
as on the expiring transaction.
Total
rate of return swaps and similar derivatives are subject to many risks, including the possibility that the market will move in
a manner or direction that would have resulted in gain for the Fund had the swap or other derivative not been utilized (in which
case it would have been better had the Fund not engaged in the hedging transactions), the risk of imperfect correlation between
the risk sought to be hedged and the derivative transactions utilized, the possible inability of the counterparty to fulfill its
obligations under the swap and potential illiquidity of the hedging instrument utilized, which may make it difficult for the Fund
to close out or unwind one or more hedging transactions.
Total
rate of return swaps and related derivatives are a relatively recent development in the financial markets. Consequently, there
are certain legal, tax and market uncertainties that present risks in entering into such arrangements.
There
is currently little or no case law or litigation characterizing total rate of return swaps or related derivatives, interpreting
their provisions, or characterizing their tax treatment. In addition, additional regulations and laws may apply to these types
of derivatives that have not previously been applied. There can be no assurance that future decisions construing similar provisions
to those in any swap agreement or other related documents or additional regulations and laws will not have an adverse effect on
the Fund that utilizes these instruments. The Fund will monitor these risks and seek to utilize these instruments in a manner
that does not lead to undue risk regarding the tax or other structural elements of the Fund. The Fund will not invest in these
types of instruments if the Reference Assets are commodities except for bona fide hedging or risk management purposes.
Convertible
Securities. A convertible security is a bond, debenture, note, stock or other similar security that may be converted into
or exchanged for a prescribed amount of common stock or other equity security of the same or a different issuer within a particular
period of time at a specified price or formula. Before conversion, convertible securities have characteristics similar to non-convertible
debt securities in that they ordinarily provide a stream of income with generally higher yields than those of common stock of
the same or similar issuers. Convertible securities are senior in rank to common stock in a corporation’s capital structure
and, therefore, generally entail less risk than the corporation’s common stock, although the extent to which such risk is
reduced depends in large measure upon the degree to which the convertible security sells above its value as a fixed income security.
See “Risk Factors and Special Considerations — Convertible Securities Risk.”
Temporary
Defensive Investments. Although under normal market conditions at least 80% of the Fund’s assets will consist of
common stock and other debt or equity securities of foreign and domestic companies involved in the Utilities Industry and securities
of companies in other industries that are expected to periodically generate or accrue income, when a temporary defensive posture
is believed by the Investment Adviser to be warranted (“temporary defensive periods”), the Fund may without limitation
hold cash or invest its assets in money market instruments and repurchase agreements in respect of those instruments. The money
market instruments in which the Fund may invest are obligations of the U.S. government, its agencies or instrumentalities; commercial
paper rated A-1 or higher by S&P or Prime-1 by Moody’s; and certificates of deposit and bankers’ acceptances issued
by domestic branches of U.S. banks that are members of the Federal Deposit Insurance Corporation. During temporary defensive periods,
the Fund may also invest to the extent permitted by applicable law in shares of money market mutual funds. Money market mutual
funds are investment companies and the investments in those companies by the Fund are in some cases subject to applicable law.
See “Investment Restrictions” in the SAI. As a shareholder in a mutual fund, the Fund will bear its ratable share
of its expenses, including management fees, and will remain subject to payment of the fees to the Investment Adviser, with respect
to assets so invested. See “Management of the Fund — General.” The Fund may find it more difficult to achieve
the long term growth of capital component of its investment objective during temporary defensive periods.
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Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
Loans
of Portfolio Securities. To increase income, the Fund may lend its portfolio securities to securities broker-dealers or
financial institutions if the loan is collateralized in accordance with applicable regulatory requirements.
If
the borrower fails to maintain the requisite amount of collateral, the loan automatically terminates and the Fund could use the
collateral to replace the securities while holding the borrower liable for any excess of replacement cost over the value of the
collateral. As with any extension of credit, there are risks of delay in recovery and in some cases even loss of rights in collateral
should the borrower of the securities violate the terms of the loan or fail financially. There can be no assurance that borrowers
will not fail financially. On termination of the loan, the borrower is required to return the securities to the Fund, and any
gain or loss in the market price during the loan would inure to the Fund. If the other party to the loan petitions for bankruptcy
or becomes subject to the United States Bankruptcy Code, the law regarding the rights of the Fund is unsettled. As a result, under
extreme circumstances, there may be a restriction on the Fund’s ability to sell the collateral and the Fund would suffer
a loss. See “Investment Objective and Policies — Loans of Portfolio Securities” in the SAI.
Investment
Restrictions. The Fund has adopted certain investment restrictions as fundamental policies of the Fund. Under the 1940
Act, a fundamental policy may not be changed without the vote of a majority, as defined in the 1940 Act, of the outstanding voting
securities of the Fund (voting together as a single class). In addition, pursuant to the Fund’s Series A Preferred Statement
of Preferences, a majority, as defined in the 1940 Act, of the outstanding preferred shares of the Fund (voting separately as
a single class) is also required to change a fundamental policy. See “Investment Restrictions” in the SAI. The Fund
may become subject to rating agency guidelines that are more limiting than its current investment restrictions in order to obtain
and maintain a desired rating on its preferred shares, if any.
Neither
the Fund’s investment objective nor, except as expressly listed under “Investment Restrictions” in the SAI,
any of its policies, is fundamental, and each may be modified by the Board without shareholder approval.
Portfolio
Turnover. Portfolio turnover generally involves expense to the Fund, including brokerage commissions or dealer mark-ups
and other transaction costs on the sale of securities and reinvestment in other securities. The portfolio turnover rate is computed
by dividing the lesser of the amount of the securities purchased or securities sold by the average monthly value of securities
owned during the year (excluding securities whose maturities at acquisition were one year or less). Higher portfolio turnover
may decrease the after-tax return to individual investors in the Fund to the extent it results in a decrease of the long-term
capital gains portion of distributions to shareholders.
RISK
FACTORS AND SPECIAL CONSIDERATIONS
Investors
should consider the following risk factors and special considerations associated with investing in the Fund:
Industry
Risks
The
Fund invests in foreign and domestic companies involved in the Utilities Industry and, as a result, the value of the common shares
will be more susceptible to factors affecting those particular types of companies, including governmental regulation, inflation,
cost increases in fuel and other operating expenses, technological innovations that may render existing products and equipment
obsolete and increasing interest rates resulting in high interest costs on borrowings needed for product development, infrastructure
and capital construction programs, including costs associated with compliance with environmental and other regulations.
Sector
Risk. The Fund concentrates its investments in the Utilities Industry. As a result, the Fund’s investments may be
subject to greater risk and market fluctuation than a fund that had securities representing a broader range of investment alternatives.
The prices of equity securities issued by certain types of utility companies may change more in response to interest rate changes
than the equity securities of other companies. Generally, when interest rates go up, the value of securities issued by these companies
goes down. Conversely, when interest rates go down, the value of securities issued by these companies goes up. There is no guarantee
that this relationship will hold in the future. Privatization in the Utilities Industry may subject companies to greater competition
and losses in profitability. Companies in the Utilities Industry may have difficulty obtaining an adequate return on invested
capital, raising capital, or financing large construction programs during periods of inflation or unsettled capital markets.
Government
Regulation. Companies in certain sectors of the Utilities Industry (such as power generation and distribution) are subject
to extensive governmental regulatory requirements. In the United States, most companies in the Utilities Industry are regulated
by state and/or federal authorizes. For example, at the federal level in the United States, the Federal Energy Regulatory Commission
(“FERC”), the Federal Trade Commission (“FTC”), the SEC and the Nuclear Regulatory Commission (“NRC”)
have authority to oversee electric and combination electric and gas utilities. Certain of these regulations that are intended
to limit the concentration of ownership and control of companies in these industries may prevent companies in which the Fund invests
from making certain investments that they would otherwise make. Other regulations may cause Utilities Industry companies to incur
substantial additional costs or lengthy delays in connection with the completion of capital investments or the introduction of
new products or services to market. There are substantial differences between the regulatory practices and policies in various
jurisdictions, and any given regulatory agency may make major shifts in policy from time to time. There is no assurance that regulatory
authorities will, in the future, permit companies to implement rate increases or that such
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Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
increases
will be adequate to permit the payment of dividends on such issuer’s common stocks. Additionally, existing and possible
future regulatory legislation may make it even more difficult for companies in the Utilities Industry to obtain adequate relief
from rate regulation.
Regulatory
considerations limit the percentage of the shares of a public utility or utility holding company held by a fund or by an adviser
and its affiliates on behalf of all their clients. In particular, approval of the FERC under the Federal Power Act would generally
be required for (i) the Fund to acquire and hold 10% or more of the voting securities of any publicly traded public utility or
utility holding company, and (ii) for the Fund together with any affiliated fund or other affiliated entity to acquire and hold
in the aggregate 20% or more of the voting securities of any publicly traded public utility or utility holding company. Other
requirements for FERC or state utility commission approval of the acquisition of voting securities may apply as well. Apart from
approval requirements with respect to acquisitions of voting securities, the Fund may choose to limit its ownership of public
utility or utility holding company voting securities in order to avoid the imposition of regulatory requirements under federal
or state law such as those that attend status as a “holding company” under the Public Utility Holding Company Act
of 2005.
Similarly,
various types of ownership restrictions are imposed by the Federal Communications Commission (“FCC”), on investment
in media companies and cellular licensees. For example, the FCC’s broadcast and cable multiple-ownership and cross ownership
rules, which apply to the radio, television, and cable industries, provide that investment advisers are deemed to have an “attributable”
interest whenever the adviser has the right to determine how five percent or more of the issued and outstanding voting stock of
a broadcast company or cable system operator may be voted. These rules limit the number of broadcast stations both locally and
nationally that a single entity is permitted to own, operate, or control and prohibit ownership of certain competitive communications
providers in the same location. The FCC also applies limited ownership restrictions on cellular licensees serving rural areas.
An attributable interest in a cellular company arises from the right to control 20% or more of its voting stock. Attributable
interests that may result from the role of the Investment Adviser and its principals in connection with other funds, managed accounts
and companies may limit the Fund’s ability to invest in certain mass media and cellular companies. These limitations may
unfavorably restrict the ability of the Fund to make certain investments.
Deregulation.
Changing regulation constitutes one of the key industry-specific risks for the Fund, especially with respect to its investments
in traditionally regulated public utilities and partially regulated utility or telecommunications companies. Domestic and foreign
regulators may monitor and control such companies’ revenues and costs, and therefore may limit utility profits and dividends
paid to investors, which could result in reduced income to the Fund. Regulatory authorities also may restrict a company’s
access to new markets, thereby diminishing the company’s long-term prospects. In some jurisdictions certain portions of
various utilities functions have been deregulated. Deregulation may eliminate restrictions on profits and dividends of companies,
but may also subject these companies to greater risks of loss. Thus, deregulation could have a positive or negative impact on
the Fund. The Investment Adviser believes that certain Utilities Industry companies’ fundamentals should continue to improve
as the industry undergoes deregulation. The nature of regulation of the Utilities Industry continues to evolve both in the United
States and in foreign countries. In recent years, changes in regulation in the United States increasingly have allowed companies
in the Utilities Industry to provide services and products outside their traditional geographic areas and lines of business, creating
new areas of competition within these industries. In some instances, companies in the Utilities Industry are operating on an unregulated
basis. However, a number of companies have failed in their efforts to take advantage of the deregulated environment and are seeking
to refocus in their primary business. Nonetheless, because of trends toward deregulation and the evolution of independent producers
as well as new entrants to the field of telecommunications, non-regulated providers of utility and telecommunications services
have become a significant part of their respective industries. The emergence of competition and deregulation may result in certain
companies in the Utilities Industry being able to earn more than their traditional regulated rates of return, while others may
be forced to defend their core business from increased competition and may be less profitable. Reduced profitability, as well
as new uses of funds (such as for expansion, operations or stock buybacks) could result in cuts in dividend payout rates. The
Investment Adviser seeks to take advantage of favorable investment opportunities that may arise from these structural changes.
Of course, there can be no assurance that favorable developments will occur in the future.
Environmental
and Other Regulatory Matters. Companies in the Utilities Industry in which the Fund will invest may be subject to a number
of host country statutory and regulatory standards and required approvals relating to energy, labor and environmental laws. Certain
permits and regulatory approvals may be required to be obtained for certain investments by companies in which the Fund will invest
and failure by such companies to obtain such permits and regulatory approvals could adversely affect the Fund’s investment.
Companies also face considerable costs associated with environmental compliance, nuclear waste clean-up and safety regulation.
Increasingly, regulators are calling upon electric utilities to bear these added costs, and there is a risk that these costs will
not be fully recovered through an increase in revenues.
The
adoption by a host country of new laws, policies or regulations or changes in the interpretation or application of existing laws,
policies and regulations that modify the present regulatory environment could also have an adverse effect on the Fund’s
investments. Regulatory risk affects companies in the Utilities Industry in part because governments may be party to private Utilities
Industry investments as lessors, customers, regulators or partners. Moreover, for political reasons, governments may control the
prices at which companies in the Utilities Industry can sell their products, which can adversely affect the Fund’s investment
in such a company.
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Under
the laws of certain countries that are host to Utilities Industry companies in which the Fund may invest, such companies may be
required to comply with a number of statutes and regulations during their operation pertaining to environmental controls or restrictions,
and the storage, handling, transportation and disposal of hazardous and toxic material, waste or other substances. Compliance
with such requirements may be costly and may materially affect the profitability of such companies. For example, governments have
been increasing their attention to issues related to greenhouse gas (“GHG”) emissions and climate change, and regulatory
measures to limit or reduce GHG emissions are currently in various stages of discussion or implementation. GHG emissions-related
regulations could substantially harm energy companies, including by reducing the demand for energy fuels and increasing compliance
costs. Failure by such a company to comply with any such statutes or regulations could have adverse effects on its business results
and prospects, which could have negative consequences for investors such as the Fund.
Foreign
Utility Companies. Foreign companies in the Utilities Industry are also subject to regulation, although such regulation
may or may not be comparable to regulation in the United States. Foreign companies in the Utilities Industry may be more heavily
regulated by their respective governments than companies in the United States and, as in the United States, generally are required
to seek government approval for rate increases. In addition, many foreign utilities use fuels that may cause more pollution than
those used in the United States, which may require such utilities to invest in pollution control equipment to meet any proposed
pollution restrictions. Foreign regulatory systems vary from country to country and may evolve in ways different from regulation
in the United States. Additionally, because the effectiveness of the judicial systems in non-U.S. countries varies, the Fund or
companies in which it may invest may have difficulty in successfully pursuing claims in the courts of such countries.
Privatization,
which refers to the trend toward investor ownership of assets rather than government ownership, is expected to occur in newer,
faster-growing economies and in mature economies. Of course, there is no assurance that such favorable developments will occur
or that investment opportunities in foreign markets will increase. The revenues of domestic and foreign utility companies generally
reflect the economic growth and development in the geographic areas in which they do business.
Financing.
At certain times, including during inflationary periods, companies in the Utilities Industry encounter difficulties in
obtaining financing for product development, infrastructure and construction programs. Issuers experiencing such difficulties
may also experience lower profitability, which can result in reduced income to the Fund. Historically, companies in the Utilities
Industry have also encountered such financing difficulties during inflationary periods, although we cannot assure you that such
a relationship will continue and that companies in the Utilities Industry will not encounter financing difficulties during non-inflationary
periods.
Equipment
and Supplies. Companies in the Utilities Industry may face the risk of lengthy delays and increased costs associated with
the design, development, construction, licensing and operation of their facilities or sale of their products. Moreover, technological
innovations may render existing plants, equipment or products obsolete.
Increased
costs and a reduction in the availability of fuel (such as oil, coal, nuclear or natural gas) also may adversely affect the profitability
of utility companies. Electric utilities may be burdened by unexpected increases in fuel and other operating costs. They may also
be negatively affected when long-term interest rates rise. Long-term borrowings are used to finance most utility investments,
and rising interest rates lead to higher financing costs and reduced earnings. Investments in certain kinds of utility companies
are also subject to certain additional risks.
Electric.
Certain of the issuers of securities held in the Fund’s portfolio may own or operate nuclear generating facilities.
Governmental authorities may from time to time review existing policies and impose additional requirements governing the licensing,
construction and operation of nuclear power plants. In the past, nuclear generating projects in the electric utility industry
have experienced substantial cost increases, construction delays and licensing difficulties. These have been caused by various
factors, including inflation, high financing costs, required design changes and rework, allegedly faulty construction, objections
by groups and governmental officials, limits on the ability to obtain financing, reduced forecasts of energy requirements and
economic conditions. This experience indicates that the risk of significant cost increases, delays and licensing difficulties
remain present until completion and achievement of commercial operation of any nuclear project. Also, nuclear generating units
in service have experienced unplanned outages or extensions of scheduled outages due to equipment problems or new regulatory requirements
sometimes followed by a significant delay in obtaining regulatory approval to return to service. A major accident at a nuclear
plant anywhere could cause the imposition of limits or prohibitions on the operation, construction or licensing of nuclear units.
Prolonged changes in climatic conditions can also have a significant impact on both the revenues of an electric and gas utility
as well as its expenses.
The
construction and operation of nuclear power facilities are subject to strict scrutiny by, and evolving regulations of, the Nuclear
Regulatory Commission and state agencies which have comparable jurisdiction. Strict scrutiny might result in higher operating
costs and higher capital expenditures, with the risk that the regulators may disallow inclusion of these costs in rate authorizations
or the risk that a company may not be permitted to operate or complete construction of a facility. In addition, operators of nuclear
power plants may be subject to significant costs for disposal of nuclear fuel and for decommissioning such plants.
The
rating agencies look closely at the business profile of utilities. Ratings for companies are expected to be affected to a greater
extent
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in
the future by how their asset base is utilized. Electric utility companies that focus more on the generation of electricity may
be assigned less favorable ratings as this business is expected to be competitive and the least regulated. On the other hand,
companies that focus on transmission and distribution, which is expected to be the least competitive and the more regulated part
of the business, may see higher ratings given the greater predictability of cash flow.
A
number of states are considering or have enacted deregulation proposals. The introduction of competition into the industry as
a result of such deregulation has at times resulted in lower revenue, lower credit ratings, increased default risk, and lower
electric utility security prices. Such increased competition may also cause long-term contracts, which electric utilities previously
entered into to buy power, to become “stranded assets” which have no economic value.
Any
loss associated with such contracts must be absorbed by ratepayers and investors. In addition, some electric utilities have acquired
electric utilities overseas to diversify, enhance earnings and gain experience in operating in a deregulated environment. In some
instances, such acquisitions have involved significant borrowings, which have burdened the acquirer’s balance sheet. There
is no assurance that current deregulation proposals will be adopted. However, deregulation in any form could significantly impact
the electric utilities industry.
Following
deregulation of the energy markets in certain states, a number of companies have engaged in energy trading and incurred substantial
losses. Certain of these energy trading businesses have been accused of employing improper accounting practices and have been
required to make significant restatements of their financial results. In addition, several energy companies have been accused
of attempting to manipulate the price and availability of energy in certain states.
Telecommunications.
The telecommunications industry today includes both traditional telephone companies with a history of broad market coverage
and highly regulated businesses and cable companies, which began as small, lightly regulated businesses focused on limited markets.
Today these two historically different businesses are converging in an industry which is trending toward larger, competitive,
national and international markets with an emphasis on deregulation. Companies that distribute telephone services and provide
access to the telephone networks still comprise the greatest portion of this segment, but non-regulated activities such as cellular
telephone services, paging, data processing, equipment retailing, computer software and hardware services are becoming increasingly
significant components as well. The presence of unregulated companies in this industry and the entry of traditional telephone
companies into unregulated or less regulated businesses provide significant investment opportunities with companies which may
increase their earnings at faster rates than had been allowed in traditional regulated businesses. Still, increasing competition,
technological innovations and other structural changes could adversely affect the profitability of such utilities and the growth
rate of their dividends. Given mergers and proposed legislation and enforcement changes, it is likely that both traditional telephone
companies and cable companies will continue to provide an expanding range of utility services to residential, corporate and governmental
customers.
Gas.
Gas transmission companies and gas distribution companies are also undergoing significant changes. In the United States, interstate
transmission companies are regulated by the FERC, which is reducing its regulation of the industry. Many companies have diversified
into oil and gas exploration and development, making returns more sensitive to energy prices. In the recent decade, gas utility
companies have been adversely affected by disruptions in the oil industry, including related to political conditions in oil producing
regions (such as the Middle East), and have also been affected by increased concentration and competition. Prolonged changes in
climatic conditions can also have a significant impact on both the revenues and expenses of a gas utility. Natural gas is the
cleanest of the hydrocarbon fuels, and this may result in incremental shifts in fuel consumption toward natural gas and away from
oil and coal, even for electricity generation. However, technological or regulatory changes within the industry may delay or prevent
this result.
Water.
In the case of the water utility sector, the industry is highly fragmented, and most water supply companies find themselves
in mature markets, although upgrading of fresh water and waste water systems is an expanding business.
Utilities
Industry Generally. There can be no assurance that the positive developments noted above, including those relating to
privatization and changing regulation, will occur or that risk factors other than those noted above will not develop in the future.
Moreover,
price disparities within selected utility groups and discrepancies in relation to averages and indices have occurred frequently
for reasons not directly related to the general movements or price trends of utility common stocks. Causes of these discrepancies
include changes in the overall demand for and supply of various securities (including the potentially depressing effect of new
stock offerings), and changes in investment objectives, market expectations or cash requirements of other purchasers and sellers
of securities.
Leveraged
Capital Structures. It is expected that Utilities Industry companies in which the Fund will invest may employ considerable
leverage, a significant portion of which may be at floating interest rates. As a result, a Utilities Industry company may be subject
to increased exposure to adverse economic factors such as a significant rise in interest rates, a severe downturn in the economy
or deterioration in the condition of such company or its industry.
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General
Risks
Equity
Risk. Investing in the Fund involves equity risk, which is the risk that the securities held by the Fund will fall in
market value due to adverse market and economic conditions, perceptions regarding the industries in which the issuers of securities
held by the Fund participate and the particular circumstances and performance of particular companies whose securities the Fund
holds. An investment in the Fund represents an indirect economic stake in the securities owned by the Fund, which are for the
most part traded on securities exchanges or in the OTC markets. The market value of these securities, like other market investments,
may move up or down, sometimes rapidly and unpredictably. The net asset value of the Fund may at any point in time be less than
the net asset value of the Fund at the time the shareholder invested in the Fund, even after taking into account any reinvestment
of distributions.
Common
Stock Risk. Common stock of an issuer in the Fund’s portfolio may decline in price for a variety of reasons, including
if the issuer fails to make anticipated dividend payments because, among other reasons, the issuer of the security experiences
a decline in its financial condition. Common stock in which the Fund invests is structurally subordinated as to income and residual
value to preferred stock, bonds and other debt instruments in a company’s capital structure, in terms of priority to corporate
income, and therefore will be subject to greater dividend risk than preferred stock or debt instruments of such issuers. In addition,
while common stock has historically generated higher average returns than fixed income securities, common stock has also experienced
significantly more volatility in generating those returns.
Preferred
Stock Risk. There are special risks associated with the Fund’s investing in preferred securities, including:
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Deferral.
Preferred securities may include provisions that permit the issuer, at its discretion,
to defer dividends or distributions for a stated period without any adverse consequences
to the issuer. If the Fund owns a preferred security that is deferring its dividends
or distributions, the Fund may be required to report income for tax purposes although
it has not yet received such income.
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Non-Cumulative
Dividends. Some preferred securities are non-cumulative, meaning that the dividends
do not accumulate and need not ever be paid. A portion of the portfolio may include investments
in non-cumulative preferred securities, whereby the issuer does not have an obligation
to make up any arrearages to its shareholders. Should an issuer of a non-cumulative preferred
security held by the Fund determine not to pay dividends or distributions on such security,
the Fund’s return from that security may be adversely affected. There is no assurance
that dividends or distributions on non-cumulative preferred securities in which the Fund
invests will be declared or otherwise made payable.
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Subordination.
Preferred securities are subordinated to bonds and other debt instruments in an issuer’s
capital structure in terms of priority to corporate income and liquidation payments,
and therefore will be subject to greater credit risk than more senior debt security instruments.
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Liquidity.
Preferred securities may be substantially less liquid than many other securities, such
as common stocks or U.S. government securities.
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Limited
Voting Rights. Generally, preferred security holders (such as the Fund) have no voting
rights with respect to the issuing company unless preferred dividends have been in arrears
for a specified number of periods, at which time the preferred security holders may be
entitled to elect a number of directors to the issuer’s board. Generally, once
all the arrearages have been paid, the preferred security holders no longer have voting
rights.
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Special
Redemption Rights. In certain varying circumstances, an issuer of preferred securities
may redeem the securities prior to a specified date. For instance, for certain types
of preferred securities, a redemption may be triggered by a change in U.S. federal income
tax or securities laws. A redemption by the issuer may negatively impact the return of
the security held by the Fund.
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Convertible
Securities Risk. Convertible securities generally offer lower interest or dividend yields than non-convertible securities
of similar quality. The market values of convertible securities tend to decline as interest rates increase and, conversely, to
increase as interest rates decline. In the absence of adequate anti-dilution provisions in a convertible security, dilution in
the value of the Fund’s holding may occur in the event the underlying stock is subdivided, additional equity securities
are issued for below market value, a stock dividend is declared or the issuer enters into another type of corporate transaction
that has a similar effect.
Merger
Arbitrage Risk. The Fund may invest in securities of companies for which a tender or exchange offer has been made or announced,
and in securities of companies for which a merger, consolidation, liquidation or reorganization proposal has been announced. The
principal risk of such investments is that certain of such proposed transactions may be renegotiated, terminated or involve a
longer time frame than originally contemplated, in which case the Fund may realize losses. Such risk is sometimes referred to
as “merger arbitrage risk.” Among the factors that affect the level of risk with respect to the completion of the
transaction are the deal spread and number of bidders, the friendliness of the buyer and seller, the strategic rationale behind
the transaction, the existence of regulatory hurdles, the level of due diligence completed on the target company and the ability
of the buyer to finance the transaction. If the spread between the purchase price and the current price of the seller’s
stock is small, the risk that the transaction will not be completed may outweigh the potential
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return.
If there is very little interest by other potential buyers in the target company, the risk of loss may be higher than where there
are back-up buyers that would allow the arbitrageur to realize a similar return if the current deal falls through. Unfriendly
management of the target company or change in friendly management in the middle of a deal increases the risk that the deal will
not be completed even if the target company’s board has approved the transaction and may involve the risk of litigation
expense if the target company pursues litigation in an attempt to prevent the deal from occurring. The underlying strategy behind
the deal is also a risk consideration because the less a target company will benefit from a merger or acquisition, the greater
the risk. There is also a risk that an acquiring company may back out of an announced deal if, in the process of completing its
due diligence of the target company, it discovers something undesirable about such company. In addition, merger transactions are
also subject to regulatory risk because a merger transaction often must be approved by a regulatory body or pass governmental
antitrust review. All of these factors affect the timing and likelihood that the transaction will close. Even if the Investment
Adviser selects announced deals with the goal of mitigating the risks that the transaction will fail to close, such risks may
still delay the closing of such transaction to a date later than the Fund originally anticipated, reducing the level of desired
return to the Fund.
Merger
arbitrage positions are also subject to the risk of overall market movements. To the extent that a general increase or decline
in equity values affects the stocks involved in a merger arbitrage position differently, the position may be exposed to loss.
Finally,
merger arbitrage strategies depend for success on the overall volume of global merger activity, which has historically been cyclical
in nature. During periods when merger activity is low, it may be difficult or impossible to identify opportunities for profit
or to identify a sufficient number of such opportunities to provide balance among potential merger transactions. To the extent
that the number of announced deals and corporate reorganizations decreases or the number of investors in such transactions increases,
it is possible that merger arbitrage spreads will tighten, causing the profitability of investing in such transactions to diminish,
which will in turn decrease the returns to the Fund from such investment activity.
Recapitalization
Risk. In recapitalizations, a corporation may restructure its balance sheet by selling specific assets, significantly
leveraging other assets and creating new classes of equity securities to be distributed, together with a substantial payment in
cash or in debt securities, to existing shareholders. In connection with such transactions, there is a risk that the value of
the cash and new securities distributed will not be as high as the cost of the Fund’s original investment or that no such
distribution will ultimately be made and the value of the Fund’s investment will decline. To the extent an investment in
a company that has undertaken a recapitalization is retained by the Fund, the Fund’s risks will generally be comparable
to those associated with investments in highly leveraged companies, generally including higher than average sensitivity to (i)
short term interest rate fluctuations, (ii) downturns in the general economy or within a particular industry or (iii) adverse
developments within the company itself.
Distribution
Risk for Equity Income Securities. In selecting equity income securities in which the Fund will invest, the Investment
Adviser will consider the issuer’s history of making regular periodic distributions (i.e., dividends) to its equity holders.
An issuer’s history of paying dividends, however, does not guarantee that the issuer will continue to pay dividends in the
future. The dividend income stream associated with equity income securities generally is not guaranteed and will be subordinate
to payment obligations of the issuer on its debt and other liabilities. Accordingly, in the event the issuer does not realize
sufficient income in a particular period both to service its liabilities and to pay dividends on its equity securities, it may
forgo paying dividends on its equity securities. In addition, because in most instances issuers are not obligated to make periodic
distributions to the holders of their equity securities, such distributions or dividends generally may be discontinued at the
issuer’s discretion.
Dividend-producing
equity income securities, in particular those whose market price is closely related to their yield, may exhibit greater sensitivity
to interest rate changes. See “ — Fixed Income Securities Risks — Interest Rate Risk.” The Fund’s
investments in dividend-producing equity income securities may also limit its potential for appreciation during a broad market
advance.
The
prices of dividend-producing equity income securities can be highly volatile. Investors should not assume that the Fund’s
investments in these securities will necessarily reduce the volatility of the Fund’s net asset value or provide “protection,”
compared to other types of equity income securities, when markets perform poorly.
Non-Diversified
Status Risk. The Fund is classified as a “non-diversified” investment company under the 1940 Act, which means
the Fund is not limited by the 1940 Act in the proportion of its assets that may be invested in the securities of a single issuer.
As a non-diversified investment company, the Fund may invest in the securities of individual issuers to a greater degree than
a diversified investment company. As a result, the Fund may be more vulnerable to events affecting a single issuer and therefore,
subject to greater volatility than a fund that is more broadly diversified. Accordingly, an investment in the Fund may present
greater risk to an investor than an investment in a diversified company.
Fixed
Income Securities Risks. Fixed income securities in which the Fund may invest are generally subject to the following risks:
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Interest
Rate Risk. The market value of bonds and other fixed-income or dividend paying securities
changes in response to interest rate changes and other factors. Interest rate risk is
the risk that prices of bonds and other income or dividend paying securities will increase
as interest rates fall and decrease as interest rates rise.
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The
risks associated with rising interest rates are heightened given the historically low interest rate environment as of the date
of this report. The Federal Reserve has begun to raise the Federal Funds rate, and each increase results in more pronounced interest
rate risk in the current market environment. The magnitude of these fluctuations in the market price of bonds and other income
or dividend paying securities is generally greater for those securities with longer maturities. Fluctuations in the market price
of the Fund’s investments will not affect interest income derived from instruments already owned by the Fund, but will be
reflected in the Fund’s net asset value. The Fund may lose money if short term or long term interest rates rise sharply
in a manner not anticipated by Fund management. To the extent the Fund invests in debt securities that may be prepaid at the option
of the obligor (such as mortgage-related securities), the sensitivity of such securities to changes in interest rates may increase
(to the detriment of the Fund) when interest rates rise. Moreover, because rates on certain floating rate debt securities typically
reset only periodically, changes in prevailing interest rates (and particularly sudden and significant changes) can be expected
to cause some fluctuations in the net asset value of the Fund to the extent that it invests in floating rate debt securities.
These basic principles of bond prices also apply to U.S. government securities. A security backed by the “full faith and
credit” of the U.S. government is guaranteed only as to its stated interest rate and face value at maturity, not its current
market price. Just like other income or dividend paying securities, government-guaranteed securities will fluctuate in value when
interest rates change.
The
Fund’s use of leverage will tend to increase the Fund’s interest rate risk. The Fund may utilize certain strategies,
including taking positions in futures or interest rate swaps, for the purpose of reducing the interest rate sensitivity of income
or dividend paying securities held by the Fund and decreasing the Fund’s exposure to interest rate risk. The Fund is not
required to hedge its exposure to interest rate risk and may choose not to do so. In addition, there is no assurance that any
attempts by the Fund to reduce interest rate risk will be successful or that any hedges that the Fund may establish will perfectly
correlate with movements in interest rates.
The
Fund may invest in variable and floating rate debt instruments, which generally are less sensitive to interest rate changes than
longer duration fixed rate instruments, but may decline in value in response to rising interest rates if, for example, the rates
at which they pay interest do not rise as much, or as quickly, as market interest rates in general. Conversely, variable and floating
rate instruments generally will not increase in value if interest rates decline. The Fund also may invest in inverse floating
rate debt securities, which may decrease in value if interest rates increase, and which also may exhibit greater price volatility
than fixed rate debt obligations with similar credit quality. To the extent the Fund holds variable or floating rate instruments,
a decrease (or, in the case of inverse floating rate securities, an increase) in market interest rates will adversely affect the
income received from such securities, which may adversely affect the net asset value of the Fund’s common shares.
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Issuer
Risk. Issuer risk is the risk that the value of an income or dividend paying security may decline for a number of reasons
which directly relate to the issuer, such as management performance, financial leverage, reduced demand for the issuer’s
goods and services, historical and prospective earnings of the issuer and the value of the assets of the issuer.
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Credit Risk. Credit
risk is the risk that one or more income or dividend paying securities in the Fund’s portfolio will decline in price
or fail to pay interest/distributions or principal when due because the issuer of the security experiences a decline in its
financial status. Credit risk is increased when a portfolio security is downgraded or the perceived creditworthiness of the
issuer deteriorates. To the extent the Fund invests in below investment grade securities, it will be exposed to a greater
amount of credit risk than a fund which only invests in investment grade securities. See “Risk Factors and Special Considerations
— General Risks —Non-Investment Grade Securities.” In addition, to the extent the Fund uses credit derivatives,
such use will expose it to additional risk in the event that the bonds underlying the derivatives default. The degree of credit
risk depends on the issuer’s financial condition and on the terms of the securities.
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Prepayment Risk.
Prepayment risk is the risk that during periods of declining interest rates, borrowers may exercise their option to prepay
principal earlier than scheduled. For income or dividend paying securities, such payments often occur during periods of declining
interest rates, forcing the Fund to reinvest in lower yielding securities, resulting in a possible decline in the Fund’s
income and distributions to shareholders. This is known as prepayment or “call” risk. Below investment grade securities
frequently have call features that allow the issuer to redeem the security at dates prior to its stated maturity at a specified
price (typically greater than par) only if certain prescribed conditions are met (“call protection”). For premium
bonds (bonds acquired at prices that exceed their par or principal value) purchased by the Fund, prepayment risk may be enhanced.
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Reinvestment Risk.
Reinvestment risk is the risk that income from the Fund’s portfolio will decline if the Fund invests the proceeds
from matured, traded or called fixed income securities at market interest rates that are below the Fund portfolio’s
current earnings rate.
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Duration and Maturity
Risk. The Fund has no set policy regarding portfolio maturity or duration of the fixed-income securities it may hold.
The Investment Adviser may seek to adjust the duration or maturity of the Fund’s fixed-income holdings based on its
assessment of current and projected market conditions and all other factors that the Investment Adviser deems relevant. In
comparison
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to
maturity (which is the date on which the issuer of a debt instrument is obligated to repay the principal amount), duration is
a measure of the price volatility of a debt instrument as a result in changes in market rates of interest, based on the weighted
average timing of the instrument’s expected principal and interest payments. Specifically, duration measures the anticipated
percentage change in NAV that is expected for every percentage point change in interest rates. The two have an inverse relationship.
Duration can be a useful tool to estimate anticipated price changes to a fixed pool of income securities associated with changes
in interest rates. For example, a duration of five years means that a 1% decrease in interest rates will increase the NAV of the
portfolio by approximately 5%; if interest rates increase by 1%, the NAV will decrease by 5%. However, in a managed portfolio
of fixed income securities having differing interest or dividend rates or payment schedules, maturities, redemption provisions,
call or prepayment provisions and credit qualities, actual price changes in response to changes in interest rates may differ significantly
from a duration-based estimate at any given time. Actual price movements experienced by a portfolio of fixed income securities
will be affected by how interest rates move (i.e., changes in the relationship of long term interest rates to short term interest
rates), the magnitude of any move in interest rates, actual and anticipated prepayments of principal through call or redemption
features, the extension of maturities through restructuring, the sale of securities for portfolio management purposes, the reinvestment
of proceeds from prepayments on and from sales of securities, and credit quality-related considerations whether associated with
financing costs to lower credit quality borrowers or otherwise, as well as other factors. Accordingly, while duration maybe a
useful tool to estimate potential price movements in relation to changes in interest rates, investors are cautioned that duration
alone will not predict actual changes in the net asset or market value of the Fund’s shares and that actual price movements
in the Fund’s portfolio may differ significantly from duration-based estimates. Duration differs from maturity in that it
takes into account a security’s yield, coupon payments and its principal payments in addition to the amount of time until
the security matures. As the value of a security changes over time, so will its duration. Prices of securities with longer durations
tend to be more sensitive to interest rate changes than securities with shorter durations. In general, a portfolio of securities
with a longer duration can be expected to be more sensitive to interest rate changes than a portfolio with a shorter duration.
Any decisions as to the targeted duration or maturity of any particular category of investments will be made based on all pertinent
market factors at any given time. The Fund may incur costs in seeking to adjust the portfolio average duration or maturity. There
can be no assurance that the Investment Adviser’s assessment of current and projected market conditions will be correct
or that any strategy to adjust duration or maturity will be successful at any given time.
Corporate
Bonds Risk. The market value of a corporate bond generally may be expected to rise and fall inversely with interest rates.
The market value of intermediate and longer term corporate bonds is generally more sensitive to changes in interest rates than
is the market value of shorter term corporate bonds. The market value of a corporate bond also may be affected by factors directly
related to the issuer, such as investors’ perceptions of the creditworthiness of the issuer, the issuer’s financial
performance, perceptions of the issuer in the market place, performance of management of the issuer, the issuer’s capital
structure and use of financial leverage and demand for the issuer’s goods and services. Certain risks associated with investments
in corporate bonds are described elsewhere in the prospectus in further detail, including under “Risk Factors and Special
Considerations — General Risks — Fixed Income Securities Risks —Credit Risk,” “ — Fixed Income
Securities Risks — Interest Rate Risk” and “ — Fixed Income Securities Risks — Prepayment Risk.”
There is a risk that the issuers of corporate bonds may not be able to meet their obligations on interest or principal payments
at the time called for by an instrument. Corporate bonds of below investment grade quality are often high risk and have speculative
characteristics and may be particularly susceptible to adverse issuer-specific developments. Corporate bonds of below investment
grade quality are subject to the risks described herein under “ — Non-Investment Grade Securities.”
Coronavirus
(“COVID-19”) and Global Health Event Risk. There is an outbreak of a highly contagious form of a novel coronavirus
known as “COVID-19,” which the World Health Organization has declared a global pandemic. The United States has declared
a national emergency, and for the first time in its history, every state in the United States is under a federal disaster declaration.
Many states, including those in which we and our portfolio companies operate, have issued orders requiring the closure of non-essential
businesses and/or requiring residents to stay at home. The COVID-19 pandemic and preventative measures taken to contain or mitigate
its spread have caused, and are continuing to cause, business shutdowns, cancellations of events and travel, significant reductions
in demand for certain goods and services, reductions in business activity and financial transactions, supply chain interruptions
and overall economic and financial market instability both globally and in the United States. Such effects will likely continue
for the duration of the pandemic, which is uncertain, and for some period thereafter. While several countries, as well as certain
states, counties and cities in the United States, began to relax the early public health restrictions with a view to partially
or fully reopening their economies, many cities, both globally and in the United States, have since experienced a surge in the
reported number of cases and hospitalizations related to the COVID-19 pandemic. This increase in cases has led to the re-introduction
of restrictions and business shutdowns in certain states, counties and cities in the United States and globally and could continue
to lead to the re-introduction of such restrictions elsewhere. Additionally, in December 2020, the U.S. Food and Drug Administration
authorized vaccines produced by Pfizer-BioNTech and Moderna for emergency use. However, it remains unclear how quickly the vaccines
will be distributed nationwide and globally or when “herd immunity” will be achieved and the restrictions that were
imposed to slow the spread of the virus will be lifted entirely. The delay in distributing the vaccines could lead people to continue
to self-isolate and not participate in the economy at pre-pandemic levels for a prolonged period of time. Even after the COVID-19
pandemic subsides, the U.S. economy and most other major global economies may continue to experience a recession, and our business
and operations, as well as the business and operations of our portfolio companies, could be materially adversely affected by a
prolonged
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Additional Fund Information (Continued) (Unaudited)
recession
in the United States and other major markets. Potential consequences of the current unprecedented measures taken in response to
the spread of COVID-19, and current market disruptions and volatility that may impact our business include, but are not limited
to:
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sudden,
unexpected and/or severe declines in the market price of our securities or net asset value;
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inability
of the Fund to accurately or reliably value its portfolio;
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inability
of the Fund to comply with certain asset coverage ratios that would prevent the Fund
from paying dividends to our common stockholders;
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inability
of the Fund to pay any dividends and distributions to any class of equity holders;
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inability
of the Fund to service debt to the extent it has any notes or credit facilities outstanding;
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inability
of the Fund to maintain its status as a RIC under the Code;
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potentially
severe, sudden and unexpected declines in the value of our investments;
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increased
risk of default or bankruptcy by the companies in which we invest;
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increased
risk of companies in which we invest being unable to weather an extended cessation of
normal economic activity and thereby impairing their ability to continue functioning
as a going concern;
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inability
of the companies in which we invest to complete announced transactions;
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reduced
economic demand resulting from mass employee layoffs or furloughs in response to governmental
action taken to slow the spread of COVID-19, which could impact the continued viability
of the companies in which we invest;
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companies
in which we invest being disproportionally impacted by governmental action aimed at slowing
the spread of COVID-19;
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limited
availability of new investment opportunities; and
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general
threats to the Fund’s ability to continue investment operations and to operate successfully as a diversified, closed-end
investment company.
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Despite
actions of the U.S. federal government and foreign governments, the uncertainty surrounding the COVID-19 pandemic and other factors
has contributed to significant volatility and declines in the global public equity markets and global debt capital markets, including
the market price of our common and preferred shares.
It
is virtually impossible to determine the ultimate impact of COVID-19 at this time. Accordingly, an investment in the Fund is subject
to an elevated degree of risk as compared to other market environments.
Non-Investment
Grade Securities. The Fund may invest in below investment-grade securities, also known as “high-yield” securities
or “junk” bonds. Securities rated below investment grade, which may be preferred stock or debt, are predominantly
speculative and involve major risk exposure to adverse conditions. Securities that are rated lower than “BBB” by S&P
or lower than “Baa” by Moody’s (or unrated debt securities of comparable quality) are referred to in the financial
press as “junk bonds” or “high-yield” securities and generally pay a premium above the yields of U.S.
government securities or debt securities of investment grade issuers because they are subject to greater risks than these securities.
These risks, which reflect their speculative character, include the following:
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greater
credit risk and risk of default;
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potentially
greater sensitivity to general economic or industry conditions;
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potential
lack of attractive resale opportunities (illiquidity); and
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additional
expenses to seek recovery from issuers who default.
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In
addition, the prices of these non-investment grade securities are more sensitive to negative developments, such as a decline in
the issuer’s revenues or a general economic downturn, than are the prices of higher grade securities. Non-investment grade
securities tend to be less liquid than investment grade securities. The market value of non-investment grade securities may be
more volatile than the market value of investment grade securities and generally tends to reflect the market’s perception
of the creditworthiness of the issuer and short term market developments to a greater extent than investment grade securities,
which primarily reflect fluctuations in general levels of interest rates.
Ratings
are relative and subjective and not absolute standards of quality. Securities ratings are based largely on the issuer’s
historical
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Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
financial
condition and the rating agencies’ analysis at the time of rating. Consequently, the rating assigned to any particular security
is not necessarily a reflection of the issuer’s current financial condition.
The
Fund may purchase securities of companies that are experiencing significant financial or business difficulties, including companies
involved in bankruptcy or other reorganization and liquidation proceedings. Although such investments may result in significant
financial returns to the Fund, they involve a substantial degree of risk. The level of analytical sophistication, both financial
and legal, necessary for successful investments in issuers experiencing significant business and financial difficulties is unusually
high. There can be no assurance that the Fund will correctly evaluate the value of the assets collateralizing its investments
or the prospects for a successful reorganization or similar action. In any reorganization or liquidation proceeding relating to
a portfolio investment, the Fund may lose all or part of its investment or may be required to accept collateral with a value less
than the amount of the Fund’s initial investment.
As
a part of its investments in non-investment grade securities, the Fund may invest in the securities of issuers in default. The
Fund invests in securities of issuers in default only when the Investment Adviser believes that such issuers will honor their
obligations and emerge from bankruptcy protection and that the value of such issuers’ securities will appreciate. By investing
in the securities of issuers in default, the Fund bears the risk that these issuers will not continue to honor their obligations
or emerge from bankruptcy protection or that the value of these securities will not otherwise appreciate.
In
addition to using statistical rating agencies and other sources, the Investment Adviser will also perform its own analysis of
issuers in seeking investments that it believes to be underrated (and thus higher yielding) in light of the financial condition
of the issuer. Its analysis of issuers may include, among other things, current and anticipated cash flow and borrowing requirements,
value of assets in relation to historical cost, strength of management, responsiveness to business conditions, credit standing
and current anticipated results of operations. In selecting investments for the Fund, the Investment Adviser may also consider
general business conditions, anticipated changes in interest rates and the outlook for specific industries.
Subsequent
to its purchase by the Fund, an issue of securities may cease to be rated or its rating may be reduced. In addition, it is possible
that statistical rating agencies might change their ratings of a particular issue to reflect subsequent events on a timely basis.
Moreover, such ratings do not assess the risk of a decline in market value. None of these events will require the sale of the
securities by the Fund, although the Investment Adviser will consider these events in determining whether the Fund should continue
to hold the securities.
Fixed
income securities, including non-investment grade securities and comparable unrated securities, frequently have call or buy-back
features that permit their issuers to call or repurchase the securities from their holders, such as the Fund. If an issuer exercises
these rights during periods of declining interest rates, the Fund may have to replace the security with a lower yielding security,
thus resulting in a decreased return for the Fund.
The
market for non-investment grade and comparable unrated securities has at various times, particularly during times of economic
recession, experienced substantial reductions in market value and liquidity. Past recessions have adversely affected the ability
of certain issuers of such securities to repay principal and pay interest thereon. The market for those securities could react
in a similar fashion in the event of any future economic recession.
U.S.
Government Securities and Credit Rating Downgrade Risk. The Fund may invest in direct obligations of the government of
the United States or its agencies. Obligations issued or guaranteed by the U.S. government, its agencies, authorities and instrumentalities
and backed by the full faith and credit of the U.S. guarantee only that principal and interest will be timely paid to holders
of the securities. These entities do not guarantee that the value of such obligations will increase, and, in fact, the market
values of such obligations may fluctuate. In addition, not all U.S. government securities are backed by the full faith and credit
of the United States; some are the obligation solely of the entity through which they are issued. There is no guarantee that the
U.S. government would provide financial support to its agencies and instrumentalities if not required to do so by law.
The
events surrounding negotiations regarding the U.S. federal government debt ceiling and deficit reduction could adversely affect
the Fund’s ability to achieve its investment objective. In 2011, S&P lowered its long term sovereign credit rating on
the U.S. to “AA+” from “AAA.” The downgrade by S&P increased volatility in both stock and bond markets,
resulting in higher interest rates and higher Treasury yields, and increased the costs of all kinds of debt. Repeat occurrences
of similar events could have significant adverse effects on the U.S. economy generally and could result in significant adverse
impacts on issuers of securities held by the Fund itself. The Investment Adviser cannot predict the effects of similar events
in the future on the U.S. economy and securities markets or on the Fund’s portfolio. The Investment Adviser monitors developments
and seeks to manage the Fund’s portfolio in a manner consistent with achieving the Fund’s investment objective, but
there can be no assurance that it will be successful in doing so and the Investment Adviser may not timely anticipate or manage
existing, new or additional risks, contingencies or developments.
Value
Investing Risk. The Fund focuses its investments on the securities of companies that the Investment Adviser believes are
undervalued or inexpensive relative to other investments. These types of securities may present risks in addition to the general
risks associated with investing in common and preferred stocks. These securities generally are selected on the basis of an issuer’s
fundamentals relative to
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Additional Fund Information (Continued) (Unaudited)
current
market price. Such securities are subject to the risk of mis-estimation of certain fundamental factors. In addition, during certain
time periods market dynamics may strongly favor “growth” stocks of issuers that do not display strong fundamentals
relative to market price based upon positive price momentum and other factors. Disciplined adherence to a “value”
investment mandate during such periods can result in significant underperformance relative to overall market indices and other
managed investment vehicles that pursue growth style investments and/or flexible equity style mandates.
Selection
Risk. Different types of stocks tend to shift into and out of favor with stock market investors, depending on market and
economic conditions. The performance of funds that invest in value-style stocks may at times be better or worse than the performance
of stock funds that focus on other types of stocks or that have a broader investment style.
Small
and Mid-Cap Stock Risk. The Fund may invest in the equity securities of small-cap and/or mid-cap companies. Small and
mid-cap companies offer investment opportunities and additional risks. They may not be well known to the investing public, may
not be significantly owned by institutional investors and may not have steady earnings growth. These companies may have limited
product or business lines and markets, as well as shorter operating histories, less experienced management and more limited financial
resources than larger companies. Changes in any one line of business, therefore, may have a greater impact on a small or mid-cap
company’s stock price than is the case for a larger company. In addition, the securities of such companies may be more vulnerable
to adverse general market or economic developments, more volatile in price, have wider spreads between their bid and ask prices
and have significantly lower trading volumes than the securities of larger capitalization companies. As such, securities of these
small and mid-cap companies may be less liquid than those of larger companies, and may experience greater price fluctuations than
larger companies. In addition, small-cap or mid-cap company securities may not be widely followed by investors, which may result
in reduced demand.
As
a result, the purchase or sale of more than a limited number of shares of the securities of a small or mid-cap company may affect
its market price. The Investment Adviser may need a considerable amount of time to purchase or sell its positions in these securities,
particularly when other Investment Adviser-managed accounts or other investors are also seeking to purchase or sell them.
The
securities of small and mid-cap companies generally trade in lower volumes and are subject to greater and more unpredictable price
changes than larger capitalization securities or the market as a whole. In addition, small and mid-cap securities may be particularly
sensitive to changes in interest rates, borrowing costs and earnings. Investing in small and mid-cap securities requires a longer-term
view.
Small
and mid-cap companies, due to the size and kinds of markets that they serve, may be less susceptible than large-cap companies
to intervention from the U.S. federal government by means of price controls, regulations or litigation.
Foreign
Securities Risk. Investments in the securities of foreign issuers involve certain considerations and risks not ordinarily
associated with investments in securities of domestic issuers and such securities may be more volatile than those of issuers located
in the United States. Foreign companies are not generally subject to uniform accounting, auditing and financial standards and
requirements comparable to those applicable to U.S. companies. Foreign securities exchanges, brokers and listed companies may
be subject to less government supervision and regulation than exists in the United States. Dividend and interest income may be
subject to withholding and other foreign taxes, which may adversely affect the net return on such investments. There may be difficulty
in obtaining or enforcing a court judgment abroad. In addition, it may be difficult to effect repatriation of capital invested
in certain countries. In addition, with respect to certain countries, there are risks of expropriation, confiscatory taxation,
political or social instability or diplomatic developments that could affect assets of the Fund held in foreign countries. Dividend
income the Fund receives from foreign securities may not be eligible for the special tax treatment applicable to qualified dividend
income. Moreover, certain equity investments in foreign issuers classified as passive foreign investment companies may be subject
to additional taxation risk.
There
may be less publicly available information about a foreign company than a U.S. company. Foreign securities markets may have substantially
less volume than U.S. securities markets and some foreign company securities are less liquid than securities of otherwise comparable
U.S. companies. A portfolio of foreign securities may also be adversely affected by fluctuations in the rates of exchange between
the currencies of different nations and by exchange control regulations. Foreign markets also have different clearance and settlement
procedures that could cause the Fund to encounter difficulties in purchasing and selling securities on such markets and may result
in the Fund missing attractive investment opportunities or experiencing loss. In addition, a portfolio that includes foreign securities
can expect to have a higher expense ratio because of the increased transaction costs on non-U.S. securities markets and the increased
costs of maintaining the custody of foreign securities.
The
Fund also may purchase ADRs or U.S. dollar-denominated securities of foreign issuers. ADRs are receipts issued by U.S. banks or
trust companies in respect of securities of foreign issuers held on deposit for use in the U.S. securities markets. While ADRs
may not necessarily be denominated in the same currency as the securities into which they may be converted, many of the risks
associated with foreign securities may also apply to ADRs. In addition, the underlying issuers of certain depositary receipts,
particularly unsponsored or unregistered depositary receipts, are under no obligation to distribute shareholder communications
to the holders of such receipts, or to pass through to them any voting rights with respect to the deposited securities.
The
following provides more detail on certain pronounced risks with foreign investing:
The
Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
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Foreign
Currency Risk. The Fund may invest in companies whose securities are denominated
or quoted in currencies other than U.S. dollars or have significant operations or markets
outside of the United States. In such instances, the Fund will be exposed to currency
risk, including the risk of fluctuations in the exchange rate between U.S. dollars (in
which the Fund’s shares are denominated) and such foreign currencies, the risk
of currency devaluations and the risks of non-exchangeability and blockage. As non-U.S.
securities may be purchased with and payable in currencies of countries other than the
U.S. dollar, the value of these assets measured in U.S. dollars may be affected favorably
or unfavorably by changes in currency rates and exchange control regulations. Fluctuations
in currency rates may adversely affect the ability of the Investment Adviser to acquire
such securities at advantageous prices and may also adversely affect the performance
of such assets.
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Certain
non-U.S. currencies, primarily in developing countries, have been devalued in the past and might face devaluation in the future.
Currency devaluations generally have a significant and adverse impact on the devaluing country’s economy in the short and
intermediate term and on the financial condition and results of companies’ operations in that country. Currency devaluations
may also be accompanied by significant declines in the values and liquidity of equity and debt securities of affected governmental
and private sector entities generally. To the extent that affected companies have obligations denominated in currencies other
than the devalued currency, those companies may also have difficulty in meeting those obligations under such circumstances, which
in turn could have an adverse effect upon the value of the Fund’s investments in such companies. There can be no assurance
that current or future developments with respect to foreign currency devaluations will not impair the Fund’s investment
flexibility, its ability to achieve its investment objective or the value of certain of its foreign currency-denominated investments.
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Tax
Consequences of Foreign Investing. The Fund’s transactions in foreign currencies,
foreign currency-denominated debt obligations and certain foreign currency options, futures
contracts and forward contracts (and similar instruments) may give rise to ordinary income
or loss to the extent such income or loss results from fluctuations in the value of the
foreign currency concerned. This treatment could increase or decrease the Fund’s
ordinary income distributions to you, and may cause some or all of the Fund’s previously
distributed income to be classified as a return of capital. In certain cases, the Fund
may make an election to treat gain or loss attributable to certain investments as capital
gain or loss.
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EMU
and Redenomination Risk. As the European debt crisis progressed, the possibility
of one or more Eurozone countries exiting the European Monetary Union (“EMU”),
or even the collapse of the Euro as a common currency, arose, creating significant volatility
at times in currency and financial markets. The effects of the collapse of the Euro or
the exit of one or more countries from the EMU, on the U.S. and global economies and
securities markets are impossible to predict, and any such events could have a significant
adverse impact on the value and risk profile of the Fund’s portfolio. Any partial
or complete dissolution of the EMU could have significant adverse effects on currency
and financial markets, and on the values of the Fund’s portfolio investments. If
one or more EMU countries were to stop using the Euro as its primary currency, the Fund’s
investments in such countries may be redenominated into a different or newly adopted
currency. As a result, the value of those investments could decline significantly and
unpredictably. In addition, securities or other investments that are redenominated may
be subject to foreign currency risk, liquidity risk and valuation risk to a greater extent
than similar investments currently denominated in Euros. To the extent a currency used
for redenomination purposes is not specified in respect of certain EMU-related investments,
or should the Euro cease to be used entirely, the currency in which such investments
are denominated may be unclear, making such investments particularly difficult to value
or dispose of. The Fund may incur additional expenses to the extent it is required to
seek judicial or other clarification of the denomination or value of such securities.
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Eurozone
Risk. A number of countries in the EU have experienced, and may continue to experience,
severe economic and financial difficulties. In particular, many EU nations are susceptible
to economic risks associated with high levels of debt, notably due to investments in
sovereign debt of countries such as Greece, Italy, Spain, Portugal, and Ireland. As a
result, financial markets in the EU have been subject to increased volatility and declines
in asset values and liquidity. Responses to these financial problems by European governments,
central banks, and others, including austerity measures and reforms, may not work, may
result in social unrest, and may limit future growth and economic recovery or have other
unintended consequences. Further defaults or restructurings by governments and others
of their debt could have additional adverse effects on economies, financial markets,
and asset valuations around the world. Greece, Ireland, and Portugal have already received
one or more “bailouts” from other Eurozone member states, and it is unclear
how much additional funding they will require or if additional Eurozone member states
will require bailouts in the future. One or more other countries may also abandon the
euro and/or withdraw from the EU, placing its currency and banking system in jeopardy.
The impact of these actions, especially if they occur in a disorderly fashion, is not
clear but could be significant and far-reaching.
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On
March 29, 2017, the United Kingdom (the “UK”) notified the European Council, in accordance with Article 50(2) of the
Treaty on European Union (“Article 50”), of the UK’s intention to withdraw from the European Union (the “EU”).
In issuing the notice, the UK has begun the two year process set out in Article 50 for the UK and the EU to negotiate the terms
of the UK’s withdrawal from the EU, taking into account the framework for the
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Additional Fund Information (Continued) (Unaudited)
UK’s
future relationship with the EU. In accordance with Article 50 the UK will cease to be a member of the EU from March 30, 2019,
absent any agreement between the UK and the EU which results in a change to this date. This historic event is widely expected
to have consequences that are both profound and uncertain for the economic and political future of the United Kingdom and the
EU, and those consequences include significant legal and business uncertainties pertaining to an investment in the Fund. Due to
the very recent occurrence of these events, the full scope and nature of the consequences are not at this time known and are unlikely
to be known for a significant period of time. At the same time, it is reasonable to assume that the significant uncertainty in
the business, legal and political environment engendered by these events has resulted in immediate and longer term risks that
would not have been applicable had the UK not sought to withdraw from the EU (“BREXIT Risks”).
BREXIT
Risks include short and long term market volatility and currency volatility, macroeconomic risk to the UK and European economies,
impetus for further disintegration of the EU and related political stresses (including those related to sentiment against cross
border capital movements and activities of investors like the Fund), prejudice to financial services businesses that are conducting
business in the EU and which are based in the UK, disruption to regulatory regimes related to the operations of the Fund and the
Investment Adviser, legal uncertainty regarding achievement of compliance with applicable financial and commercial laws and regulations
in view of the expected steps to be taken pursuant to or in contemplation of Article 50 and negotiations undertaken under Article
218 of the Treaty on the Functioning of the European Union, and the unavailability of timely information as to expected legal,
tax and other regimes.
In
view of these risks and their application to the Investment Adviser and the Fund’s portfolio, prospective investors should
take into account the significance of the BREXIT Risks, including the wide ranging and serious nature of these risks, and retain
advice as needed, for purposes of evaluating an investment in the Fund. There can be no assurance that the BREXIT Risks will not
alter, and alter significantly, the attractiveness of an investment in the Fund by, among other things, giving rise to impediments
to the intended implementation of the business strategy of the Fund that would have material effects on performance, including
the potential for capital losses, delays, legal and regulatory risk and general uncertainty.
Restricted
and Illiquid Securities. Unregistered securities are securities that cannot be sold publicly in the United States without
registration under the Securities Act. An illiquid investment is a security or other investment that cannot be disposed of within
seven days in the ordinary course of business at approximately the value at which the Fund has valued the investment. Unregistered
securities often can be resold only in privately negotiated transactions with a limited number of purchasers or in a public offering
registered under the Securities Act. Considerable delay could be encountered in either event and, unless otherwise contractually
provided for, the Fund’s proceeds upon sale may be reduced by the costs of registration or underwriting discounts. The difficulties
and delays associated with such transactions could result in the Fund’s inability to realize a favorable price upon disposition
of unregistered securities, and at times might make disposition of such securities impossible. The Fund may be unable to sell
illiquid investments when it desires to do so, resulting in the Fund obtaining a lower price or being required to retain the investment.
Illiquid investments generally must be valued at fair value, which is inherently less precise than utilizing market values for
liquid investments, and may lead to differences between the price at which a security is valued for determining the Fund’s
net asset value and the price the Fund actually receives upon sale.
Short
Sales Risk. Short-selling involves selling securities which may or may not be owned and borrowing the same securities
for delivery to the purchaser, with an obligation to replace the borrowed securities at a later date. If the price of the security
sold short increases between the time of the short sale and the time the Fund replaces the borrowed security, the Fund will incur
a loss; conversely, if the price declines, the Fund will realize a capital gain. Any gain will be decreased, and any loss will
be increased, by the transaction costs incurred by the Fund, including the costs associated with providing collateral to the broker-dealer
(usually cash and liquid securities) and the maintenance of collateral with its Custodian. Although the Fund’s gain is limited
to the price at which it sold the security short, its potential loss is theoretically unlimited.
Short-selling
necessarily involves certain additional risks. However, if the short seller does not own the securities sold short (an uncovered
short sale), the borrowed securities must be replaced by securities purchased at market prices in order to close out the short
position, and any appreciation in the price of the borrowed securities would result in a loss. Uncovered short sales expose the
Fund to the risk of uncapped losses until a position can be closed out due to the lack of an upper limit on the price to which
a security may rise. Purchasing securities to close out the short position can itself cause the price of the securities to rise
further, thereby exacerbating the loss. There is the risk that the securities borrowed by the Fund in connection with a short-sale
must be returned to the securities lender on short notice. If a request for return of borrowed securities occurs at a time when
other short-sellers of the security are receiving similar requests, a “short squeeze” can occur, and the Fund may
be compelled to replace borrowed securities previously sold short with purchases on the open market at the most disadvantageous
time, possibly at prices significantly in excess of the proceeds received at the time the securities were originally sold short.
In
September 2008, in response to spreading turmoil in the financial markets, the SEC temporarily banned short selling in the stocks
of numerous financial services companies, and also promulgated new disclosure requirements with respect to short positions held
by investment managers. The SEC’s temporary ban on short selling of such stocks has since expired, but should similar restrictions
and/or additional
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Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
disclosure
requirements be promulgated, especially if market turmoil occurs, the Fund may be forced to cover short positions more quickly
than otherwise intended and may suffer losses as a result. Such restrictions may also adversely affect the ability of the Fund
to execute its investment strategies generally. Similar emergency orders were also instituted in non-U.S. markets in response
to increased volatility. In 2010, the SEC adopted amendments to Regulations SHO under the Exchange Act that restrict the ability
to engage in a short sale at a price that is less than or equal to the current best bid if the price of the covered security has
decreased by 10% or more from the covered security’s closing price as of the end of the prior day.
Leverage
Risk. The Fund currently uses financial leverage for investment purposes by issuing preferred shares. As of December 31,
2017, the amount of leverage represented approximately 36% of the Fund’s net assets. The Fund’s leveraged capital
structure creates special risks not associated with unleveraged funds that have a similar investment objective and policies. These
include the possibility of greater loss and the likelihood of higher volatility of the net asset value of the Fund and the asset
coverage for any preferred shares or debt outstanding. Such volatility may increase the likelihood of the Fund having to sell
investments in order to meet its obligations to make distributions on the preferred shares or principal or interest payments on
debt securities, or to redeem preferred shares or repay debt when it may be disadvantageous to do so. The Fund’s use of
leverage may require it to sell portfolio investments at inopportune times in order to raise cash to redeem preferred shares or
otherwise de-leverage so as to maintain required asset coverage amounts or comply with the mandatory redemption terms of any outstanding
preferred shares. The use of leverage magnifies both the favorable and unfavorable effects of price movements in the investments
made by the Fund. To the extent the Fund is leveraged in its investment operations, the Fund will be subject to substantial risk
of loss. The Fund cannot assure that borrowings or the issuance of notes or preferred shares will result in a higher yield or
return to the holders of the common shares. Also, to the extent the Fund utilizes leverage, a decline in net asset value could
affect the ability of the Fund to make common share distributions and such a failure to make distributions could result in the
Fund ceasing to qualify as a RIC under the Code.
For
more information regarding the risks of a leverage capital structure to holders of the Fund’s common shares, see “Risk
Factors and Special Considerations — Special Risks to Holder of Common Shares — Leverage Risk.”
Special
Risks Related to Investment in Derivatives. The Fund may participate in derivative transactions. Such transactions entail
certain execution, market, liquidity, counterparty, correlation, volatility, hedging and tax risks. Participation in the options
or futures markets, in currency exchange transactions and in other derivatives transactions involves investment risks and transaction
costs to which the Fund would not be subject absent the use of these strategies. If the Investment Adviser’s prediction
of movements in the direction of the securities, foreign currency, interest rate or other referenced instruments or markets is
inaccurate, the consequences to the Fund may leave the Fund in a worse position than if it had not used such strategies. Risks
inherent in the use of options, swaps, foreign currency, futures contracts and options on futures contracts, securities indices
and foreign currencies include:
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dependence
on the Investment Adviser’s ability to predict correctly movements in the direction of the relevant measure;
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imperfect
correlation between the price of the derivative instrument and movements in the prices of the referenced assets;
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the
fact that skills needed to use these strategies are different from those needed to select portfolio securities;
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the
possible absence of a liquid secondary market for any particular instrument at any time;
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the
possible need to defer closing out certain hedged positions to avoid adverse tax consequences;
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the
possible inability of the Fund to purchase or sell a security or instrument at a time
that otherwise would be favorable for it to do so, or the possible need for the Fund
to sell a security or instrument at a disadvantageous time due to a need for the Fund
to maintain “cover” or to segregate securities in connection with the hedging
techniques; and
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the
creditworthiness of counterparties.
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Options,
futures contracts, swaps contracts, and options thereon and forward contracts on securities and currencies may be traded on foreign
exchanges. Such transactions may not be regulated as effectively as similar transactions in the United States, may not involve
a clearing mechanism and related guarantees, and are subject to the risk of governmental actions affecting trading in, or the
prices of, foreign securities. The value of such positions also could be adversely affected by (i) other complex foreign political,
legal and economic factors, (ii) lesser availability than in the United States of data on which to make trading decisions, (iii)
delays in the ability of the Fund to act upon economic events occurring in the foreign markets during non-business hours in the
United States, (iv) the imposition of different exercise and settlement terms and procedures and margin requirements than in the
United States and (v) less trading volume. Exchanges on which options, futures, swaps and options on futures or swaps are traded
may impose limits on the positions that the Fund may take in certain circumstances.
Many
OTC derivatives are valued on the basis of dealers’ pricing of these instruments. However, the price at which dealers value
a particular derivative and the price which the same dealers would actually be willing to pay for such derivative should the Fund
wish or be forced to sell such position may be materially different. Such differences can result in an overstatement of the Fund’s
net asset value and
The
Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
may
materially adversely affect the Fund in situations in which the Fund is required to sell derivative instruments. Exchange-traded
derivatives and OTC derivative transactions submitted for clearing through a central counterparty have become subject to minimum
initial and variation margin requirements set by the relevant clearinghouse, as well as possible margin requirements mandated
by the SEC or the CFTC. These regulators also have broad discretion to impose margin requirements on non-cleared OTC derivatives.
These margin requirements will increase the overall costs for the Fund.
While
hedging can reduce or eliminate losses, it can also reduce or eliminate gains. Hedges are sometimes subject to imperfect matching
between the derivative and the underlying security, and there can be no assurance that the Fund’s hedging transactions will
be effective.
Derivatives
may give rise to a form of leverage and may expose the Fund to greater risk and increase its costs. Recent legislation calls for
new regulation of the derivatives markets. The extent and impact of the regulation is not yet known and may not be known for some
time. New regulation may make derivatives more costly, may limit the availability of derivatives, or may otherwise adversely affect
the value or performance of derivatives.
Counterparty
Risk. The Fund will be subject to credit risk with respect to the counterparties to the derivative contracts purchased
by the Fund. If a counterparty becomes bankrupt or otherwise fails to perform its obligations under a derivative contract due
to financial difficulties, the Fund may experience significant delays in obtaining any recovery under the derivative contract
in bankruptcy or other reorganization proceeding. The Fund may obtain only a limited recovery or may obtain no recovery in such
circumstances.
The
counterparty risk for cleared derivatives is generally lower than for uncleared OTC derivative transactions since generally a
clearing organization becomes substituted for each counterparty to a cleared derivative contract and, in effect, guarantees the
parties’ performance under the contract as each party to a trade looks only to the clearing organization for performance
of financial obligations under the derivative contract. However, there can be no assurance that a clearing organization, or its
members, will satisfy its obligations to the Fund, or that the Fund would be able to recover the full amount of assets deposited
on its behalf with the clearing organization in the event of the default by the clearing organization or the Fund’s clearing
broker. In addition, cleared derivative transactions benefit from daily marking-to-market and settlement, and segregation and
minimum capital requirements applicable to intermediaries. Uncleared OTC derivative transactions generally do not benefit from
such protections. This exposes the Fund to the risk that a counterparty will not settle a transaction in accordance with its terms
and conditions because of a dispute over the terms of the contract (whether or not bona fide) or because of a credit or liquidity
problem, thus causing the Fund to suffer a loss. Such “counterparty risk” is accentuated for contracts with longer
maturities where events may intervene to prevent settlement, or where the Fund has concentrated its transactions with a single
or small group of counterparties.
Failure
of Futures Commission Merchants and Clearing Organizations Risk. The Fund may deposit funds required to margin open positions
in the derivative instruments subject to the CEA with a clearing broker registered as a “futures commission merchant”
(“FCM”). The CEA requires an FCM to segregate all funds received from customers with respect to any orders for the
purchase or sale of U.S. domestic futures contracts and cleared swaps from the FCM’s proprietary assets. Similarly, the
CEA requires each FCM to hold in a separate secure account all funds received from customers with respect to any orders for the
purchase or sale of foreign futures contracts and segregate any such funds from the funds received with respect to domestic futures
contracts. However, all funds and other property received by a clearing broker from its customers are held by the clearing broker
on a commingled basis in an omnibus account and may be invested by the clearing broker in certain instruments permitted under
the applicable regulation. There is a risk that assets deposited by the Fund with any swaps or futures clearing broker as margin
for futures contracts may, in certain circumstances, be used to satisfy losses of other clients of the Fund’s clearing broker.
In addition, the assets of the Fund may not be fully protected in the event of the clearing broker’s bankruptcy, as the
Fund would be limited to recovering only a pro rata share of all available funds segregated on behalf of the clearing broker’s
combined domestic customer accounts.
Similarly,
the CEA requires a clearing organization approved by the CFTC as a derivatives clearing organization to segregate all funds and
other property received from a clearing member’s clients in connection with domestic futures, swaps and options contracts
from any funds held at the clearing organization to support the clearing member’s proprietary trading. Nevertheless, with
respect to futures contracts and options on futures, a clearing organization may use assets of a non-defaulting customer held
in an omnibus account at the clearing organization to satisfy losses in that account resulting from the default by another customer
on its payment obligations that leads to the clearing member’s default to the clearing organization. As a result, in the
situation of a double default by a customer of the Fund’s clearing member and the clearing member itself with respect to
payment obligations on the customer’s futures or options on futures, there is a risk that the Fund’s assets in an
omnibus account with the clearing organization may be used to satisfy losses from the double default and that the Fund may not
recover the full amount of any such assets.
Swaps
Risk. Swap agreements are two-party contracts entered into primarily by institutional investors for periods ranging from
a few weeks to more than one year. In a standard “swap” transaction, two parties agree to exchange the returns (or
differentials in rates of return) earned or realized on particular predetermined investments or instruments. The gross returns
to be exchanged or “swapped” between the parties are calculated with respect to a “notional amount,” i.e.,
the return on or increase in value of a particular dollar amount invested
The
Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
at
a particular interest rate, in a particular foreign currency, or in a “basket” of securities representing a particular
index. The “notional amount” of the swap agreement is only a fictive basis on which to calculate the obligations that
the parties to a swap agreement have agreed to exchange.
Historically,
swap transactions have been individually negotiated non-standardized transactions entered into in the OTC markets and have not
been subject to the same type of government regulation as exchange-traded instruments. However, the OTC derivatives markets have
recently become subject to comprehensive statutes and regulations. In particular, in the U.S., the Dodd-Frank Wall Street Reform
and Consumer Protection Act of 2010 (the “Dodd-Frank Act”) requires that certain derivatives with U.S. persons must
be executed on a regulated market and a substantial portion of OTC derivatives must be submitted for clearing to regulated clearinghouses.
As a result, swap transactions entered into by the Fund may become subject to various requirements applicable to swaps under the
Dodd-Frank Act, including clearing, exchange-execution, reporting and recordkeeping requirements, which may make it more difficult
and costly for the Fund to enter into swap transactions and may also render certain strategies in which the Fund might otherwise
engage impossible or so costly that they will no longer be economical to implement. Furthermore, the number of counterparties
that may be willing to enter into swap transactions with the Fund may also be limited if the swap transactions with the Fund are
subject to the swap regulation under the Dodd-Frank Act.
Swap
agreements will tend to shift the Fund’s investment exposure from one type of investment to another. For example, if the
Fund agreed to pay fixed rates in exchange for floating rates while holding fixed-rate bonds, the swap would tend to decrease
the Fund’s exposure to long term interest rates. Caps and floors have an effect similar to buying or writing options. Depending
on how they are used, swap agreements may increase or decrease the overall volatility of the Fund’s investments and its
share price and yield. The most significant factor in the performance of swap agreements is the change in the specific interest
rate, currency, or other factors that determine the amounts of payments due to and from the Fund. If a swap agreement calls for
payments by the Fund, the Fund must be prepared to make such payments when due.
The
Fund may enter into swap agreements that would calculate the obligations of the parties to the agreements on a “net”
basis. Consequently, the Fund’s obligations (or rights) under a swap agreement will generally be equal only to the net amount
to be paid or received under the agreement based on the relative values of the positions held by each party to the agreement (the
“net amount”). The Fund’s obligations under a swap agreement will be accrued daily (offset against any amounts
owing to the Fund) and any accrued but unpaid net amounts owed to a swap counterparty will be covered by the maintenance of liquid
assets in accordance with SEC staff positions on the subject.
The
Fund’s use of swap agreements may not be successful in furthering its investment objective, as the Investment Adviser may
not accurately predict whether certain types of investments are likely to produce greater returns than other investments. Moreover,
swap agreements involve the risk that the party with whom a Fund has entered into the swap will default on its obligation to pay
a Fund and the risk that a Fund will not be able to meet its obligations to pay the other party to the agreement. The Fund may
be able to eliminate its exposure under a swap agreement either by assignment or other disposition, or by entering into an offsetting
swap agreement with the same party or a similarly creditworthy party.
Forward
Foreign Currency Exchange Contracts. The Fund may enter into forward foreign currency exchange contracts to protect the
value of its portfolio against uncertainty in the level of future currency exchange rates between a particular foreign currency
and the U.S. dollar or between foreign currencies in which its securities are or may be denominated. The Fund may enter into such
contracts on a spot (i.e., cash) basis at the rate then prevailing in the currency exchange market or on a forward basis, by entering
into a forward contract to purchase or sell currency. A forward contract on foreign currency is an obligation to purchase or sell
a specific currency at a future date, which may be any fixed number of days agreed upon by the parties from the date of the contract
at a price set on the date of the contract. Forward currency contracts (i) are traded in a market conducted directly between currency
traders (typically, commercial banks or other financial institutions) and their customers, (ii) generally have no deposit requirements
and (iii) are typically consummated without payment of any commissions. The Fund, however, may enter into forward currency contracts
requiring deposits or involving the payment of commissions.
The
dealings of the Fund in forward foreign exchange are limited to hedging involving either specific transactions or portfolio positions.
Transaction hedging is the purchase or sale of one forward foreign currency for another currency with respect to specific receivables
or payables of the Fund accruing in connection with the purchase and sale of its portfolio securities or its payment of distributions.
Position hedging is the purchase or sale of one forward foreign currency for another currency with respect to portfolio security
positions denominated or quoted in the foreign currency to offset the effect of an anticipated substantial appreciation or depreciation,
respectively, in the value of the currency relative to the U.S. dollar. In this situation, the Fund also may, for example, enter
into a forward contract to sell or purchase a different foreign currency for a fixed U.S. dollar amount where it is believed that
the U.S. dollar value of the currency to be sold or bought pursuant to the forward contract will fall or rise, as the case may
be, whenever there is a decline or increase, respectively, in the U.S. dollar value of the currency in which its portfolio securities
are denominated (this practice being referred to as a “cross-hedge”).
In
hedging a specific transaction, the Fund may enter into a forward contract with respect to either the currency in which the transaction
is denominated or another currency deemed appropriate by the Investment Adviser. The amount the Fund may invest in forward currency
contracts is limited to the amount of its aggregate investments in foreign currencies.
The
Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
The
use of forward currency contracts may involve certain risks, including the failure of the counterparty to perform its obligations
under the contract, and such use may not serve as a complete hedge because of an imperfect correlation between movements in the
prices of the contracts and the prices of the currencies hedged or used for cover. The Fund will only enter into forward currency
contracts with parties which the Investment Adviser believes to be creditworthy institutions.
Under
current interpretations of the SEC and its staff under the 1940 Act, the Fund must segregate with its custodian liquid assets,
or engage in other SEC or staff approved measures, to “cover” open positions in certain types of derivative instruments.
The purpose of these requirements is to prevent the Fund from incurring excessive leverage through such instruments. In the case
of futures and forward contracts, for example, that are not required as a result of one or more contractual arrangements to settle
for cash only in an amount equal to the change in value of the contract over its term but rather may settle through physical delivery
or in the notional amount, the Fund must segregate liquid assets equal to such contract’s full notional value while it has
an open long position, or equal to the market value of the contract in the case of an open short position. With respect to contracts
that the Fund is contractually obligated to settle for cash in an amount equal to the change in value of the contract, the Fund
needs to segregate liquid assets only in an amount equal to the Fund’s unpaid mark to market obligation rather than the
entire notional amount. This is because the Fund’s maximum potential obligation at that point in time is its net unpaid
mark to market obligation rather than the full notional amount.
Futures
Contracts and Options on Futures. Futures and options on futures entail certain risks, including but not limited to the
following: no assurance that futures contracts or options on futures can be offset at favorable prices; possible reduction of
the yield of the Fund due to the use of hedging; possible reduction in value of both the securities hedged and the hedging instrument;
possible lack of liquidity due to daily limits on price fluctuations; imperfect correlation between the contracts and the securities
being hedged; losses from investing in futures transactions that are potentially unlimited; and the segregation requirements for
such transactions.
Options
Risk. To the extent that the Fund purchases options pursuant to a hedging strategy, the Fund will be subject to the following
additional risks. If a put or call option purchased by the Fund is not sold when it has remaining value, and if the market price
of the underlying security remains equal to or greater than the exercise price (in the case of a put), or remains less than or
equal to the exercise price (in the case of a call), the Fund will lose its entire investment in the option.
Where
a put or call option on a particular security is purchased to hedge against price movements in that or a related security, the
price of the put or call option may move more or less than the price of the security. If restrictions on exercise are imposed,
the Fund may be unable to exercise an option it has purchased. If the Fund is unable to close out an option that it has purchased
on a security, it will have to exercise the option in order to realize any profit or the option may expire worthless.
Dodd-Frank
Act Risk. Title VII of the Dodd-Frank Act (the “Derivatives Title”) imposed a new regulatory structure on
derivatives markets, with particular emphasis on swaps and security based swaps (collectively “swaps”). This regulatory
framework covers a broad range of swap market participants, including banks, non-banks, credit unions, insurance companies, broker-dealers
and investment advisers.
The
SEC, other U.S. regulators, and to a lesser extent the CFTC (the “Regulators”) still are in the process of adopting
regulations to implement the Derivatives Title, though certain aspects of the regulations are substantially complete. Until the
Regulators complete their rulemaking efforts, the full extent to which the Derivatives Title and the rules adopted thereunder
will impact the Fund is unclear. It is possible that the continued development of this new regulatory structure for swaps may
jeopardize certain trades and/or trading strategies that may be employed by the Investment Adviser, or at least make them more
costly.
Current
regulations require the mandatory central clearing and mandatory exchange trading of particular types of interest rate swaps and
index credit default swaps (together, “Covered Swaps”). Together, these regulatory requirements change the Fund’s
trading of Covered Swaps. With respect to mandatory central clearing, the Fund is now required to clear its Covered Swaps through
a clearing broker, which requires, among other things, posting initial margin and variation margin to the Fund’s clearing
broker in order to enter into and maintain positions in Covered Swaps. With respect to mandatory exchange trading, the Investment
Adviser may be required to become a participant on an a type of execution platform called a swap execution facility (“SEF”)
or may be required to access the SEF through an intermediary (such as an executing broker) in order to be able to trade Covered
Swaps for the Fund. In either scenario, the Investment Adviser and/or the Fund may incur additional legal and compliance costs
and transaction fees. Just as with the other regulatory changes imposed as a result of the implementation of the Derivatives Title,
the increased costs and fees associated with trading Covered Swaps may jeopardize certain trades and/or trading strategies that
may be employed by the Investment Adviser, or at least make them more costly.
Additionally,
the Regulators have begun to implement finalized regulations that require swap dealers to collect from the Fund initial margin
and variation margin for uncleared derivatives transactions. The Regulators also plan to finalize proposed regulations that would
impose upon swap dealers new capital requirements. These requirements, when finalized and implemented, may make certain types
of trades and/or trading strategies more costly or impermissible. The Derivatives Title also requires swap dealers and major swap
participants to register with the SEC and/or the CFTC, as appropriate. Swap dealers and major swap participants are subject to
a panoply of new regulations, including among others, capital and margin requirements and business conduct standards. Additionally,
it is expected that swap dealers
The
Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
will
transfer at least some of their compliance costs to counterparties in the form of higher fees or less favorable marks on swap
transactions. This means that the Fund could face increased transaction costs when entering into swaps with a swap dealer.
The
Fund may also be subject to systemic risk reporting requirements in the SEC’s Form PF and/or the CFTC’s Form CPO-PQR.
The Derivatives Title also authorizes the CFTC to impose new position limit requirements, which once adopted, may impair the ability
of the Fund to hedge exposure to or take a directional view of certain physical commodity markets.
These
requirements of the Derivatives Title may also increase the cost of certain hedging and other derivatives transactions. Until
the Regulators complete the rulemaking process for the Derivatives Title, it is unknown the extent to which such risks may materialize.
There
can be no assurance that these developments will not adversely affect the business and investment activities of the Investment
Adviser and the Fund. In addition, the Investment Adviser may be subject to potential registration requirements or other additional
responsibilities under the Derivatives Title and may therefore incur increased cost in conducting the Fund’s strategies,
which may adversely affect the performance of the Fund.
Market
Discount Risk. Whether investors will realize gains or losses upon the sale of additional securities of the Fund will
depend upon the market price of the securities at the time of sale, which may be less or more than the Fund’s net asset
value per share or the liquidation value of any Fund preferred shares issued. Since the market price of any additional securities
the Fund may issue will be affected by such factors as the Fund’s dividend and distribution levels (which are in turn affected
by expenses), dividend and distribution stability, net asset value, market liquidity, the relative demand for and supply of such
securities in the market, general market and economic conditions and other factors beyond the control of the Fund, we cannot predict
whether any such securities will trade at, below or above net asset value or at, below or above their public offering price or
at, below or above their liquidation value, as applicable. For example, common shares of closed-end funds often trade at a discount
to their net asset values and the Fund’s common shares may trade at such a discount. This risk may be greater for investors
expecting to sell their securities of the Fund soon after the completion of a public offering for such securities. The risk of
a market price discount from net asset value is separate and in addition to the risk that net asset value itself may decline.
The Fund’s securities are designed primarily for long term investors, and investors in the shares should not view the Fund
as a vehicle for trading purposes.
Long
Term Objective; Not a Complete Investment Program. The Fund is intended for investors seeking a consistent level of after-tax
total return consisting of income (with a current emphasis on qualifying dividends) and long-term capital gain. The Fund is not
meant to provide a vehicle for those who wish to play short term swings in the stock market. An investment in shares of the Fund
should not be considered a complete investment program. Each shareholder should take into account the Fund’s investment
objective as well as the shareholder’s other investments when considering an investment in the Fund.
Management
Risk. The Fund is subject to management risk because it is an actively managed portfolio. The Investment Adviser will
apply investment techniques and risk analyses in making investment decisions for the Fund, but there can be no guarantee that
these will produce the desired results.
Dependence
on Key Personnel. The Investment Adviser is dependent upon the expertise of Mr. Mario J. Gabelli in providing advisory
services with respect to the Fund’s investments. If the Investment Adviser were to lose the services of Mr. Gabelli, its
ability to service the Fund could be adversely affected. There can be no assurance that a suitable replacement could be found
for Mr. Gabelli in the event of his death, resignation, retirement or inability to act on behalf of the Investment Adviser.
Market
Disruption and Geopolitical Risk. Events of recent years, such as the aftermath of the war in Iraq, instability in Afghanistan,
Pakistan, Egypt, Libya, Syria, Russia, Ukraine and the Middle East, ongoing epidemics of infectious diseases in certain parts
of the world, terrorist attacks in the U.S. and around the world, social and political discord, debt crises (such as the Greek
crisis), sovereign debt downgrades, increasingly strained relations between the United States and a number of foreign countries,
including traditional allies, such as certain European countries, and historical adversaries, such as North Korea, Iran, China
and Russia, and the international community generally, new and continued political unrest in various countries, such as Venezuela,
the exit or potential exit of one or more countries from the European Union (“EU”) or the European Monetary Union
(“EMU”), the change in the U.S. president and the new administration, among others, may result in market volatility,
may have long term effects on the United States and worldwide financial markets, and may cause further economic uncertainties
in the United States and worldwide.
As
a consequence of the United Kingdom’s vote to withdraw from the EU, the government of the United Kingdom gave notice of
its withdrawal from the EU (“BREXIT”). As a result of this decision, the financial markets experienced high levels
of volatility and it is likely that, in the near term, BREXIT will continue to bring about higher levels of uncertainty and volatility.
During this period of uncertainty, the negative impact on not only the United Kingdom and European economies, but the broader
global economy, could be significant, potentially resulting in increased volatility and illiquidity and lower economic growth
for companies that rely significantly on Europe for their business activities and revenues. It is possible that certain economic
activity will be curtailed until some signs of clarity begin to emerge, including negotiations around the terms for United Kingdom’s
exit out of the EU. Any further exits from the EU, or the possibility of such exits, would likely cause additional market disruption
globally and introduce new legal and regulatory uncertainties.
The
Gabelli Global Utility & Income Trust
Additional
Fund Information (Continued) (Unaudited)
The
value and risk profile of the Fund’s portfolio could be adversely impacted by the events above. The Fund does not know how
long the securities markets may be affected by similar events and cannot predict the effects of similar events in the future on
the U.S. economy and securities markets. There can be no assurance that similar events and other market disruptions will not have
other material and adverse implications.
Economic
Events and Market Risk. Periods of market volatility remain, and may continue to occur in the future, in response to various
political, social and economic events both within and outside of the United States. These conditions have resulted in, and in
many cases continue to result in, greater price volatility, less liquidity, widening credit spreads and a lack of price transparency,
with many securities remaining illiquid and of uncertain value. Such market conditions may adversely affect the Fund, including
by making valuation of some of the Fund’s securities uncertain and/or result in sudden and significant valuation increases
or declines in the Fund’s holdings. If there is a significant decline in the value of the Fund’s portfolio, this may
impact the asset coverage levels for the Fund’s outstanding leverage.
Risks
resulting from any future debt or other economic crisis could also have a detrimental impact on the global economic recovery,
the financial condition of financial institutions and our business, financial condition and results of operation. Market and economic
disruptions have affected, and may in the future affect, consumer confidence levels and spending, personal bankruptcy rates, levels
of incurrence and default on consumer debt and home prices, among other factors. To the extent uncertainty regarding the U.S.
or global economy negatively impacts consumer confidence and consumer credit factors, our business, financial condition and results
of operations could be significantly and adversely affected. Downgrades to the credit ratings of major banks could result in increased
borrowing costs for such banks and negatively affect the broader economy. Moreover, Federal Reserve policy, including with respect
to certain interest rates, may also adversely affect the value, volatility and liquidity of dividend- and interest-paying securities.
Market volatility, rising interest rates and/or a return to unfavorable economic conditions could impair the Fund’s ability
to achieve its investment objective.
Government
Intervention in Financial Markets Risk. Past instability in the financial markets has led the U.S. government and certain
foreign governments to take a number of unprecedented actions designed to support certain financial institutions and segments
of the financial markets that have experienced extreme volatility, and in some cases a lack of liquidity, including through direct
purchases of equity and debt securities. The U.S. government and certain foreign governments and their regulatory agencies or
self-regulatory organizations have in the past taken, and may in the future take, legislative and regulatory actions that may
affect the Fund, its securities and/or the Fund’s investments in ways that are unforeseeable. Such legislation or regulation
may change the way in which the Fund is regulated and could limit or preclude the Fund’s ability to achieve its investment
objective.
The
Dodd-Frank Act, signed into law by President Obama on July 21, 2010, contains sweeping financial legislation regarding the operation
of banks, private fund managers and other financial institutions. The Dodd-Frank Act includes provisions regarding, among other
things, the regulation of derivatives (see “ — Dodd-Frank Act Risk” above), the identification, monitoring and
prophylactic regulation of systemic risks to financial markets, and the regulation of proprietary trading and investment activity
of banking institutions. The continuing implementation of the Dodd-Frank Act and any other regulations could adversely affect
the Investment Adviser and the Fund. The Investment
Adviser
may attempt to take certain actions to lessen the impact of the Dodd-Frank Act and any other legislation or regulation affecting
the Fund, although no assurance can be given that such actions would be successful and no assurance can be given that such actions
would not have a significant negative impact on the Fund. The ultimate impact of the Dodd-Frank Act, and any additional future
legislation or regulation, is not yet certain and the Investment Adviser and the Fund may be affected by governmental action in
ways that are unforeseeable.
Additionally,
the SEC and its staff are also reportedly engaged in various initiatives and reviews that seek to improve and modernize the regulatory
structure governing investment companies. These efforts appear to be focused on risk identification and controls in various areas,
including imbedded leverage through the use of derivatives and other trading practices, cybersecurity, liquidity, enhanced regulatory
and public reporting requirements and the evaluation of systemic risks. Any new rules, guidance or regulatory initiatives resulting
from these efforts could increase the Fund’s expenses and impact its returns to shareholders or, in the extreme case, impact
or limit the Fund’s use of various portfolio management strategies or techniques and adversely impact the Fund.
In
the aftermath of the recent financial crisis, there appears to be a renewed popular, political and judicial focus on finance related
consumer protection. Financial institution practices are also subject to greater scrutiny and criticism generally. In the case
of transactions between financial institutions and the general public, there may be a greater tendency toward strict interpretation
of terms and legal rights in favor of the consuming public, particularly where there is a real or perceived disparity in risk
allocation and/or where consumers are perceived as not having had an opportunity to exercise informed consent to the transaction.
In the event of conflicting interests between retail investors holding shares of common stock of a closed-end investment company
such as the Fund and a large financial institution, a court may similarly seek to strictly interpret terms and legal rights in
favor of retail investors.
The
Trump administration has called for substantial changes to U.S. fiscal and tax policies, including comprehensive corporate and
individual tax reform. In addition, the Trump administration has called for, and in certain instances has begun to implement,
significant changes to U.S. trade, healthcare, immigration, foreign, and government regulatory policy. In this regard, there is
significant uncertainty with respect
The
Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
to
legislation, regulation and government policy at the federal level, as well as the state and local levels. Recent events have
created a climate of heightened uncertainty and introduced new and difficult-to-quantify macroeconomic and political risks with
potentially far reaching implications. There has been a corresponding meaningful increase in the uncertainty surrounding interest
rates, inflation, foreign exchange rates, trade volumes and fiscal and monetary policy. To the extent the U.S. Congress or Trump
administration implements changes to U.S. policy, those changes may impact, among other things, the U.S. and global economy, international
trade and relations, unemployment, immigration, corporate taxes, healthcare, the U.S. regulatory environment, inflation and other
areas. Some particular areas identified as subject to potential change, amendment or repeal include the Dodd-Frank Act, including
the Volcker Rule and various swaps and derivatives regulations, credit risk retention requirements and the authorities of the
Federal Reserve, the Financial Stability Oversight Council and the SEC. Although we cannot predict the impact, if any, of these
changes to our business, they could adversely affect our business, financial condition, operating results and cash flows. Until
we know what policy changes are made and how those changes impact our business and the business of our competitors over the long
term, we will not know if, overall, we will benefit from them or be negatively affected by them.
In
addition, the recently enacted Tax Cuts and Jobs Act (the “Act”) makes substantial changes to the Code. Among those
changes are a significant permanent reduction in the generally applicable corporate tax rate, changes in the taxation of individuals
and other non-corporate taxpayers that generally but not universally reduce their taxes on a temporary basis subject to “sunset”
provisions, the elimination or modification of various previously allowed deductions (including substantial limitations on the
deductibility of interest and, in the case of individuals, the deduction for personal state and local taxes), certain additional
limitations on the deduction of net operating losses, certain preferential rates of taxation on certain dividends and certain
business income derived by non-corporate taxpayers in comparison to other ordinary income recognized by such taxpayers, and significant
changes to the international tax rules. The effect of these, and the many other, changes made in the Act is highly uncertain,
both in terms of their direct effect on the taxation of an investment in our common shares and their indirect effect on the value
of our assets, our common shares or market conditions generally. Furthermore, many of the provisions of the Act will require guidance
through the issuance of Treasury regulations in order to assess their effect. There may be a substantial delay before such regulations
are promulgated, increasing the uncertainty as to the ultimate effect of the statutory amendments on us. It is also likely that
there will be technical corrections legislation proposed with respect to the Act, the effect of which cannot be predicted and
may be adverse to us or our shareholders.
Inflation
Risk. Inflation risk is the risk that the value of assets or income from investments will be worth less in the future
as inflation decreases the value of money. As inflation increases, the real value of the Fund’s shares and distributions
therefore may decline. In addition, during any periods of rising inflation, dividend rates of any debt securities issued by the
Fund would likely increase, which would tend to further reduce returns to common shareholders.
Deflation
Risk. Deflation risk is the risk that prices throughout the economy decline over time, which may have an adverse effect
on the market valuation of companies, their assets and their revenues. In addition, deflation may have an adverse effect on the
creditworthiness of issuers and may make issuer default more likely, which may result in a decline in the value of the Fund’s
portfolio.
1940
Act Regulation. The Fund is a registered closed-end investment company and as such is subject to regulations under the
1940 Act. Generally speaking, any contract or provision thereof that is made or where performance involves a violation of the
1940 Act or any rule or regulation thereunder is unenforceable by either party unless a court finds otherwise.
Legislation
Risk. At any time after the date of this report, legislation may be enacted that could negatively affect the assets of
the Fund. Legislation or regulation may change the way in which the Fund itself is regulated. The Investment Adviser cannot predict
the effects of any new governmental regulation that may be implemented and there can be no assurance that any new governmental
regulation will not adversely affect the Fund’s ability to achieve its investment objective.
Reliance
on Service Providers Risk. The Fund must rely upon the performance of service providers to perform certain functions,
which may include functions that are integral to the Fund’s operations and financial performance. Failure by any service
provider to carry out its obligations to the Fund in accordance with the terms of its appointment, to exercise due care and skill
or to perform its obligations to the Fund at all as a result of insolvency, bankruptcy or other causes could have a material adverse
effect on the Fund’s performance and returns to shareholders. The termination of the Fund’s relationship with any
service provider, or any delay in appointing a replacement for such service provider, could materially disrupt the business of
the Fund and could have a material adverse effect on the Fund’s performance and returns to shareholders.
Cyber
Security Risk. The Fund and its service providers are susceptible to cyber security risks that include, among other things,
theft, unauthorized monitoring, release, misuse, loss, destruction or corruption of confidential and highly restricted data; denial
of service attacks; unauthorized access to relevant systems, compromises to networks or devices that the Fund and its service
providers use to service the Fund’s operations; or operational disruption or failures in the physical infrastructure or
operating systems that support the Fund and its service providers. Cyber attacks against or security breakdowns of the Fund or
its service providers may adversely impact the Fund and its stockholders, potentially resulting in, among other things, financial
losses; the inability of Fund stockholders to transact business and the Fund to process transactions; inability to calculate the
Fund’s NAV; violations of applicable privacy and other laws; regulatory fines,
The
Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
penalties,
reputational damage, reimbursement or other compensation costs; and/or additional compliance costs. The Fund may incur additional
costs for cyber security risk management and remediation purposes. In addition, cyber security risks may also impact issuers of
securities in which the Fund invests, which may cause the Fund’s investment in such issuers to lose value. There can be
no assurance that the Fund or its service providers will not suffer losses relating to cyber attacks or other information security
breaches in the future.
Misconduct
of Employees and of Service Providers Risk. Misconduct or misrepresentations by employees of the Investment Adviser or
the Fund’s service providers could cause significant losses to the Fund. Employee misconduct may include binding the Fund
to transactions that exceed authorized limits or present unacceptable risks and authorized trading activities, concealing unsuccessful
trading activities (which in any case, may result in unknown and unmanaged risks or losses) or making misrepresentations regarding
any of the foregoing. Losses could also result from actions by the Fund’s service providers, including, without limitation,
failing to recognize trades and misappropriating assets. In addition, employees and service providers may improperly use or disclose
confidential information, which could result in litigation or serious financial harm, including limiting the Fund’s business
prospects or future marketing activities. Despite the Investment Adviser’s due diligence efforts, misconduct and intentional
misrepresentations may be undetected or not fully comprehended, thereby potentially undermining the Investment Adviser’s
due diligence efforts. As a result, no assurances can be given that the due diligence performed by the Investment Adviser will
identify or prevent any such misconduct.
Loans
of Portfolio Securities. Consistent with applicable regulatory requirements and the Fund’s investment restrictions,
the Fund may lend its portfolio securities to securities broker-dealers or financial institutions, provided that such loans are
callable at any time by the Fund (subject to notice provisions described in the SAI), and are at all times collateralized in accordance
with applicable regulatory requirements. The advantage of such loans is that the Fund continues to receive the income on the loaned
securities while at the same time earning interest on the cash amounts deposited as collateral, which will be invested in short
term obligations. The Fund will not lend its portfolio securities if such loans are not permitted by the laws or regulations of
any state in which its shares are qualified for sale.
Tax
Risk. We cannot assure you what percentage of the distributions paid on the Fund’s shares, if any, will consist
of tax-advantaged qualified dividend income or long term capital gains or what the tax rates on various types of income will be
in future years.
Status
as a Regulated Investment Company. The Fund has elected to qualify as a RIC under Subchapter M of the Code. Qualification
requires, among other things, compliance by the Fund with certain distribution requirements. Statutory limitations on distributions
on the common shares if the Fund fails to satisfy the 1940 Act’s asset coverage requirements could jeopardize the Fund’s
ability to meet such distribution requirements. To qualify and maintain its status as a RIC, the Fund must, among other things,
derive in each taxable year at least 90% of its gross income from certain prescribed sources and distribute for each taxable year
at least 90% of its “investment company taxable income” (generally, ordinary income plus excess, if any, of net short
term capital gain over net long term capital loss). While the Fund presently intends to purchase or redeem notes or preferred
shares, if any, to the extent necessary in order to maintain compliance with such asset coverage requirements, there can be no
assurance that such actions can be effected in time to meet the Code requirements. If the Fund fails to qualify as a RIC for any
reason, it will be subject to U.S. federal income tax at regular corporate rates on all of its taxable income and gains. The resulting
corporate taxes would materially reduce the Fund’s net assets and the amount of cash available for distribution to holders
of the Units. For a more complete discussion of these and other U.S. federal income tax considerations,
Anti-Takeover
Provisions. The Agreement and Declaration of Trust and By-Laws of the Fund include provisions that could limit the ability
of other entities or persons to acquire control of the Fund or convert the Fund to an open-end fund. See “Anti-Takeover
Provisions of the Fund’s Governing Documents.”
Special
Risks to Holders of Notes
An
investment in our notes is subject to special risks. Our notes are not likely to be listed on an exchange or automated quotation
system. We cannot assure you that any market will exist for our notes or if a market does exist, whether it will provide holders
with liquidity. Broker-dealers that maintain a secondary trading market for the notes are not required to maintain this market,
and the Fund is not required to redeem notes if an attempted secondary market sale fails because of a lack of buyers. To the extent
that our notes trade, they may trade at a price either higher or lower than their principal amount depending on interest rates,
the rating (if any) on such notes and other factors.
Special
Risks to Holders of Fixed Rate Preferred Shares
Illiquidity
Prior to Exchange Listing. Prior to an offering, there will be no public market for any series of fixed rate preferred
shares. In the event any additional series of fixed rate preferred shares are issued, we expect to apply to list such shares on
a national securities exchange, which will likely be the NYSE. However, during an initial period, which is not expected to exceed
30 days after the date of initial issuance, such shares may not be listed on any securities exchange. During such period, the
underwriters may make a market in such shares, though they will have no obligation to do so. Consequently, an investment in such
shares may be illiquid during such period.
The
Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
Market
Price Fluctuation. Fixed rate preferred shares may trade at a premium to or discount from liquidation value for various
reasons, including changes in interest rates, perceived credit quality and other factors.
Special
Risks to Holders of Notes and Preferred Shares
Common
Share Repurchases. Repurchases of common shares by the Fund may reduce the net asset coverage of the notes and preferred
shares, which could adversely affect their liquidity or market prices.
Common
Share Distribution Policy. In the event the Fund does not generate a total return from dividends and interest received
and net realized capital gains in an amount at least equal to its distributions for a given year, the Fund expects that it would
return capital as part of its distribution. This would decrease the asset coverage per share with respect to the Fund’s
notes or preferred shares, which could adversely affect their liquidity or market prices.
During
the fiscal year ended December 31, 2017, the Fund made distributions of $1.20 per common share, comprised of net investment income
and long term capital gains. The composition of each distribution is estimated based on earnings as of the record date for the
distribution. The actual composition of each distribution may change based on the Fund’s investment activity through the
end of the calendar year.
Credit
Quality Ratings. The Fund may obtain credit quality ratings for its preferred shares or notes, if desired; however, it
is not required to do so and may issue preferred shares or notes without any rating. If rated, the Fund does not impose any minimum
rating necessary to issue such preferred shares or notes. The Fund’s portfolio must satisfy over-collateralization tests
established by the relevant rating agencies in order to obtain and maintain attractive credit quality ratings for preferred shares
or borrowings, if desired. These tests are more difficult to satisfy to the extent the Fund’s portfolio securities are of
lower credit quality, longer maturity or not diversified by issuer and industry.
These
guidelines could affect portfolio decisions and may be more stringent than those imposed by the 1940 Act. With respect to ratings
(if any) of the notes or preferred shares, a rating by a ratings agency does not eliminate or necessarily mitigate the risks of
investing in our preferred shares or notes, and a rating may not fully or accurately reflect all of the securities’ credit
risks. A rating does not address the liquidity or any other market risks of the securities being rated. A rating agency could
downgrade the rating of our notes or preferred shares, which may make such securities less liquid in the secondary market. If
a rating agency downgrades the rating assigned to our preferred shares or notes, we may alter our portfolio or redeem all or a
portion of the preferred shares or notes that are then redeemable under certain circumstances.
Special
Risks of Notes to Holders of Preferred Shares
As
provided in the 1940 Act, and subject to compliance with the Fund’s investment limitations, the Fund may issue notes. In
the event the Fund were to issue such securities, the Fund’s obligations to pay dividends or make distributions and, upon
liquidation of the Fund, liquidation payments in respect of its preferred shares would be subordinate to the Fund’s obligations
to make any principal and interest payments due and owing with respect to its outstanding notes. Accordingly, the Fund’s
issuance of notes would have the effect of creating special risks for the Fund’s preferred shareholders that would not be
present in a capital structure that did not include such securities.
Special
Risks to Holders of Common Shares
Dilution
Risk. If the Fund determines to conduct a rights offering to subscribe for common shares, holders of common shares may
experience dilution of the aggregate net asset value of their common shares. Such dilution will depend upon whether (i) such shareholders
participate in the rights offering and (ii) the Fund’s net asset value per common share is above or below the subscription
price on the expiration date of the rights offering.
Shareholders
who do not exercise their subscription rights may, at the completion of such an offering, own a smaller proportional interest
in the Fund than if they exercised their subscription rights. As a result of such an offering, a shareholder may experience dilution
in net asset value per share if the subscription price per share is below the net asset value per share on the expiration date.
If the subscription price per share is below the net asset value per share of the Fund’s shares on the expiration date,
a shareholder will experience an immediate dilution of the aggregate net asset value of such shareholder’s shares if the
shareholder does not participate in such an offering and the shareholder will experience a reduction in the net asset value per
share of such shareholder’s shares whether or not the shareholder participates in such an offering. The Fund cannot state
precisely the extent of this dilution (if any) if the shareholder does not exercise such shareholder’s subscription rights
because the Fund does not know what the net asset value per share will be when the offer expires or what proportion of the subscription
rights will be exercised.
Leverage
Risk. The Fund currently uses financial leverage for investment purposes by issuing preferred shares and is also permitted
to
The
Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
use
other types of financial leverage, such as through the issuance of debt securities or additional preferred shares and borrowing
from financial institutions. As provided in the 1940 Act and subject to certain exceptions, the Fund may issue additional senior
securities (which may be stock, such as preferred shares, and/or securities representing debt) only if immediately after such
issuance the value of the Fund’s total assets, less certain ordinary course liabilities, exceeds 300% of the amount of the
debt outstanding and exceeds 200% of the amount of preferred shares and debt outstanding. As of December 31, 2017, the amount
of leverage represented approximately 36% of the Fund’s net assets.
The
Fund’s leveraged capital structure creates special risks not associated with unleveraged funds having a similar investment
objective and policies. These include the possibility of greater loss and the likelihood of higher volatility of the net asset
value of the Fund and the asset coverage for the preferred shares. Such volatility may increase the likelihood of the Fund having
to sell investments in order to meet its obligations to make distributions on the preferred shares or principal or interest payments
on debt securities, or to redeem preferred shares or repay debt, when it may be disadvantageous to do so. The Fund’s use
of leverage may require it to sell portfolio investments at inopportune times in order to raise cash to redeem preferred shares
or otherwise de-leverage so as to maintain required asset coverage amounts or comply with the mandatory redemption terms of any
outstanding preferred shares. The use of leverage magnifies both the favorable and unfavorable effects of price movements in the
investments made by the Fund. To the extent that the Fund employs leverage in its investment operations, the Fund is subject to
substantial risk of loss. The Fund cannot assure you that borrowings or the issuance of preferred shares will result in a higher
yield or return to the holders of the common shares. Also, since the Fund utilizes leverage, a decline in net asset value could
affect the ability of the Fund to make common share distributions and such a failure to make distributions could result in the
Fund ceasing to qualify as a RIC under the Code.
Any
decline in the net asset value of the Fund’s investments would be borne entirely by the holders of common shares. Therefore,
if the market value of the Fund’s portfolio declines, the leverage will result in a greater decrease in net asset value
to the holders of common shares than if the Fund were not leveraged. This greater net asset value decrease will also tend to cause
a greater decline in the market price for the common shares. The Fund might be in danger of failing to maintain the required asset
coverage of its borrowings, notes or preferred shares or of losing its ratings on its notes or preferred shares or notes or, in
an extreme case, the Fund’s current investment income might not be sufficient to meet the distribution or interest requirements
on the borrowings, preferred shares or notes. In order to counteract such an event, the Fund might need to liquidate investments
in order to fund a redemption or repayment of some or all of the borrowings, preferred shares or notes.
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Preferred
Share and Note Risk. The issuance of preferred shares or notes causes the net asset value
and market value of the common shares to become more volatile. If the dividend rate on
the preferred shares or the interest rate on the notes approaches the net rate of return
on the Fund’s investment portfolio, the benefit of leverage to the holders of the
common shares would be reduced. If the dividend rate on the preferred shares or the interest
rate on the notes plus the management fee rate exceeds the net rate of return on the
Fund’s portfolio, the leverage will result in a lower rate of return to the holders
of common shares than if the Fund had not issued preferred shares or notes. If the Fund
has insufficient investment income and gains, all or a portion of the distributions to
preferred shareholders or interest payments to note holders would come from the common
shareholders’ capital. Such distributions and interest payments reduce the net
assets attributable to common shareholders. The Prospectus Supplement relating to any
sale of preferred shares will set forth dividend rate on such preferred shares.
|
In
addition, the Fund would pay (and the holders of common shares will bear) all costs and expenses relating to the issuance and
ongoing maintenance of the preferred shares or notes, including the advisory fees on the incremental assets attributable to the
preferred shares or notes.
Holders
of preferred shares and notes may have different interests than holders of common shares and may at times have disproportionate
influence over the Fund’s affairs. As provided in the 1940 Act and subject to certain exceptions, the Fund may issue senior
securities (which may be stock, such as preferred shares, and/or securities representing debt, such as notes) only if immediately
after the issuance the value of the Fund’s total assets, less certain ordinary course liabilities, exceeds 300% of the amount
of the debt outstanding (i.e., for every dollar of indebtedness outstanding, the Fund is required to have at least three dollars
of assets) and exceeds 200% of the amount of preferred shares and debt outstanding (i.e., for every dollar in liquidation preference
of preferred stock outstanding, the Fund is required to have two dollars of assets), which is referred to as the “asset
coverage” required by the 1940 Act. In the event the Fund fails to maintain an asset coverage of 100% for any notes outstanding
for certain periods of time, the 1940 Act requires that either an event of default be declared or that the holders of such notes
have the right to elect a majority of the Fund’s Trustees until asset coverage recovers to 110%. In addition, holders of
preferred shares, voting separately as a single class, have the right (subject to the rights of noteholders) to elect two members
of the Board at all times and in the event dividends become two full years in arrears would have the right to elect a majority
of the Trustees until such arrearage is completely eliminated. In addition, preferred shareholders have class voting rights on
certain matters, including changes in fundamental investment restrictions and conversion of the Fund to open-end status, and accordingly
can veto any such changes. Further, interest on notes will be payable when due as described in a Prospectus Supplement and if
the Fund does not pay interest when due, it will trigger an event of default and the Fund expects to be restricted
The
Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
AUTOMATIC
DIVIDEND REINVESTMENT
AND VOLUNTARY CASH PURCHASE PLANS
Under
the Fund’s Automatic Dividend Reinvestment Plan and Voluntary Cash Purchase Plan (the “Plan”), a Shareholder
whose shares of common stock are registered in his or her own name will have all distributions reinvested automatically by Computershare
Trust Company, N.A. (“Computershare”), which is an agent under the Plan, unless the shareholder elects to receive
cash. Distributions with respect to shares registered in the name of a broker-dealer or other nominee (that is, in “street
name”) will be reinvested by the broker or nominee in additional shares under the Plan, unless the service is not provided
by the broker or nominee or the Shareholder elects to receive distributions in cash. Investors who own shares of common stock
registered in street name should consult their broker-dealers for details regarding reinvestment. All distributions to investors
who do not participate in the Plan will be paid by check mailed directly to the record holder by Computershare as dividend-disbursing
agent.
Enrollment
in the Plan
It
is the policy of The Gabelli Global Utility & Income Trust (the “Fund”) to automatically reinvest dividends payable
to common shareholders. As a “registered” shareholder you automatically become a participant in the Fund’s Automatic
Dividend Reinvestment Plan (the “Plan”). The Plan authorizes the Fund to credit common shares to participants upon
an income dividend or a capital gains distribution regardless of whether the shares are trading at a discount or a premium to
net asset value. All distributions to shareholders whose shares are registered in their own names will be automatically reinvested
pursuant to the Plan in additional shares of the Fund. Plan participants may send their share certificates to Computershare Trust
Company, N.A. (“Computershare”) to be held in their dividend reinvestment account. Registered shareholders wishing
to receive their distributions in cash may submit this request through the Interrnet, by telephone or in writing to:
The
Gabelli Global Utility & Income Trust
c/o Computershare
P.O. Box 505000
Louisville, KY 40233-5000
Telephone: (800) 336-6983
Website: www.computershare.com/investor
Shareholders
requesting this cash election must include the shareholder’s name and address as they appear on the Fund’s records.
Shareholders with additional questions regarding the Plan or requesting a copy of the terms of the Plan, may contact Computershare
at the website or telephone number above.
If
your shares are held in the name of a broker, bank, or nominee, you should contact such institution. If such institution is not
participating in the Plan, your account will be credited with a cash dividend. In order to participate in the Plan through such
institution, it may be necessary for you to have your shares taken out of “street name” and re-registered in your
own name. Once registered in your own name your distributions will be automatically reinvested. Certain brokers participate in
the Plan. Shareholders holding shares in “street name” at participating institutions will have dividends automatically
reinvested. Shareholders wishing a cash dividend at such institution must contact their broker to make this change.
The
number of common shares distributed to participants in the Plan in lieu of cash dividends is determined in the following manner.
Under the Plan, whenever the market price of the Fund’s common shares is equal to or exceeds net asset value at the time
shares are valued for purposes of determining the number of shares equivalent to the cash dividends or capital gains distribution,
participants are issued common shares valued at the greater of (i) the net asset value as most recently determined or (ii) 95%
of the then current market price of the Fund’s common shares. The valuation date is the dividend or distribution payment
date or, if that date is not a NYSE American trading day, the next trading day. If the net asset value of the common shares at
the time of valuation exceeds the market price of the common shares, participants will receive common shares from the Fund valued
at market price. If the Fund should declare a dividend or capital gains distribution payable only in cash, Computershare will
buy common shares in the open market, or on the NYSE American or elsewhere, for the participants’ accounts, except that
Computershare will endeavor to terminate purchases in the open market and cause the Fund to issue shares at net asset value if,
following the commencement of such purchases, the market value of the common shares exceeds the then current net asset value.
The
automatic reinvestment of dividends and capital gains distributions will not relieve participants of any income tax which may
be payable on such distributions. A participant in the Plan will be treated for federal income tax purposes as having received,
on a dividend payment date, a dividend or distribution in an amount equal to the cash the participant could have received instead
of shares.
The
Gabelli Global Utility & Income Trust
Additional Fund Information (Continued) (Unaudited)
Voluntary
Cash Purchase Plan
The
Voluntary Cash Purchase Plan is yet another vehicle for our shareholders to increase their investment in the Fund. In order to
participate in the Voluntary Cash Purchase Plan, shareholders must have their shares registered in their own name.
Participants
in the Voluntary Cash Purchase Plan have the option of making additional cash payments to Computershare for investments in the
Fund’s shares at the then current market price. Shareholders may send an amount from $250 to $10,000. Computershare will
use these funds to purchase shares in the open market on or about the 1st and 15th of each month. Computershare will charge each
shareholder who participates $0.75, plus a per share fee (currently $0.02 per share). Per share fees include any applicable brokerage
commissions Computershare is required to pay and fees for such purchases are expected to be less than the usual fees for such
transactions. It is suggested that any voluntary cash payments be sent to Computershare, P.O. Box 6006, Carol Stream, IL 60197-6006
such that Computershare receives such payments approximately two business days before the 1st and 15th of the month. Funds not
received at least two business days before the investment date shall be held for investment until the next purchase date. A payment
may be withdrawn without charge if notice is received by Computershare at least two business days before such payment is to be
invested.
Shareholders
wishing to liquidate shares held at Computershare may do so through the Internet, in writing or by telephone to the above-mentioned
website, address or telephone number. Include in your request your name, address, and account number. Computershare will sell
such shares through a broker-dealer selected by Computershare within 5 business days of receipt of the request. The sale price
will equal the weighted average price of all shares sold through the Plan on the day of the sale, less applicable fees Participants
should note that Computershare is unable to accept instructions to sell on a specific date or at a specific price. The cost to
liquidate shares is $2.50 per transaction as well as the per share fee (currently $0.10 per share) Per share fees include any
applicable brokerage commissions Computershare is required to pay and are expected to be less than the usual fees for such transactions.
For
more information regarding the Automatic Dividend Reinvestment Plan and Voluntary Cash Purchase Plan, brochures are available
by calling (914) 921-5070 or by writing directly to the Fund.
The
Fund reserves the right to amend or terminate the Plan as applied to any voluntary cash payments made and any dividend or distribution
paid subsequent to written notice of the change sent to the members of the Plan at least 30 days before the record date for such
dividend or distribution. The Plan also may be amended or terminated by Computershare on at least 30 days written notice to participants
in the Plan.
Unresolved
Staff Comments
The
Fund does not believe that there are any material unresolved written comments, received 180 days or more before September 30,
2020 from the Staff of the SEC regarding any of the Fund’s periodic or current reports under the Securities Exchange Act
or the Investment Company Act, or its registration statement.
The
Gabelli Global Utility & Income Trust
Additional
Fund Information (Continued) (Unaudited)
Financial
Highlights 2011-2015
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Year
Ended December 31,
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2015
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2014
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2013
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2012
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2011
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Operating
Performance:
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Net
asset value, beginning of year
|
|
$21.93
|
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$22.36
|
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$20.44
|
|
|
$20.57
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|
$20.49
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Net investment income
|
|
0.60
|
|
|
0.86
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0.44
|
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|
0.51
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0.57
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Net
realized and unrealized gain on investments, swap contracts, and foreign currency transactions
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(1.39
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)
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0.47
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4.13
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0.56
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0.71
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Total
from investment operations
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(0.79
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)
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1.33
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4.57
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1.07
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1.28
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Distributions
to Preferred Shareholders: (a)
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|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income
|
|
(0.25
|
)
|
|
(0.30
|
)
|
|
(0.29
|
)
|
|
—
|
|
|
—
|
|
Net
realized gain
|
|
(0.12
|
)
|
|
(0.26
|
)
|
|
(0.17
|
)
|
|
—
|
|
|
—
|
|
Total
distributions to preferred shareholders
|
|
(0.37
|
)
|
|
(0.56
|
)
|
|
(0.46
|
)
|
|
—
|
|
|
—
|
|
Net
Increase/(Decrease) in Net Assets Attributable to Common Shareholders Resulting from Operations
|
|
(1.16
|
)
|
|
0.77
|
|
|
4.11
|
|
|
1.07
|
|
|
1.28
|
|
Distributions
to Common Shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income
|
|
(0.22
|
)
|
|
(0.39
|
)
|
|
(0.25
|
)
|
|
(0.55
|
)
|
|
(0.60
|
)
|
Net realized gain
|
|
(0.11
|
)
|
|
(0.33
|
)
|
|
(0.15
|
)
|
|
(0.32
|
)
|
|
(0.39
|
)
|
Return of capital
|
|
(0.87
|
)
|
|
(0.48
|
)
|
|
(0.80
|
)
|
|
(0.33
|
)
|
|
(0.21
|
)
|
Total
distributions to common shareholders
|
|
(1.20
|
)
|
|
(1.20
|
)
|
|
(1.20
|
)
|
|
(1.20
|
)
|
|
(1.20
|
)
|
Fund Share Transactions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Increase/(Decrease) in
net asset value from common share transactions
|
|
—
|
|
|
—
|
|
|
0.01
|
|
|
(0.00
|
)(b)
|
|
0.00
|
(b)
|
Decrease in net asset
value from common shares issued in rights offering.
|
|
—
|
|
|
—
|
|
|
(0.88
|
)
|
|
—
|
|
|
—
|
|
Increase/(Decrease)
in net asset value from repurchase of common shares
|
|
0.00
|
(b)
|
|
(0.00
|
)(b)
|
|
—
|
|
|
—
|
|
|
—
|
|
Net
decrease from costs charged to repurchase of common shares
|
|
(0.00
|
)(b)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Offering
expenses charged to paid-in capital
|
|
—
|
|
|
(0.00
|
)(b)
|
|
(0.12
|
)
|
|
—
|
|
|
—
|
|
Total Fund share transactions
|
|
0.00
|
(b)
|
|
(0.00
|
)(b)
|
|
(0.99
|
)
|
|
(0.00
|
)(b)
|
|
0.00
|
(b)
|
Net
Asset Value Attributable to Common Shareholders, End of Year
|
|
$19.57
|
|
|
$21.93
|
|
|
$22.36
|
|
|
$20.44
|
|
|
$20.57
|
|
NAV
total return †
|
|
(5.52
|
)%
|
|
3.53
|
%
|
|
21.54
|
%
|
|
5.42
|
%
|
|
6.39
|
%
|
Market value, end
of Year
|
|
$16.70
|
|
|
$19.43
|
|
|
$20.04
|
|
|
$20.88
|
|
|
$21.08
|
|
Investment
total return *
|
|
(8.16
|
)%
|
|
2.98
|
%
|
|
7.32
|
%
|
|
5.09
|
%
|
|
10.12
|
%
|
The
Gabelli Global Utility & Income Trust
Additional
Fund Information (Continued) (Unaudited)
|
|
Year Ended December 31,
|
|
|
|
2015
|
|
|
2014
|
|
|
2013
|
|
|
2012
|
|
|
2011
|
|
Ratios to Average Net Assets and Supplemental Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net assets including liquidation value of preferred shares, end of year (in 000’s)
|
|
$
|
131,749
|
|
|
$
|
141,789
|
|
|
$
|
143,724
|
|
|
|
—
|
|
|
|
—
|
|
Net assets attributable to common shares, end of year (in 000’s)
|
|
$
|
80,445
|
|
|
$
|
90,167
|
|
|
$
|
92,103
|
|
|
$
|
63,256
|
|
|
$
|
63,334
|
|
Ratio of net investment income to average net assets attributable to common shares before preferred share distributions
|
|
|
2.81
|
%
|
|
|
3.85
|
%
|
|
|
2.40
|
%
|
|
|
2.50
|
%
|
|
|
2.75
|
%
|
Ratio of operating expenses to average net assets attributable to common shares
|
|
|
1.41
|
%(c)
|
|
|
1.39
|
%
|
|
|
1.22
|
%
|
|
|
1.24
|
%
|
|
|
1.36
|
%
|
Ratio of operating expenses to average net assets including liquidation value of preferred shares.
|
|
|
0.89
|
%(c)
|
|
|
0.89
|
%
|
|
|
0.74
|
%
|
|
|
—
|
|
|
|
—
|
|
Portfolio turnover rate.
|
|
|
14.2
|
%
|
|
|
26.6
|
%
|
|
|
28.2
|
%
|
|
|
6.0
|
%
|
|
|
5.9
|
%
|
Preferred Shares:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series A Cumulative Preferred Shares
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liquidation value, end of year (in 000’s).
|
|
$
|
51,304
|
|
|
$
|
51,621
|
|
|
$
|
51,621
|
|
|
|
—
|
|
|
|
—
|
|
Total shares outstanding (in 000’s)
|
|
|
1,026
|
|
|
|
1,032
|
|
|
|
1,032
|
|
|
|
—
|
|
|
|
—
|
|
Liquidation preference per share
|
|
$
|
50.00
|
|
|
$
|
50.00
|
|
|
$
|
50.00
|
|
|
|
—
|
|
|
|
—
|
|
Average market value(d)
|
|
$
|
50.49
|
|
|
$
|
50.55
|
|
|
$
|
50.88
|
|
|
|
—
|
|
|
|
—
|
|
Asset coverage per share
|
|
$
|
128.40
|
|
|
$
|
137.34
|
|
|
$
|
139.21
|
|
|
|
—
|
|
|
|
—
|
|
Asset Coverage.
|
|
|
257
|
%
|
|
|
275
|
%
|
|
|
278
|
%
|
|
|
—
|
|
|
|
—
|
|
†
|
Based
on net asset value per share, adjusted for reinvestment of distributions at the net asset value per share on the ex-dividend
dates and adjustments for the rights offering.
|
*
|
Based
on market value per share at initial public offering of $20.00 per share, adjusted for reinvestments of distributions at prices
obtained under the Fund’s dividend reinvestment plan and adjustments for the rights offering.
|
(a)
|
Calculated
based on average common shares outstanding on the record dates throughout the years.
|
(b)
|
Amount
represents less than $0.005 per share.
|
(c)
|
The
Fund received credits from a designated broker who agreed to pay certain Fund operating expenses. For the year ended December
31, 2015, there was no impact on the expense ratios.
|
(d)
|
Based
on weekly prices.
|
The
Gabelli Global Utility & Income Trust
Additional
Fund Information (Continued) (Unaudited)
The
business and affairs of the Fund are managed under the direction of the Fund’s Board of Trustees. Information pertaining
to the Trustees and officers of the Fund is set forth below. The Fund’s Statement of Additional Information includes additional
information about the Fund’s Trustees and is available without charge, upon request, by calling 800-GABELLI (800-422-3554)
or by writing to The Gabelli Global Utility & Income Trust at One Corporate Center, Rye, NY 10580-1422.