UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-22026
The Gabelli SRI Fund, Inc.
(Exact name of registrant as specified in charter)
One Corporate Center
Rye, New York 10580-1422
(Address of principal executive offices) (Zip code)
Bruce N. Alpert
Gabelli Funds, LLC
One Corporate Center
Rye, New York 10580-1422
(Name and address of agent for service)
registrant's telephone number, including area code: 1-800-422-3554
Date of fiscal year end: March 31
Date of reporting period: September 30, 2008
Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 100 F Street, NE,
Washington, DC 20549. The OMB has reviewed this collection of information under
the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
The Report to Shareholders is attached herewith.
THE GABELLI SRI FUND, INC.
SEMI-ANNUAL REPORT
SEPTEMBER 30, 2008
TO OUR SHAREHOLDERS,
The net asset value ("NAV") per share of The Gabelli SRI Fund, Inc. (the
"Fund") was down 3.79% for the quarter ended September 30, 2008 while the
Standard & Poor's ("S&P") 500 Index decreased 8.36% over the same period. Since
inception the Fund is down 16.13% outperforming the decline of the S&P 500 Index
of 16.76%.
Enclosed are the investment portfolio and financial statements as of
September 30, 2008.
COMPARATIVE RESULTS
AVERAGE ANNUAL RETURNS THROUGH SEPTEMBER 30, 2008 (a) (UNAUDITED)
Since
Year to Inception
Quarter Date 1 Year (6/1/07)
------- ------- ------- ---------
GABELLI SRI FUND CLASS AAA .. (3.79)% (13.50)% (19.22)% (16.13)%
S&P 500 Index ............... (8.36) (19.27) (21.96) (16.76)
Class A ..................... (3.67) (13.31) (19.09) (16.09)
(9.21)(b) (18.30)(b) (23.74)(b) (19.74)(b)
Class C ..................... (3.94) (13.89) (19.81) (16.71)
(4.90)(c) (14.75)(c) (20.61)(c) (16.71)
Class I ..................... (3.78) (13.28) (19.02) (15.91)
IN THE CURRENT PROSPECTUS, THE GROSS EXPENSE RATIOS FOR CLASS AAA, A, C, AND I
SHARES ARE 22.50%, 22.50%, 23.25%, AND 22.25%, RESPECTIVELY.THE NET EXPENSE
RATIOS AFTER CONTRACTUAL REIMBURSEMENTS BY THE ADVISER IN PLACE THROUGH MARCH
31, 2009 ARE 2.00%, 2.00%, 2.75%, AND 1.75%, RESPECTIVELY. CLASS AAA AND I
SHARES DO NOT HAVE A SALES CHARGE. THE MAXIMUM SALES CHARGE FOR CLASS A AND C
SHARES IS 5.75% AND 1.00%, RESPECTIVELY.
(a) RETURNS REPRESENT PAST PERFORMANCE AND DO NOT GUARANTEE FUTURE RESULTS.
TOTAL RETURNS AND AVERAGE ANNUAL RETURNS REFLECT CHANGES IN SHARE PRICE AND
REINVESTMENT OF DISTRIBUTIONS AND ARE NET OF EXPENSES. INVESTMENT RETURNS
AND THE PRINCIPAL VALUE OF AN INVESTMENT WILL FLUCTUATE. WHEN SHARES ARE
REDEEMED, THEY MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
PERFORMANCE RETURNS FOR PERIODS OF LESS THAN ONE YEAR ARE NOT ANNUALIZED.
CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE PERFORMANCE DATA
PRESENTED. VISIT WWW.GABELLI.COM FOR PERFORMANCE INFORMATION AS OF THE MOST
RECENT MONTH END. INVESTORS SHOULD CAREFULLY CONSIDER THE INVESTMENT
OBJECTIVES, RISKS, CHARGES, AND EXPENSES OF THE FUND BEFORE INVESTING. THE
PROSPECTUS CONTAINS MORE INFORMATION ABOUT THIS AND OTHER MATTERS AND
SHOULD BE READ CAREFULLY BEFORE INVESTING. THE S&P 500 INDEX IS AN
UNMANAGED INDICATOR OF STOCK MARKET PERFORMANCE. DIVIDENDS ARE CONSIDERED
REINVESTED. YOU CANNOT INVEST DIRECTLY IN AN INDEX.
(b) INCLUDES THE EFFECT OF THE MAXIMUM 5.75% SALES CHARGE AT THE BEGINNING OF
THE PERIOD.
(c) PERFORMANCE RESULTS INCLUDE THE DEFERRED SALES CHARGES FOR THE CLASS C
SHARES UPON REDEMPTION AT THE END OF THE QUARTER, YEAR TO DATE, AND ONE
YEAR PERIODS OF 1% OF THE FUND'S NAV PER SHARE AT THE TIME OF PURCHASE OR
SALE, WHICHEVER IS LOWER.
We have separated the portfolio manager's commentary from the financial
statements and investment portfolio due to corporate governance regulations
stipulated by the Sarbanes-Oxley Act of 2002. We have done this to ensure that
the content of the portfolio manager's commentary is unrestricted. The financial
statements and investment portfolio are mailed separately from the commentary.
Both the commentary and the financial statements, including the portfolio of
investments, will be available on our website at www.gabelli.com/funds.
THE GABELLI SRI FUND, INC.
DISCLOSURE OF FUND EXPENSES (UNAUDITED)
For the Period from April 1, 2008 through September 30, 2008 EXPENSE TABLE
We believe it is important for you to understand the impact of fees and expenses
regarding your investment. All mutual funds have operating expenses. As a
shareholder of a fund, you incur ongoing costs, which include costs for
portfolio management, administrative services, and shareholder reports (like
this one), among others. Operating expenses, which are deducted from a fund's
gross income, directly reduce the investment return of a fund. When a fund's
expenses are expressed as a percentage of its average net assets, this figure is
known as the expense ratio. The following examples are intended to help you
understand the ongoing costs (in dollars) of investing in your Fund and to
compare these costs with those of other mutual funds. The examples are based on
an investment of $1,000 made at the beginning of the period shown and held for
the entire period.
The Expense Table below illustrates your Fund's costs in two ways:
ACTUAL FUND RETURN: This section provides information about actual account
values and actual expenses. You may use this section to help you to estimate the
actual expenses that you paid over the period after any fee waivers and expense
reimbursements. The "Ending Account Value" shown is derived from the Fund's
ACTUAL return during the past six months, and the "Expenses Paid During Period"
shows the dollar amount that would have been paid by an investor who started
with $1,000 in the Fund. You may use this information, together with the amount
you invested, to estimate the expenses that you paid over the period.
To do so, simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.6), then multiply the result by the number
given for your Fund under the heading "Expenses Paid During Period" to estimate
the expenses you paid during this period.
HYPOTHETICAL 5% RETURN: This section provides information about hypothetical
account values and hypothetical expenses based on the Fund's actual expense
ratio. It assumes a hypothetical annualized return of 5% before expenses during
the period shown. In this case - because the hypothetical return used is NOT the
Fund's actual return - the results do not apply to your investment and you
cannot use the hypothetical account value and expense to estimate the actual
ending account balance or expenses you paid for the period. This example is
useful in making comparisons of the ongoing costs of investing in the Fund and
other funds. To do so, compare this 5% hypothetical example with the 5%
hypothetical examples that appear in shareholder reports of other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs such as sales
charges (loads), redemption fees, or exchange fees, if any, which are described
in the Prospectus. If these costs were applied to your account, your costs would
be higher. Therefore, the 5% hypothetical return is useful in comparing ongoing
costs only, and will not help you determine the relative total costs of owning
different funds.
Beginning Ending Annualized Expenses
Account Value Account Value Expense Paid During
04/01/08 09/30/08 Ratio Period*
------------- ------------- ---------- -----------
THE GABELLI SRI FUND, INC.
ACTUAL FUND RETURN
Class AAA $1,000.00 $ 937.00 2.01% $ 9.76
Class A $1,000.00 $ 938.10 2.01% $ 9.77
Class C $1,000.00 $ 933.10 2.76% $13.37
Class I $1,000.00 $ 938.20 1.76% $ 8.55
HYPOTHETICAL 5% RETURN
Class AAA $1,000.00 $1,014.99 2.01% $10.15
Class A $1,000.00 $1,014.99 2.01% $10.15
Class C $1,000.00 $1,011.23 2.76% $13.92
Class I $1,000.00 $1,016.24 1.76% $ 8.90
* Expenses are equal to the Fund's annualized expense ratio for the last six
months multiplied by the average account value over the period, multiplied
by the number of days in the most recent fiscal half-year, then divided by
365.
2
SUMMARY OF PORTFOLIO HOLDINGS (UNAUDITED)
The following table presents portfolio holdings as a percent of net assets as of
September 30, 2008:
THE GABELLI SRI FUND, INC.
U.S. Government Obligations .................................. 20.9%
Food and Beverage ............................................ 15.4%
Cable and Satellite .......................................... 6.3%
Telecommunications ........................................... 5.6%
Financial Services ........................................... 5.6%
Energy and Utilities ......................................... 5.3%
Health Care .................................................. 4.3%
Specialty Chemicals .......................................... 4.3%
Entertainment ................................................ 4.2%
Automotive: Parts and Accessories ............................ 3.0%
Wireless Communications ...................................... 2.9%
Retail ....................................................... 2.5%
Equipment and Supplies ....................................... 2.3%
Transportation ............................................... 2.0%
Automotive ................................................... 2.0%
Environmental Services ....................................... 1.9%
Computer Software and Services ............................... 1.7%
Broadcasting ................................................. 1.7%
Agriculture .................................................. 1.7%
Business Services ............................................ 1.5%
Hotels ....................................................... 1.5%
Machinery .................................................... 1.1%
Diversified Industrial ....................................... 1.1%
Publishing ................................................... 0.7%
Other Assets and Liabilities (Net) ........................... 0.5%
-----
100.0%
=====
THE FUND FILES A COMPLETE SCHEDULE OF PORTFOLIO HOLDINGS WITH THE SECURITIES AND
EXCHANGE COMMISSION (THE "SEC") FOR THE FIRST AND THIRD QUARTERS OF EACH FISCAL
YEAR ON FORM N-Q, THE LAST OF WHICH WAS FILED FOR THE QUARTER ENDED JUNE 30,
2008. SHAREHOLDERS MAY OBTAIN THIS INFORMATION AT www.gabelli.com OR BY CALLING
THE FUND AT 800-GABELLI (800-422-3554).THE FUND'S FORM N-Q IS AVAILABLE ON THE
SEC'S WEBSITE AT www.sec.gov AND MAY ALSO BE REVIEWED AND COPIED AT THE SEC'S
PUBLIC REFERENCE ROOM IN WASHINGTON, DC. INFORMATION ON THE OPERATION OF THE
PUBLIC REFERENCE ROOM MAY BE OBTAINED BY CALLING 1-800-SEC-0330.
PROXY VOTING
The Fund files Form N-PX with its complete proxy voting record for the 12 months
ended June 30th, no later than August 31st of each year. A description of the
Fund's proxy voting policies, procedures, and how the Fund voted proxies
relating to portfolio securities is available without charge, upon request, by
(i) calling 800-GABELLI (800-422-3554); (ii) writing to The Gabelli Funds at One
Corporate Center, Rye, NY 10580-1422; or (iii) visiting the SEC's website at
www.sec.gov.
3
THE GABELLI SRI FUND, INC.
SCHEDULE OF INVESTMENTS -- SEPTEMBER 30, 2008 (UNAUDITED)
MARKET
SHARES COST VALUE
- ----------- ---------- ----------
COMMON STOCKS -- 78.6%
AGRICULTURE -- 1.7%
1,500 Archer-Daniels-Midland Co. ................... $ 49,174 $ 32,865
---------- ----------
AUTOMOTIVE -- 2.0%
4,000 General Motors Corp. ......................... 80,667 37,800
---------- ----------
AUTOMOTIVE: PARTS AND ACCESSORIES -- 3.0%
1,000 Midas Inc.+ .................................. 20,782 13,760
1,200 Modine Manufacturing Co. ..................... 27,051 17,376
1,000 O'Reilly Automotive Inc.+ .................... 25,737 26,770
---------- ----------
73,570 57,906
---------- ----------
BROADCASTING -- 1.7%
1,000 Beasley Broadcast Group Inc., Cl. A .......... 8,088 1,690
1,200 CBS Corp., Cl. A ............................. 35,736 17,556
400 Gray Television Inc. ......................... 3,824 688
400 Liberty Media Corp. - Capital, Cl. A+ ........ 7,974 5,352
1,500 LIN TV Corp., Cl. A+ ......................... 21,386 7,740
---------- ----------
77,008 33,026
---------- ----------
BUSINESS SERVICES -- 1.5%
1,500 Intermec Inc.+ ............................... 33,992 29,460
---------- ----------
CABLE AND SATELLITE -- 6.3%
2,000 Cablevision Systems Corp., Cl. A ............. 59,725 50,320
500 DISH Network Corp., Cl. A+ ................... 14,891 10,500
400 Scripps Networks Interactive Inc., Cl. A ..... 16,172 14,524
1,800 The DIRECTV Group Inc.+ ...................... 42,590 47,106
---------- ----------
133,378 122,450
---------- ----------
COMPUTER SOFTWARE AND SERVICES -- 1.7%
1,000 Diebold Inc. ................................. 37,035 33,110
---------- ----------
DIVERSIFIED INDUSTRIAL -- 1.1%
700 Crane Co. .................................... 30,159 20,797
---------- ----------
ENERGY AND UTILITIES -- 5.3%
1,027 Great Plains Energy Inc. ..................... 26,620 22,820
800 National Fuel Gas Co. ........................ 36,439 33,744
1,000 Rowan Companies Inc. ......................... 36,936 30,550
700 Westar Energy Inc. ........................... 16,964 16,128
---------- ----------
116,959 103,242
---------- ----------
ENTERTAINMENT -- 4.2%
1,000 Grupo Televisa SA, ADR ....................... 24,023 21,870
1,600 Liberty Media Corp. - Entertainment, Cl. A+ .. 41,865 39,952
1,500 Time Warner Inc. ............................. 25,704 19,665
---------- ----------
91,592 81,487
---------- ----------
MARKET
SHARES COST VALUE
- ----------- ---------- ----------
ENVIRONMENTAL SERVICES -- 1.9%
1,200 Waste Management Inc. ........................ $ 43,041 $ 37,788
---------- ----------
EQUIPMENT AND SUPPLIES -- 2.3%
300 CIRCOR International Inc. .................... 12,670 13,029
200 Flowserve Corp. .............................. 16,683 17,754
1,500 Gerber Scientific Inc.+ ...................... 16,409 13,710
---------- ----------
45,762 44,493
---------- ----------
FINANCIAL SERVICES -- 5.6%
1,200 American Express Co. ......................... 70,064 42,516
700 Citigroup Inc. ............................... 21,757 14,357
800 Sterling Bancorp ............................. 12,237 11,568
1,200 SWS Group Inc. ............................... 18,450 24,192
1,000 The Blackstone Group LP ...................... 24,583 15,340
---------- ----------
147,091 107,973
---------- ----------
FOOD AND BEVERAGE -- 15.4%
640 Cadbury plc, ADR ............................. 35,510 26,202
700 Campbell Soup Co. ............................ 25,169 27,020
1,180 Dr. Pepper Snapple Group Inc.+ ............... 28,938 31,246
800 General Mills Inc. ........................... 46,523 54,976
500 Groupe Danone, ADR ........................... 7,952 7,023
1,500 PepsiAmericas Inc. ........................... 35,705 31,080
800 The Coca-Cola Co. ............................ 45,907 42,304
1,000 The Hershey Co. .............................. 42,273 39,540
500 Wm. Wrigley Jr. Co. .......................... 38,068 39,700
---------- ----------
306,045 299,091
---------- ----------
HEALTH CARE -- 4.3%
1,400 Advanced Medical Optics Inc.+ ................ 43,000 24,892
1,000 Alpharma Inc., Cl. A+ ........................ 22,573 36,890
200 AngioDynamics Inc.+ .......................... 3,230 3,160
300 Zimmer Holdings Inc.+ ........................ 19,426 19,368
---------- ----------
88,229 84,310
---------- ----------
HOTELS -- 1.5%
1,000 Gaylord Entertainment Co.+ ................... 40,022 29,370
---------- ----------
MACHINERY -- 1.1%
500 Donaldson Co. Inc. ........................... 20,545 20,955
---------- ----------
PUBLISHING -- 0.7%
2,000 Lee Enterprises Inc. ......................... 17,989 7,000
1,033 The E.W. Scripps Co., Cl. A .................. 9,305 7,303
---------- ----------
27,294 14,303
---------- ----------
RETAIL -- 2.5%
800 CVS Caremark Corp. ........................... 30,452 26,928
2,000 The Great Atlantic & Pacific Tea Co. Inc.+ ... 42,749 21,640
---------- ----------
73,201 48,568
---------- ----------
See accompanying notes to financial statements.
4
THE GABELLI SRI FUND, INC.
SCHEDULE OF INVESTMENTS (CONTINUED) -- SEPTEMBER 30, 2008 (UNAUDITED)
MARKET
SHARES COST VALUE
- ----------- ---------- ----------
COMMON STOCKS (CONTINUED)
SPECIALTY CHEMICALS -- 4.3%
500 International Flavors & Fragrances Inc. ...... $ 24,844 $ 19,730
500 Rohm & Haas Co. .............................. 26,909 35,000
400 Sensient Technologies Corp. .................. 10,439 11,252
1,000 Zep Inc. ..................................... 14,892 17,640
---------- ----------
77,084 83,622
---------- ----------
TELECOMMUNICATIONS -- 5.6%
1,000 CenturyTel Inc. .............................. 41,435 36,650
3,000 Sprint Nextel Corp. .......................... 43,484 18,300
1,500 Telephone & Data Systems Inc. ................ 73,965 53,625
---------- ----------
158,884 108,575
---------- ----------
TRANSPORTATION -- 2.0%
1,000 GATX Corp. ................................... 41,170 39,570
---------- ----------
WIRELESS COMMUNICATIONS -- 2.9%
1,200 United States Cellular Corp.+ ................ 80,753 56,304
---------- ----------
TOTAL COMMON STOCKS .......................... 1,872,655 1,527,065
---------- ----------
PRINCIPAL
AMOUNT
- -----------
U.S. GOVERNMENT OBLIGATIONS -- 20.9%
$ 405,000 U.S. Treasury Bills,
0.150% to 1.524%++,
10/16/08 to 12/04/08 ...................... 404,792 404,706
---------- ----------
TOTAL INVESTMENTS -- 99.5% ................... $2,277,447 1,931,771
==========
OTHER ASSETS AND LIABILITIES (NET) -- 0.5% ................. 10,118
----------
NET ASSETS -- 100.0% ....................................... $1,941,889
==========
- ----------
+ Non-income producing security.
++ Represents annualized yield at date of purchase.
ADR American Depositary Receipt
See accompanying notes to financial statements.
5
THE GABELLI SRI FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES
SEPTEMBER 30, 2008 (UNAUDITED)
ASSETS:
Investments, at value (cost $2,277,447) ........................ $1,931,771
Receivable for Fund shares sold ................................ 1,000
Receivable from Adviser ........................................ 17,158
Dividends receivable ........................................... 2,097
Prepaid expenses ............................................... 11,278
----------
TOTAL ASSETS ................................................... 1,963,304
----------
LIABILITIES:
Payable to custodian ........................................... 423
Payable for Fund shares redeemed ............................... 1,000
Payable for distribution fees .................................. 413
Payable for audit fees ......................................... 13,140
Payable for legal fees ......................................... 2,630
Payable for shareholder serving fees ........................... 2,358
Other accrued expenses ......................................... 1,451
----------
TOTAL LIABILITIES .............................................. 21,415
----------
NET ASSETS applicable to 246,512
shares outstanding .......................................... $1,941,889
==========
NET ASSETS CONSIST OF:
Paid-in capital, each class at $0.001 par value ................ $2,293,581
Undistributed net investment income ............................ 7,731
Accumulated net realized loss on investments ................... (13,747)
Net unrealized depreciation on investments ..................... (345,676)
----------
NET ASSETS ..................................................... $1,941,889
==========
SHARES OF CAPITAL STOCK:
CLASS AAA:
Net Asset Value, offering, and redemption price per
share ($652,990 / 82,867 shares outstanding;
500,000,000 shares authorized) .............................. $ 7.88
==========
CLASS A:
Net Asset Value and redemption price per share
($669,209 / 84,971 shares outstanding;
500,000,000 shares authorized) .............................. $ 7.88
==========
Maximum offering price per share (NAV / .9425,
based on maximum sales charge of 5.75% of
the offering price) ......................................... $ 8.36
==========
CLASS C:
Net Asset Value and offering price per share
($166,087 / 21,259 shares outstanding;
500,000,000 shares authorized) .............................. $ 7.81(a)
==========
CLASS I:
Net Asset Value, offering, and redemption price per
share ($453,603 / 57,415 shares outstanding;
500,000,000 shares authorized) .............................. $ 7.90
==========
- ----------
(a) Redemption price varies based on the length of time held.
STATEMENT OF OPERATIONS
FOR THE SIX MONTHS ENDED SEPTEMBER 30, 2008 (UNAUDITED)
INVESTMENT INCOME:
Dividends (net of foreign taxes of $25) ........................ $ 16,692
Interest ....................................................... 1,162
----------
TOTAL INVESTMENT INCOME ........................................ 17,854
----------
EXPENSES:
Investment advisory fees ....................................... 9,210
Distribution fees - Class AAA .................................. 827
Distribution fees - Class A .................................... 638
Distribution fees - Class C .................................... 897
Legal and audit fees ........................................... 21,704
Registration expenses .......................................... 17,496
Shareholder communications expenses ............................ 11,131
Offering expense ............................................... 10,739
Directors' fees ................................................ 10,416
Shareholder services fees ...................................... 6,552
Custodian fees ................................................. 548
Interest expense ............................................... 120
Miscellaneous expenses ......................................... 5,404
----------
TOTAL EXPENSES ................................................. 95,682
----------
LESS:
Fees waived and expenses reimbursed
by Adviser (see Note 3) .................................. (77,082)
----------
NET EXPENSES ................................................... 18,600
----------
NET INVESTMENT LOSS ............................................ (746)
----------
NET REALIZED AND UNREALIZED GAIN/(LOSS)
ON INVESTMENTS:
Net realized loss on investments ............................... (11,331)
Net change in unrealized appreciation/(depreciation)
on investments .............................................. (117,668)
----------
NET REALIZED AND UNREALIZED GAIN/(LOSS)
ON INVESTMENTS . ............................................ (128,999)
----------
NET DECREASE IN NET ASSETS RESULTING
FROM OPERATIONS ............................................. $ (129,745)
==========
See accompanying notes to financial statements.
6
THE GABELLI SRI FUND, INC.
STATEMENT OF CHANGES IN NET ASSETS
SIX MONTHS ENDED
SEPTEMBER 30, 2008 PERIOD ENDED
(UNAUDITED) MARCH 31, 2008 (a)
------------------ ------------------
OPERATIONS:
Net investment income/(loss) .................................. $ (746) $ 337
Net realized gain/(loss) on investments ....................... (11,331) 2,438
Net change in unrealized appreciation/(depreciation)
on investments ............................................. (117,668) (228,008)
---------- ----------
NET DECREASE IN NET ASSETS RESULTING FROM OPERATIONS .......... (129,745) (225,233)
---------- ----------
DISTRIBUTIONS TO SHAREHOLDERS:
Net investment income
Class AAA .................................................. -- (299)
Class A .................................................... -- (146)
Class I .................................................... -- (742)
---------- ----------
-- (1,187)
---------- ----------
Net realized gain on investments
Class AAA .................................................. -- (2,171)
Class A .................................................... -- (470)
Class C .................................................... -- (558)
Class I .................................................... -- (1,655)
---------- ----------
-- (4,854)
---------- ----------
TOTAL DISTRIBUTIONS TO SHAREHOLDERS ........................... -- (6,041)
---------- ----------
CAPITAL SHARE TRANSACTIONS:
Class AAA .................................................. 38,604 669,446
Class A .................................................... 256,204 489,782
Class C .................................................... 14,837 183,055
Class I .................................................... 296 550,684
---------- ----------
NET INCREASE IN NET ASSETS FROM CAPITAL SHARE TRANSACTIONS .... 309,941 1,892,967
---------- ----------
NET INCREASE IN NET ASSETS .................................... 180,196 1,661,693
NET ASSETS:
Beginning of period ........................................... 1,761,693 100,000
---------- ----------
End of period (including undistributed net investment
income of $7,731 and $8,477, respectively) ................. $1,941,889 $1,761,693
========== ==========
- ----------
(a) The Gabelli SRI Fund, Inc. commenced investment operations on June 1, 2007.
See accompanying notes to financial statements.
7
THE GABELLI SRI FUND, INC.
FINANCIAL HIGHLIGHTS (UNAUDITED)
Selected data for a share of capital stock outstanding throughout the period:
INCOME FROM
INVESTMENT OPERATIONS DISTRIBUTIONS
-------------------------------------- ----------------------------------------
Net
Net Asset Net Realized and Total Net Net Asset
Period Value, Investment Unrealized from Net Realized Value,
Ended Beginning Income Loss on Investment Investment Gain on Total End of Total
September 30 of Period (Loss)(a) Investments Operations Income Investments Distributions Period Return+
- ------------ --------- ---------- ------------ ---------- ---------- ----------- ------------- --------- -------
CLASS AAA
2009(d) $ 8.41 $(0.00)(e) $(0.53) $(0.53) -- -- -- $7.88 (6.30)%
2008(g) 10.00 0.01 (1.57) (1.56) $(0.00)(e) $(0.03) $(0.03) 8.41 (15.60)
CLASS A
2009(d) $ 8.40 $(0.00)(e) $(0.52) $(0.52) -- -- -- $7.88 (6.19)%
2008(g) 10.00 (0.00)(e) (1.56) (1.56) $(0.01) $(0.03) $(0.04) 8.40 (15.65)
CLASS C
2009(d) $ 8.37 $(0.04) $(0.52) $(0.56) -- -- -- $7.81 (6.69)%
2008(g) 10.00 (0.06) (1.54) (1.60) -- $(0.03) $(0.03) 8.37 (16.03)
CLASS I
2009(d) $ 8.42 $ 0.01 $(0.53) $(0.52) -- -- -- $7.90 (6.18)%
2008(g) 10.00 0.02 (1.56) (1.54) $(0.01) $(0.03) $(0.04) 8.42 (15.41)
RATIOS TO AVERAGE NET ASSETS/
SUPPLEMENTAL DATA
-----------------------------------------------------------------
Expenses Expenses
Net Assets Net of Before
Period End of Net Waivers/ Waivers/ Portfolio
Ended Period Investment Reimburse- Reimburse- Turnover
September 30 (in 000's) Income (Loss) ments(b)(c) ments Rate
- ------------ ---------- ------------- ----------- ---------- ---------
CLASS AAA
2009(d) $653 (0.08)%(f) 2.01%(f) 10.38%(f) 16%
2008(g) 656 0.11(f) 2.02(f) 22.50(f) 25
CLASS A
2009(d) $669 (0.05)%(f) 2.01%(f) 10.38%(f) 16%
2008(g) 461 (0.06)(f) 2.02(f) 22.50(f) 25
CLASS C
2009(d) $166 (0.87)%(f) 2.76%(f) 11.13%(f) 16%
2008(g) 162 (0.81)(f) 2.77(f) 23.25(f) 25
CLASS I
2009(d) $454 0.17%(f) 1.76%(f) 10.13%(f) 16%
2008(g) 483 0.23(f) 1.77(f) 22.25(f) 25
+ Total return represents aggregate total return of a hypothetical $1,000
investment at the beginning of the period and sold at the end of the period
including reinvestment of distributions and does not reflect applicable
sales charges. Total return for a period of less than one year is not
annualized.
(a) Per share amounts have been calculated using the average shares outstanding
method.
(b) The Fund incurred interest expense during the six months ended September
30, 2008 and the period ended March 31, 2008. If interest expense had not
been incurred, the ratios of operating expenses to average net assets would
have been 2.00% and 2.00% (Class AAA and Class A), 2.75% and 2.75% (Class
C), and 1.75% and 1.75% (Class I), respectively.
(c) The ratios do not include a reduction of expenses for custodian fee credits
on cash balances maintained with the custodian. Including such custodian
fee credits, the expense ratios for the period ended March 31, 2008 would
have been 2.00% (Class AAA and Class A), 2.75% (Class C), and 1.75% (Class
I), respectively. There were no custodian fee credits for the six months
ended September 30, 2008.
(d) For the six months ended September 30, 2008, unaudited.
(e) Amount represents less than $0.005 per share.
(f) Annualized.
(g) The Gabelli SRI Fund, Inc. commenced investment operations on June 1, 2007.
See accompanying notes to financial statements.
8
THE GABELLI SRI FUND, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1. ORGANIZATION. The Gabelli SRI Fund, Inc. (the "Fund") was organized on March
1, 2007 as a Maryland corporation. The Fund is a diversified open-end management
investment company registered under the Investment Company Act of 1940, as
amended (the "1940 Act"). The Fund commenced investment operations on June 1,
2007 ("inception"). The Fund's primary objective is to seek capital
appreciation. The Fund will seek to achieve its objective by investing
substantially all, and in any case, no less than 80% of its assets in common
stocks and preferred stocks of companies that meet the Fund's guidelines for
social responsibility at the time of investment.
2. SIGNIFICANT ACCOUNTING POLICIES. The preparation of financial statements in
accordance with United States ("U.S.") generally accepted accounting principles
requires management to make estimates and assumptions that affect the reported
amounts and disclosures in the financial statements. Actual results could differ
from those estimates. The following is a summary of significant accounting
policies followed by the Fund in the preparation of its financial statements.
SECURITY VALUATION. Portfolio securities listed or traded on a nationally
recognized securities exchange or traded in the U.S. over-the-counter market for
which market quotations are readily available are valued at the last quoted sale
price or a market's official closing price as of the close of business on the
day the securities are being valued. If there were no sales that day, the
security is valued at the average of the closing bid and asked prices or, if
there were no asked prices quoted on that day, then the security is valued at
the closing bid price on that day. If no bid or asked prices are quoted on such
day, the security is valued at the most recently available price or, if the
Board of Directors (the "Board") so determines, by such other method as the
Board shall determine in good faith to reflect its fair market value. Portfolio
securities traded on more than one national securities exchange or market are
valued according to the broadest and most representative market, as determined
by Gabelli Funds, LLC (the "Adviser").
Portfolio securities primarily traded on a foreign market are generally valued
at the preceding closing values of such securities on the relevant market, but
may be fair valued pursuant to procedures established by the Board if market
conditions change significantly after the close of the foreign market but prior
to the close of business on the day the securities are being valued. Debt
instruments with remaining maturities of 60 days or less that are not credit
impaired are valued at amortized cost, unless the Board determines such amount
does not reflect the securities' fair value, in which case these securities will
be fair valued as determined by the Board. Debt instruments having a maturity
greater than 60 days for which market quotations are readily available are
valued at the average of the latest bid and asked prices. If there were no asked
prices quoted on such day, the security is valued using the closing bid price.
Futures contracts are valued at the closing settlement price of the exchange or
board of trade on which the applicable contract is traded.
Securities and assets for which market quotations are not readily available are
fair valued as determined by the Board. Fair valuation methodologies and
procedures may include, but are not limited to: analysis and review of available
financial and non-financial information about the company; comparisons to the
valuation and changes in valuation of similar securities, including a comparison
of foreign securities to the equivalent U.S. dollar value ADR securities at the
close of the U.S. exchange; and evaluation of any other information that could
be indicative of the value of the security.
9
THE GABELLI SRI FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
On April 1, 2008, the Fund adopted Statement of Financial Accounting Standard
No. 157, "Fair Value Measurements" ("SFAS 157") that clarifies the definition of
fair value for financial reporting, establishes a framework for measuring fair
value, and requires additional disclosures about the use of fair value
measurements. The three levels of the fair value hierarchy under SFAS 157 are
described below:
- Level 1 - quoted prices in active markets for identical securities;
- Level 2 - other significant observable inputs (including quoted prices
for similar securities, interest rates, prepayment speeds, credit
risk, etc.); and
- Level 3 - significant unobservable inputs (including the Fund's
determinations as to the fair value of investments).
The inputs or methodology used for valuing securities are not necessarily an
indication of the risk associated with investing in those securities. The
summary of inputs used to value the Fund's net assets as of September 30, 2008
is as follows:
INVESTMENTS IN
SECURITIES
VALUATION INPUTS (MARKET VALUE)
- ---------------- --------------
Level 1 - Quoted Prices $1,527,065
Level 2 - Other Significant Observable Inputs 404,706
----------
TOTAL $1,931,771
==========
In March 2008, the Financial Accounting Standards Board (the "FASB") issued
Statement of Financial Accounting Standard No. 161, "Disclosures about
Derivative Instruments and Hedging Activities" ("SFAS 161") that is effective
for fiscal years beginning after November 15, 2008. SFAS 161 is intended to
improve financial reporting for derivative instruments by requiring enhanced
disclosure that enables investors to understand how and why an entity uses
derivatives, how derivatives are accounted for, and how derivative instruments
affect an entity's results of operations and financial position. Management is
currently evaluating the implications of SFAS 161 on the Fund's financial
statement disclosures.
REPURCHASE AGREEMENTS. The Fund may enter into repurchase agreements with
primary government securities dealers recognized by the Federal Reserve Board,
with member banks of the Federal Reserve System, or with other brokers or
dealers that meet credit guidelines established by the Adviser and reviewed by
the Board. Under the terms of a typical repurchase agreement, the Fund takes
possession of an underlying debt obligation subject to an obligation of the
seller to repurchase, and the Fund to resell, the obligation at an agreed-upon
price and time, thereby determining the yield during the Fund's holding period.
The Fund will always receive and maintain securities as collateral whose market
value, including accrued interest, will be at least equal to 102% of the dollar
amount invested by the Fund in each agreement. The Fund will make payment for
such securities only upon physical delivery or upon evidence of book entry
transfer of the collateral to the account of the custodian. To the extent that
any repurchase transaction exceeds one business day, the value of the collateral
is marked-to-market on a daily basis to maintain the adequacy of the collateral.
If the seller defaults and the value of the collateral declines or if bankruptcy
proceedings are commenced with respect to the seller of the security,
realization of the collateral by the Fund may be delayed or limited. At
September 30, 2008, there were no open repurchase agreements.
10
THE GABELLI SRI FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
SWAP AGREEMENTS. The Fund may enter into equity and contract for difference swap
transactions. The use of swaps is a highly specialized activity that involves
investment techniques and risks different from those associated with ordinary
portfolio security transactions. In a swap, a set of future cash flows are
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. There is no assurance that the swap
contract counterparties will be able to meet their obligations pursuant to the
swap contracts, or that, in the event of default, the Fund will succeed in
pursuing contractual remedies. The Fund thus assumes the risk that it may be
delayed in or prevented from obtaining payments owed to it pursuant to the swap
contracts. The creditworthiness of the swap contract counterparties is closely
monitored in order to minimize the risk. Depending on the general state of
short-term interest rates and the returns of the Fund's portfolio securities at
that point in time, such a default could negatively affect the Fund's ability to
make dividend payments. In addition, at the time a 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. If this occurs, it could have a
negative impact on the Fund's ability to make dividend payments.
The use of derivative instruments involves, to varying degrees, elements of
market and counterparty risk in excess of the amount recognized in the Statement
of Assets and Liabilities. The change in value of swaps, including the accrual
of periodic amounts of interest to be paid or received on swaps, is reported as
unrealized appreciation or depreciation. At September 30, 2008, there were no
open swap agreements.
OPTIONS. The Fund may purchase or write call or put options on securities or
indices. As a writer of put options, the Fund receives a premium at the outset
and then bears the risk of unfavorable changes in the price of the financial
instrument underlying the option. The Fund would incur a loss if the price of
the underlying financial instrument decreases between the date the option is
written and the date on which the option is terminated. The Fund would realize a
gain, to the extent of the premium, if the price of the financial instrument
increases between those dates. If a call option is exercised, the premium is
added to the proceeds from the sale of the underlying security in determining
whether there has been a realized gain or loss. If a put option is exercised,
the premium reduces the cost basis of the security.
As a purchaser of put options, the Fund pays a premium for the right to sell to
the seller of the put option the underlying security at a specified price. The
seller of the put has the obligation to purchase the underlying security upon
exercise at the exercise price. If the price of the underlying security
declines, the Fund would realize a gain upon sale or exercise. If the price of
the underlying security increases or stays the same, the Fund would realize a
loss upon sale or at expiration date, but only to the extent of the premium
paid.
In the case of call options, these exercise prices are referred to as
"in-the-money," "at-the-money," and "out-of-the-money," respectively. The Fund
may write (a) in-the-money call options when the Adviser expects that the price
of the underlying security will remain stable or decline during the option
period, (b) at-the-money call options when the Adviser expects that the price of
the underlying security will remain stable, decline or advance moderately during
the option period, and (c) out-of-the-money call options when the Adviser
expects that the premiums received from writing the call option will be greater
than the appreciation in the price of the underlying security above the exercise
price. By writing a call option, the Fund limits its opportunity to profit from
any increase in the market value of the underlying security above the exercise
price of the option. Out-of-the-money,
11
THE GABELLI SRI FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
at-the-money, and in-the-money put options (the reverse of call options as to
the relation of exercise price to market price) may be utilized in the same
market environments that such call options are used in equivalent transactions.
At September 30, 2008, there were no open options.
FUTURES CONTRACTS. The Fund may engage in futures contracts for the purpose of
hedging against changes in the value of its portfolio securities and in the
value of securities it intends to purchase. Upon entering into a futures
contract, the Fund is required to deposit with the broker an amount of cash or
cash equivalents equal to a certain percentage of the contract amount. This is
known as the "initial margin." Subsequent payments ("variation margin") are made
or received by the Fund each day, depending on the daily fluctuations in the
value of the contract, which are included in unrealized
appreciation/depreciation on investments and futures contracts. The Fund
recognizes a realized gain or loss when the contract is closed.
There are several risks in connection with the use of futures contracts as a
hedging instrument. The change in value of futures contracts primarily
corresponds with the value of their underlying instruments, which may not
correlate with the change in value of the hedged investments. In addition, there
is the risk that the Fund may not be able to enter into a closing transaction
because of an illiquid secondary market. At September 30, 2008, there were no
open futures contracts.
FORWARD FOREIGN EXCHANGE CONTRACTS. The Fund may engage in forward foreign
exchange contracts for hedging a specific transaction with respect to either the
currency in which the transaction is denominated or another currency as deemed
appropriate by the Adviser. Forward foreign exchange contracts are valued at the
forward rate and are marked-to-market daily. The change in market value is
included in unrealized appreciation/depreciation on investments and foreign
currency translations. When the contract is closed, the Fund records a realized
gain or loss equal to the difference between the value of the contract at the
time it was opened and the value at the time it was closed.
The use of forward foreign exchange contracts does not eliminate fluctuations in
the underlying prices of the Fund's portfolio securities, but it does establish
a rate of exchange that can be achieved in the future. Although forward foreign
exchange contracts limit the risk of loss due to a decline in the value of the
hedged currency, they also limit any potential gain that might result should the
value of the currency increase. In addition, the Fund could be exposed to risks
if the counterparties to the contracts are unable to meet the terms of their
contracts. At September 30, 2008, there were no open forward foreign exchange
contracts.
FOREIGN CURRENCY TRANSLATIONS. The books and records of the Fund are maintained
in U.S. dollars. Foreign currencies, investments, and other assets and
liabilities are translated into U.S. dollars at the current exchange rates.
Purchases and sales of investment securities, income, and expenses are
translated at the exchange rate prevailing on the respective dates of such
transactions. Unrealized gains and losses that result from changes in foreign
exchange rates and/or changes in market prices of securities have been included
in unrealized appreciation/depreciation on investments and foreign currency
translations. Net realized foreign currency gains and losses resulting from
changes in exchange rates include foreign currency gains and losses between
trade date and settlement date on investment securities transactions, foreign
currency transactions, and the difference between the amounts of interest and
dividends recorded on the books of the Fund and the amounts actually received.
The portion of foreign currency gains and losses related to fluctuation in
exchange rates between the initial trade date and subsequent sale trade date is
included in realized gain/(loss) on investments.
12
THE GABELLI SRI FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
FOREIGN SECURITIES. The Fund may directly purchase securities of foreign
issuers. Investing in securities of foreign issuers involves special risks not
typically associated with investing in securities of U.S. issuers. The risks
include possible revaluation of currencies, the ability to repatriate funds,
less complete financial information about companies, and possible future adverse
political and economic developments. Moreover, securities of many foreign
issuers and their markets may be less liquid and their prices more volatile than
those of securities of comparable U.S. issuers.
FOREIGN TAXES. The Fund may be subject to foreign taxes on income, gains on
investments, or currency repatriation, a portion of which may be recoverable.
The Fund will accrue such taxes and recoveries as applicable, based upon its
current interpretation of tax rules and regulations that exist in the markets in
which it invests.
RESTRICTED AND ILLIQUID SECURITIES. The Fund may invest up to 15% of its net
assets in securities for which the markets are illiquid. Illiquid securities
include securities the disposition of which is subject to substantial legal or
contractual restrictions. The sale of illiquid securities often requires more
time and results in higher brokerage charges or dealer discounts and other
selling expenses than does the sale of securities eligible for trading on
national securities exchanges or in the over-the-counter markets. Restricted
securities may sell at a price lower than similar securities that are not
subject to restrictions on resale. Securities freely saleable among qualified
institutional investors under special rules adopted by the SEC may be treated as
liquid if they satisfy liquidity standards established by the Board. The
continued liquidity of such securities is not as well assured as that of
publicly traded securities, and accordingly the Board will monitor their
liquidity. At September 30, 2008, the Fund held no restricted and illiquid
securities.
SECURITIES TRANSACTIONS AND INVESTMENT INCOME. Securities transactions are
accounted for on the trade date with realized gain or loss on investments
determined by using the identified cost method. Interest income (including
amortization of premium and accretion of discount) is recorded on the accrual
basis. Premiums and discounts on debt securities are amortized using the
effective yield to maturity method. Dividend income is recorded on the
ex-dividend date except for certain dividends which are recorded as soon as the
Fund is informed of the dividend.
DETERMINATION OF NET ASSET VALUE AND CALCULATION OF EXPENSES. Certain
administrative expenses are common to, and allocated among, various affiliated
funds. Such allocations are made on the basis of each Fund's average net assets
or other criteria directly affecting the expenses as determined by the Adviser
pursuant to procedures established by the Board.
In calculating the NAV per share of each class, investment income, realized and
unrealized gains and losses, redemption fees, and expenses other than class
specific expenses are allocated daily to each class of shares based upon the
proportion of net assets of each class at the beginning of each day.
Distribution expenses are borne solely by the class incurring the expense.
CUSTODIAN FEE CREDITS AND INTEREST EXPENSE. When cash balances are maintained in
the custody account, the Fund receives credits which are used to offset
custodian fees. The gross expenses paid under the custody arrangement are
included in custodian fees in the Statement of Operations with the corresponding
expense offset, if any, shown as "custodian fee credits." When cash balances are
overdrawn, the Fund is charged an overdraft fee equal to 110% of the 90 day
Treasury Bill rate on outstanding balances. This amount, if any, would be shown
as "interest expense" in the Statement of Operations.
13
THE GABELLI SRI FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
DISTRIBUTIONS TO SHAREHOLDERS. Distributions to shareholders are recorded on the
ex-dividend date. Distributions to shareholders are based on income and capital
gains as determined in accordance with federal income tax regulations, which may
differ from income and capital gains as determined under U.S. generally accepted
accounting principles. These differences are primarily due to differing
treatments of income and gains on various investment securities and foreign
currency transactions held by the Fund, timing differences, and differing
characterizations of distributions made by the Fund. Distributions from net
investment income include net realized gains on foreign currency transactions.
These book/tax differences are either temporary or permanent in nature. To the
extent these differences are permanent, adjustments are made to the appropriate
capital accounts in the period when the differences arise. These
reclassifications have no impact on the NAV of the Fund.
The tax character of distributions paid during the period from inception through
March 31, 2008 was $6,041 of ordinary income.
PROVISION FOR INCOME TAXES. The Fund intends to continue to qualify as a
regulated investment company under Subchapter M of the Internal Revenue Code of
1986, as amended (the "Code"). It is the policy of the Fund to comply with the
requirements of the Code applicable to regulated investment companies and to
distribute substantially all of its net investment company taxable income and
net capital gains. Therefore, no provision for federal income taxes is required.
The following summarizes the tax cost of investments and the related unrealized
appreciation/depreciation at September 30, 2008:
GROSS GROSS NET
UNREALIZED UNREALIZED UNREALIZED
COST APPRECIATION DEPRECIATION DEPRECIATION
---------- ------------ ------------ ------------
Investments .......... $2,277,530 $53,383 $(399,142) $(345,759)
FASB Interpretation No. 48, "Accounting for Uncertainty in Income Taxes, an
Interpretation of FASB Statement No. 109" (the "Interpretation") established a
minimum threshold for financial statement recognition of the benefit of
positions taken in filing tax returns (including whether the Fund is taxable in
a particular jurisdiction) and required certain expanded tax disclosures.
For the six months ended September 30, 2008, the Fund did not have any liability
for any unrecognized tax benefits. The Fund recognizes interest and penalties,
if any, related to unrecognized tax benefits as income tax expense in the
Statement of Operations.
3. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS. The Fund has an
investment advisory agreement (the "Advisory Agreement") with the Adviser which
provides that the Fund will pay the Adviser a fee, computed daily and paid
monthly, at the annual rate of 1.00% of the value of its average daily net
assets. In accordance with the Advisory Agreement, the Adviser provides a
continuous investment program for the Fund's portfolio, oversees the
administration of all aspects of the Fund's business and affairs, and pays the
compensation of all Officers and Directors of the Fund who are affiliated
persons of the Adviser. The Adviser has contractually agreed to waive its
investment advisory fee and/or to reimburse expenses of the Fund to the extent
necessary to maintain the annualized total operating expenses of the Fund
(excluding brokerage, interest, taxes, and extraordinary expenses) until at
least March 31, 2009, at no more than 2.00%, 2.00%, 2.75%, and 1.75% of the
value of the Fund's average daily net assets for Class AAA, Class A, Class C,
and Class I, respectively.
14
THE GABELLI SRI FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
For the six months ended September 30, 2008, the Adviser reimbursed the Fund in
the amount of $77,082. In addition, the Fund has agreed, during the three year
period following any waiver or reimbursement by the Adviser, to repay such
amount to the extent, after giving effect to the repayment, such adjusted
annualized total operating expenses of the Fund would not exceed 2.00%, 2.00%,
2.75%, and 1.75% of the value of the Fund's average daily net assets for Class
AAA, Class A, Class C, and Class I, respectively. At September 30, 2008, the
cumulative amount which the Fund may repay the Adviser is $274,402.
The Fund pays each Director who is not considered to be an affiliated person an
annual retainer of $3,000 plus $500 for each Board meeting attended and they are
reimbursed for any out of pocket expenses incurred in attending meetings. All
Board committee members receive $500 per meeting attended and the Chairman of
the Audit, Nominating, and Proxy Voting Committees and the Lead Director each
receive an annual fee of $1,000. Directors who are directors or employees of the
Adviser or an affiliated company receive no compensation or expense
reimbursement from the Fund.
4. DISTRIBUTION PLAN. The Fund's Board has adopted a distribution plan (the
"Plan") for each class of shares, except Class I Shares, pursuant to Rule 12b-1
under the 1940 Act. Gabelli & Company, Inc. ("Gabelli & Company"), an affiliate
of the Adviser, serves as distributor of the Fund. Under the Class AAA, Class A,
and Class C Share Plans, payments are authorized to Gabelli & Company at annual
rates of 0.25%, 0.25%, and 1.00%, respectively, of the average daily net assets
of those classes, the annual limitations under each Plan. Such payments are
accrued daily and paid monthly.
5. PORTFOLIO SECURITIES. Purchases and proceeds from the sales of securities for
the six months ended September 30, 2008, other than short-term securities and
U.S. Government obligations, aggregated $593,065 and $258,710, respectively.
6. TRANSACTIONS WITH AFFILIATES. For the six months ended September 30, 2008,
the Fund paid brokerage commissions on security trades of $514 to Gabelli &
Company. Additionally, Gabelli & Company informed the Fund that it received
$1,931 from investors representing commissions (sales charges and underwriting
fees) on sales and redemptions of Fund shares.
The cost of calculating the Fund's NAV per share is a Fund expense pursuant to
the Advisory Agreement between the Fund and the Adviser. A reimbursement was not
sought by the Adviser during the six months ended September 30, 2008.
7. CAPITAL STOCK TRANSACTIONS. The Fund currently offers four classes of shares
- - Class AAA Shares, Class A Shares, Class C Shares, and Class I Shares. Class
AAA Shares are offered only to investors who acquire them directly from Gabelli
& Company, or through selected broker/dealers, or the transfer agent without a
sales charge. Class A Shares are subject to a maximum front-end sales charge of
5.75%. Class C Shares are subject to a 1.00% CDSC for one year after purchase.
Class I Shares are offered to institutional investors that acquire the Fund
directly through Gabelli & Company.
The Fund imposes a redemption fee of 2.00% on all classes of shares that are
redeemed or exchanged on or before the seventh day after the date of a
purchase. The redemption fee is deducted from the proceeds otherwise payable to
the redeeming shareholders and is retained by the Fund. The Fund did not retain
any redemption fees during the six months ended September 30, 2008 or during the
fiscal year ended March 31, 2008.
15
THE GABELLI SRI FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
The redemption fee does not apply to redemptions of shares where (i) the shares
were purchased through automatic reinvestment of distributions, (ii) the
redemption was initiated by the Fund, (iii) the shares were purchased through
programs that collect the redemption fee at the program level and remit them to
the Fund, or (iv) the shares were purchased through programs that the Adviser
determines to have appropriate anti-short-term trading policies in place or as
to which the Adviser has received assurances that look-through redemption fee
procedures or effective anti-short-term trading policies and procedures are in
place.
Transactions in shares of capital stock were as follows:
SIX MONTHS ENDED
SEPTEMBER 30, 2008 PERIOD ENDED
(UNAUDITED) MARCH 31, 2008 (a)
------------------ -------------------
SHARES AMOUNT SHARES AMOUNT
------- -------- ------- ---------
CLASS AAA CLASS AAA
------------------ -------------------
Initial seed capital, May 21, 2007 ................. -- -- 10,000 $100,000
Shares sold ........................................ 9,044 $ 74,577 72,414 708,009
Shares issued upon reinvestment of distributions ... -- -- 261 2,383
Shares redeemed .................................... (4,222) (35,973) (4,630) (40,946)
------ -------- ------ --------
Net increase .................................... 4,822 $ 38,604 78,045 $769,446
====== ======== ====== ========
CLASS A CLASS A
------------------ -------------------
Shares sold ........................................ 31,988 $272,283 55,735 $498,947
Shares issued upon reinvestment of distributions ... -- -- 55 502
Shares redeemed .................................... (1,827) (16,079) (980) (9,667)
------ -------- ------ --------
Net increase .................................... 30,161 $256,204 54,810 $489,782
====== ======== ====== ========
CLASS C CLASS C
------------------ -------------------
Shares sold ........................................ 7,160 $ 58,889 19,259 $182,516
Shares issued upon reinvestment of distributions ... -- -- 61 558
Shares redeemed .................................... (5,219) (44,052) (2) (19)
------ -------- ------ --------
Net increase .................................... 1,941 $ 14,837 19,318 $183,055
====== ======== ====== ========
CLASS I CLASS I
------------------ -------------------
Shares sold ........................................ 75 $ 404 57,091 $548,287
Shares issued upon reinvestment of distributions ... -- -- 262 2,397
Shares redeemed .................................... (13) (108) -- --
------ -------- ------ --------
Net increase .................................... 62 $ 296 57,353 $550,684
====== ======== ====== ========
- ----------
(a) The Gabelli SRI Fund, Inc. commenced investment operations on June 1, 2007.
8. INDEMNIFICATIONS. The Fund enters into contracts that contain a variety of
indemnifications. The Fund's maximum exposure under these arrangements is
unknown. However, the Fund has not had prior claims or losses pursuant to these
contracts and expects the risk of loss to be remote.
16
THE GABELLI SRI FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED) (UNAUDITED)
9. OTHER MATTERS. On April 24, 2008, the Adviser entered into an administrative
settlement with the SEC to resolve the SEC's inquiry regarding prior frequent
trading activity in shares of the GAMCO Global Growth Fund, (the "Global Growth
Fund") by one investor who was banned from the Global Growth Fund in August
2002. In the settlement, the SEC found that the Adviser had violated Section
206(2) of the Investment Advisers Act, Section 17(d) of the 1940 Act and Rule
17d-1 thereunder, and had aided and abetted and caused violations of Section
12(d)(1)(B)(i) of the 1940 Act. Under the terms of the settlement, the Adviser,
while neither admitting nor denying the SEC's findings and allegations, agreed,
among other things, to pay the previously reserved total of $16 million
(including a $5 million penalty), of which at least $11 million will be
distributed to shareholders of the Global Growth Fund in accordance with a plan
to be developed by an independent distribution consultant and approved by the
independent directors of the Global Growth Fund and the staff of the SEC, and to
cease and desist from future violations of the above referenced federal
securities laws. The settlement will not have a material adverse impact on the
Adviser or its ability to fulfill its obligations under the Advisory Agreement.
On the same day, the SEC filed a civil action against the Executive Vice
President and Chief Operating Officer of the Adviser, alleging violations of
certain federal securities laws arising from the same matter. The officer is
also an officer of the Global Growth Fund and other funds in the Gabelli/GAMCO
fund complex. The officer denies the allegations and is continuing in his
positions with the Adviser and the funds. The Adviser currently expects that any
resolution of the action against the officer will not have a material adverse
impact on the Adviser or its ability to fulfill its obligations under the
Advisory Agreement.
In a separate matter, in August 2008, the Adviser, while neither admitting nor
denying the SEC's findings and allegations, made an offer to the staff of the
SEC to settle a previously disclosed matter concerning compliance with Section
19(a) and Rule 19a-1 of the 1940 Act by two closed-end funds managed by the
Adviser. These provisions require registered investment companies to provide
written statements to shareholders when a distribution is made in the nature of
a dividend from a source other than net investment income. While the two funds
sent annual statements and provided other materials containing this information,
the funds did not send the notices required by Rule 19a-1 to shareholders with
each distribution in 2002 and 2003. The Adviser believes that the funds have
been in compliance with Rule 19a-1 since that time. The Adviser believes that
the settlement would have no effect on the funds or any material adverse effect
on the Adviser or its ability to manage the funds. This offer of settlement is
subject to final agreement regarding the specific language of the SEC's
administrative order and other settlement documents and approval by the SEC.
17
GABELLI/GAMCO FUNDS AND YOUR PERSONAL PRIVACY
WHO ARE WE?
The Gabelli/GAMCO Funds are investment companies registered with the Securities
and Exchange Commission under the Investment Company Act of 1940. We are managed
by Gabelli Funds, LLC or Teton Advisors, Inc., which are affiliated with GAMCO
Investors, Inc. GAMCO Investors, Inc. is a publicly held company that has
subsidiaries that provide investment advisory or brokerage services for a
variety of clients.
WHAT KIND OF NON-PUBLIC INFORMATION DO WE COLLECT ABOUT YOU IF YOU BECOME A
SHAREHOLDER?
If you apply to open an account directly with us, you will be giving us some
non-public information about yourself. The non-public information we collect
about you is:
- - INFORMATION YOU GIVE US ON YOUR APPLICATION FORM. This could include your
name, address, telephone number, social security number, bank account
number, and other information.
- - INFORMATION ABOUT YOUR TRANSACTIONS WITH US, ANY TRANSACTIONS WITH OUR
AFFILIATES, AND TRANSACTIONS WITH THE ENTITIES WE HIRE TO PROVIDE SERVICES
TO YOU. This would include information about the shares that you buy or
redeem. If we hire someone else to provide services--like a transfer
agent--we will also have information about the transactions that you
conduct through them.
WHAT INFORMATION DO WE DISCLOSE AND TO WHOM DO WE DISCLOSE IT?
We do not disclose any non-public personal information about our customers or
former customers to anyone other than our affiliates, our service providers who
need to know such information, and as otherwise permitted by law. If you want to
find out what the law permits, you can read the privacy rules adopted by the
Securities and Exchange Commission. They are in volume 17 of the Code of Federal
Regulations, Part 248. The Commission often posts information about its
regulations on its website, www.sec.gov.
WHAT DO WE DO TO PROTECT YOUR PERSONAL INFORMATION?
We restrict access to non-public personal information about you to the people
who need to know that information in order to provide services to you or the
Fund and to ensure that we are complying with the laws governing the securities
business. We maintain physical, electronic, and procedural safeguards to keep
your personal information confidential.
GABELLI FAMILY OF FUNDS
VALUE
GABELLI ASSET FUND
Seeks to invest primarily in a diversified portfolio of common stocks selling at
significant discounts to their private market value. The Fund's primary
objective is growth of capital. (MULTICLASS)
PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
GABELLI BLUE CHIP VALUE FUND
Seeks long term growth of capital through investment primarily in the common
stocks of established companies which are temporarily out of favor. The fund's
objective is to identify a catalyst or sequence of events that will return the
company to a higher value. (MULTICLASS)
PORTFOLIO MANAGER: BARBARA MARCIN, CFA
GAMCO WESTWOOD EQUITY FUND
Seeks to invest primarily in the common stock of well seasoned companies that
have recently reported positive earnings surprises and are trading below
Westwood's proprietary growth rate estimates. The Fund's primary objective is
capital appreciation. (MULTICLASS)
PORTFOLIO MANAGER: SUSAN M. BYRNE
FOCUSED VALUE
GABELLI VALUE FUND
Seeks to invest in securities of companies believed to be undervalued. The
Fund's primary objective is long-term capital appreciation. (MULTICLASS)
PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
SMALL CAP VALUE
GABELLI SMALL CAP FUND
Seeks to invest primarily in common stock of smaller companies (market
capitalizations at the time of investment of $2 billion or less) believed to
have rapid revenue and earnings growth potential. The Fund's primary objective
is capital appreciation. (MULTICLASS)
PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
GAMCO WESTWOOD SMALLCAP EQUITY FUND
Seeks to invest primarily in smaller capitalization equity securities - market
caps of $2.5 billion or less. The Fund's primary objective is long-term capital
appreciation. (MULTICLASS)
PORTFOLIO MANAGER: NICHOLAS F. GALLUCCIO
GABELLI WOODLAND SMALL CAP VALUE FUND
Seeks to invest primarily in the common stocks of smaller companies (market
capitalizations generally less than $3.0 billion) believed to be undervalued
with shareholder oriented management teams that are employing strategies to grow
the company's value. The Fund's primary objective is capital appreciation.
(MULTICLASS)
PORTFOLIO MANAGER: ELIZABETH M. LILLY, CFA
GROWTH
GAMCO GROWTH FUND
Seeks to invest primarily in large cap stocks believed to have favorable, yet
undervalued, prospects for earnings growth. The Fund's primary objective is
capital appreciation. (MULTICLASS)
PORTFOLIO MANAGER: HOWARD F. WARD, CFA
GAMCO INTERNATIONAL GROWTH FUND
Seeks to invest in the equity securities of foreign issuers with long-term
capital appreciation potential. The Fund offers investors global
diversification. (MULTICLASS)
PORTFOLIO MANAGER: CAESAR BRYAN
AGGRESSIVE GROWTH
GAMCO GLOBAL GROWTH FUND
Seeks capital appreciation through a disciplined investment program focusing on
the globalization and interactivity of the world's marketplace. The Fund invests
in companies at the forefront of accelerated growth. The Fund's primary
objective is capital appreciation. (MULTICLASS)
TEAM MANAGED
MICRO-CAP
GAMCO WESTWOOD MIGHTY MITESSM FUND
Seeks to invest in micro-cap companies that have market capitalizations of $300
million or less. The Fund's primary objective is long-term capital appreciation.
(MULTICLASS)
TEAM MANAGED
EQUITY INCOME
GABELLI EQUITY INCOME FUND
Seeks to invest primarily in equity securities with above average market yields.
The Fund pays monthly dividends and seeks a high level of total return with an
emphasis on income. (MULTICLASS)
PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
GAMCO WESTWOOD BALANCED FUND
Seeks to invest in a balanced and diversified portfolio of stocks and bonds. The
Fund's primary objective is both capital appreciation and current income.
(MULTICLASS)
CO-PORTFOLIO MANAGERS: SUSAN M. BYRNE
MARK FREEMAN, CFA
GAMCO WESTWOOD INCOME FUND
Seeks to provide a high level of current income as well as long-term capital
appreciation by investing in income producing equity and fixed income
securities. (MULTICLASS)
PORTFOLIO MANAGER: BARBARA MARCIN, CFA
SPECIALTY EQUITY
GAMCO GLOBAL CONVERTIBLE SECURITIES FUND
Seeks to invest principally in bonds and preferred stocks which are convertible
into common stock of foreign and domestic companies. The Fund's primary
objective is total return through a combination of current income and capital
appreciation. (MULTICLASS)
TEAM MANAGED
GAMCO GLOBAL OPPORTUNITY FUND
Seeks to invest in common stock of companies which have rapid growth in revenues
and earnings and potential for above average capital appreciation or are
undervalued. The Fund's primary objective is capital appreciation. (MULTICLASS)
TEAM MANAGED
GABELLI SRI FUND
Seeks to invest in common and preferred stocks of companies that meet the Fund's
guidelines for social responsibility at the time of investment, looking to avoid
companies in tobacco, alcohol, and gaming, defense/weapons contractors, and
manufacturers of abortifacients. The Fund's primary objective is capital
appreciation. (MULTICLASS)
PORTFOLIO MANAGER: CHRISTOPHER C. DESMARAIS
SECTOR
GAMCO GLOBAL TELECOMMUNICATIONS FUND
Seeks to invest in telecommunications companies throughout the world - targeting
undervalued companies with strong earnings and cash flow dynamics. The Fund's
primary objective is capital appreciation. (MULTICLASS)
TEAM MANAGED
GAMCO GOLD FUND
Seeks to invest in a global portfolio of equity securities of gold mining and
related companies. The Fund's objective is long-term capital appreciation.
Investment in gold stocks is considered speculative and is affected by a variety
of worldwide economic, financial, and political factors. (MULTICLASS)
PORTFOLIO MANAGER: CAESAR BRYAN
GABELLI UTILITIES FUND
Seeks to provide a high level of total return through a combination of capital
appreciation and current income. (MULTICLASS)
TEAM MANAGED
MERGER AND ARBITRAGE
GABELLI ABC FUND
Seeks to invest in securities with attractive opportunities for appreciation or
investment income. The Fund's primary objective is total return in various
market conditions without excessive risk of capital loss. (NO-LOAD)
PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
GABELLI ENTERPRISE MERGERS AND ACQUISITIONS FUND
Seeks to invest in securities believed to be likely acquisition targets within
12-18 months or in arbitrage transactions of publicly announced mergers or other
corporate reorganizations. The Fund's primary objective is capital appreciation.
(MULTICLASS)
PORTFOLIO MANAGER: MARIO J. GABELLI, CFA
CONTRARIAN
GAMCO MATHERS FUND
Seeks long-term capital appreciation in various market conditions without
excessive risk of capital loss. (NO-LOAD)
PORTFOLIO MANAGER: HENRY VAN DER EB, CFA
COMSTOCK CAPITAL VALUE FUND
Seeks capital appreciation and current income. The Fund may use either long or
short positions to achieve its objective. (MULTICLASS)
PORTFOLIO MANAGER: MARTIN WEINER, CFA
COMSTOCK STRATEGY FUND
The Fund emphasizes investments in debt securities, which maximize total return
in light of credit risk, interest rate risk, and the risk associated with the
length of maturity of debt instruments. (MULTICLASS)
PORTFOLIO MANAGER: MARTIN WEINER, CFA
FIXED INCOME
GAMCO WESTWOOD INTERMEDIATE BOND FUND
Seeks to invest in a diversified portfolio of bonds with various maturities. The
Fund's primary objective is total return. (MULTICLASS)
PORTFOLIO MANAGER: MARK FREEMAN, CFA
CASH MANAGEMENT-MONEY MARKET
GABELLI U.S. TREASURY MONEY MARKET FUND
Seeks to invest exclusively in short-term U.S. Treasury securities. The Fund's
primary objective is to provide high current income consistent with the
preservation of principal and liquidity. (NO-LOAD)
CO-PORTFOLIO MANAGERS: JUDITH A. RANERI
RONALD S. EAKER
AN INVESTMENT IN THE ABOVE MONEY MARKET FUND IS NEITHER INSURED NOR GUARANTEED
BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY GOVERNMENT AGENCY. ALTHOUGH
THE FUND SEEKS TO PRESERVE THE VALUE OF YOUR INVESTMENT AT $1.00 PER SHARE, IT
IS POSSIBLE TO LOSE MONEY BY INVESTING IN THE FUND.
THE FUNDS MAY INVEST IN FOREIGN SECURITIES WHICH INVOLVE RISKS NOT ORDINARILY
ASSOCIATED WITH INVESTMENTS IN DOMESTIC ISSUES, INCLUDING CURRENCY FLUCTUATION,
ECONOMIC, AND POLITICAL RISKS.
TO RECEIVE A PROSPECTUS, CALL 800-GABELLI (422-3554). INVESTORS SHOULD CAREFULLY
CONSIDER THE INVESTMENT OBJECTIVES, RISKS, CHARGES, AND EXPENSES OF THE FUND
BEFORE INVESTING. THE PROSPECTUS CONTAINS MORE INFORMATION ABOUT THIS AND OTHER
MATTERS AND SHOULD BE READ CAREFULLY BEFORE INVESTING.
(GRAPHIC)
THE GABELLI SRI FUND, INC.
SEMI ANNUAL REPORT
SEPTEMBER 30, 2008
THE GABELLI SRI FUND, INC.
One Corporate Center
Rye, New York 10580-1422
800-GABELLI
800-422-3554
FAX: 914-921-5118
WEBSITE: www.gabelli.com
E-MAIL: Info@gabelli.com
Net Asset Value per share available daily by calling
800-GABELLI after 6:00 P.M.
BOARD OF DIRECTORS
Mario J. Gabelli, CFA
CHAIRMAN AND CHIEF
EXECUTIVE OFFICER,
GAMCO INVESTORS, INC.
Vincent D. Enright
FORMER SENIOR VICE PRESIDENT
AND CHIEF FINANCIAL OFFICER
KEYSPAN CORP.
Clarence A. Davis
CHIEF EXECUTIVE OFFICER,
NESTOR, INC.
Anthonie C. van Ekris
CHAIRMAN, BALMAC
INTERNATIONAL, INC.
OFFICERS
Bruce N. Alpert
PRESIDENT AND SECRETARY
Peter D. Goldstein
CHIEF COMPLIANCE OFFICER
Agnes Mullady
TREASURER
DISTRIBUTOR
Gabelli & Company, Inc.
CUSTODIAN
The Bank of New York Mellon
LEGAL COUNSEL
Paul, Hastings, Janofsky & Walker LLP
This report is submitted for the general information of the shareholders of The
Gabelli SRI Fund, Inc. It is not authorized for distribution to prospective
investors unless preceded or accompanied by an effective prospectus.
GAB1794Q208SR
ITEM 2. CODE OF ETHICS.
Not applicable.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. INVESTMENTS.
(a) Schedule of Investments in securities of unaffiliated issuers as of the
close of the reporting period is included as part of the report to
shareholders filed under Item 1 of this form.
(b) Not applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no material changes to the procedures by which the shareholders
may recommend nominees to the registrant's board of directors, where those
changes were implemented after the registrant last provided disclosure in
response to the requirements of Item 407(c)(2)(iv) of Regulation S-K (17 CFR
229.407) (as required by Item 22(b)(15) of Schedule 14A (17 CFR 240.14a-101)),
or this Item.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive and principal financial
officers, or persons performing similar functions, have concluded
that the registrant's disclosure controls and procedures (as
defined in Rule 30a-3(c) under the Investment Company Act of 1940,
as amended (the "1940 Act") (17 CFR 270.30a-3(c))) are effective,
as of a date within 90 days of the filing date of the report that
includes the disclosure required by this paragraph, based on their
evaluation of these controls and procedures required by Rule
30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rules
13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934,
as amended (17 CFR 240.13a-15(b) or 240.15d-15(b)).
(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the 1940 Act
(17 CFR 270.30a-3(d)) that occurred during the registrant's second
fiscal quarter of the period covered by this report that has
materially affected, or is reasonably likely to materially affect,
the registrant's internal control over financial reporting.
ITEM 12. EXHIBITS.
(a)(1) Not applicable.
(a)(2) Certifications pursuant to Rule 30a-2(a) under the 1940 Act and
Section 302 of the Sarbanes-Oxley Act of 2002 are attached hereto.
(a)(3) Not applicable.
(b) Certifications pursuant to Rule 30a-2(b) under the 1940 Act and
Section 906 of the Sarbanes-Oxley Act of 2002 are attached hereto.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(registrant) The Gabelli SRI Fund, Inc.
--------------------------------------------------------------------
By (Signature and Title)* /s/ Bruce N. Alpert
-------------------------------------------------------
Bruce N. Alpert, Principal Executive Officer
Date 12/2/08
----------------------------------------------------------------------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ Bruce N. Alpert
-------------------------------------------------------
Bruce N. Alpert, Principal Executive Officer
Date 12/2/08
----------------------------------------------------------------------------
By (Signature and Title)* /s/ Agnes Mullady
-------------------------------------------------------
Agnes Mullady,
Principal Financial Officer and Treasurer
Date 12/2/08
----------------------------------------------------------------------------
* Print the name and title of each signing officer under his or her signature.