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 811-08476
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The Gabelli Global Multimedia Trust Inc.
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(Exact name of registrant as specified in charter)
One Corporate Center
Rye, New York 10580-1422
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(Address of principal executive offices) (Zip code)
Bruce N. Alpert
Gabelli Funds, LLC
One Corporate Center
Rye, New York 10580-1422
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(Name and address of agent for service)
registrant's telephone number, including area code: 1-800-422-3554
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Date of fiscal year end: December 31
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Date of reporting period: December 31, 2007
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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.
[LOGO]
THE GABELLI
GLOBAL
MULTIMEDIA
TRUST INC.
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
Annual Report
December 31, 2007
TO OUR SHAREHOLDERS,
The Sarbanes-Oxley Act requires a fund's principal executive and financial
officers to certify the entire contents of the semi-annual and annual
shareholder reports in a filing with the Securities and Exchange Commission on
Form N-CSR. This certification would cover the portfolio managers' commentary
and subjective opinions if they are attached to or a part of the financial
statements. Many of these comments and opinions would be difficult or impossible
to certify.
Because we do not want our portfolio managers to eliminate their opinions
and/or restrict their commentary to historical facts, we have separated their
commentary from the financial statements and investment portfolio and have sent
it to you separately. Both the commentary and the financial statements,
including the portfolio of investments, will be available on our website at
www.gabelli.com.
Enclosed are the audited financial statements and the investment portfolio
as of December 31, 2007.
COMPARATIVE RESULTS
--------------------------------------------------------------------------------
AVERAGE ANNUAL RETURNS THROUGH DECEMBER 31, 2007 (a)
----------------------------------------------------
Since
Inception
Quarter 1 Year 3 Year 5 Year 10 Year (11/15/94)
------- ------ ------ ------ ------- ----------
GABELLI GLOBAL MULTIMEDIA TRUST
NAV TOTAL RETURN (b) ....................... (6.86)% 7.37% 10.85% 16.86% 10.38% 12.03%
INVESTMENT TOTAL RETURN (c) ................ (4.46) 11.13 12.69 19.02 11.07 11.71
Nasdaq Composite Index ........................ (1.82) 9.81 6.83 14.71 5.38 9.93
MSCI World Free Index ......................... (2.42) 9.04 12.75 16.96 6.99 9.15(d)
Lipper Global Multi-Cap Growth Fund Average ... (0.63) 15.75 15.35 18.65 10.16 11.23
(a) RETURNS REPRESENT PAST PERFORMANCE AND DO NOT GUARANTEE FUTURE RESULTS.
INVESTMENT RETURNS AND THE PRINCIPAL VALUE OF AN INVESTMENT WILL
FLUCTUATE. WHEN SHARES ARE SOLD, THEY MAY BE WORTH MORE OR LESS THAN THEIR
ORIGINAL COST. 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. PERFORMANCE RETURNS FOR
PERIODS LESS THAN ONE YEAR ARE NOT ANNUALIZED. INVESTORS SHOULD CAREFULLY
CONSIDER THE INVESTMENT OBJECTIVES, RISKS, CHARGES, AND EXPENSES OF THE
FUND BEFORE INVESTING. THE NASDAQ COMPOSITE AND MSCI WORLD FREE INDICES
ARE UNMANAGED INDICATORS OF STOCK MARKET PERFORMANCE. THE LIPPER GLOBAL
MULTI-CAP GROWTH FUND AVERAGE REFLECTS THE AVERAGE PERFORMANCE OF OPEN-END
MUTUAL FUNDS CLASSIFIED IN THIS PARTICULAR CATEGORY. DIVIDENDS ARE
CONSIDERED REINVESTED EXCEPT FOR THE NASDAQ COMPOSITE AND MSCI WORLD FREE
INDICES. YOU CANNOT INVEST DIRECTLY IN AN INDEX.
(b) TOTAL RETURNS AND AVERAGE ANNUAL RETURNS REFLECT CHANGES IN THE NET ASSET
VALUE ("NAV") PER SHARE, REINVESTMENT OF DISTRIBUTIONS AT NAV ON THE
EX-DIVIDEND DATE, AND ADJUSTMENTS FOR RIGHTS OFFERINGS AND ARE NET OF
EXPENSES. SINCE INCEPTION RETURN IS BASED ON AN INITIAL NAV OF $7.50.
(c) TOTAL RETURNS AND AVERAGE ANNUAL RETURNS REFLECT CHANGES IN CLOSING MARKET
VALUES ON THE NEW YORK STOCK EXCHANGE, REINVESTMENT OF DISTRIBUTIONS, AND
ADJUSTMENTS FOR RIGHTS OFFERINGS. SINCE INCEPTION RETURN IS BASED ON AN
INITIAL OFFERING PRICE OF $7.50.
(d) FROM NOVEMBER 30, 1994, THE DATE CLOSEST TO THE FUND'S INCEPTION FOR WHICH
DATA IS AVAILABLE.
--------------------------------------------------------------------------------
Sincerely yours,
/s/ Bruce N. Alpert
Bruce N. Alpert
February 22, 2008 President
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
SUMMARY OF PORTFOLIO HOLDINGS (UNAUDITED)
The following table presents portfolio holdings as a percent of total
investments as of December 31, 2007:
Entertainment ...................................................... 19.5%
Hotels and Gaming .................................................. 11.5%
Cable .............................................................. 8.7%
Publishing ......................................................... 7.7%
Broadcasting ....................................................... 7.6%
Telecommunications: Regional ....................................... 7.4%
Wireless Communications ............................................ 6.4%
Telecommunications: National ....................................... 6.3%
Computer Software and Services ..................................... 4.4%
U.S. Government Obligations ........................................ 4.2%
Consumer Services .................................................. 3.6%
Telecommunications: Long Distance .................................. 2.5%
Electronics ........................................................ 1.9%
Diversified Industrial ............................................. 1.7%
Equipment .......................................................... 1.7%
Satellite .......................................................... 1.7%
Consumer Products .................................................. 1.0%
Business Services: Advertising ..................................... 1.0%
Business Services .................................................. 0.6%
Energy and Utilities ............................................... 0.2%
Computer Hardware .................................................. 0.2%
Food and Beverage .................................................. 0.1%
Financial Services ................................................. 0.1%
Retail ............................................................. 0.0%
-----
100.0%
=====
THE GABELLI GLOBAL MULTIMEDIA TRUST INC. (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 SEPTEMBER 30, 2007. 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.
2
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
SCHEDULE OF INVESTMENTS
DECEMBER 31, 2007
MARKET
SHARES COST VALUE
---------- ------------ ------------
COMMON STOCKS -- 95.8%
COPYRIGHT/CREATIVITY COMPANIES -- 42.5%
BUSINESS SERVICES: ADVERTISING -- 1.0%
50,000 Clear Channel Outdoor
Holdings Inc., Cl. A+ ............. $ 1,136,550 $ 1,383,000
20,000 Harte-Hanks Inc. .................... 147,611 346,000
4,200 Havas SA ............................ 20,733 20,510
8,000 JC Decaux SA ........................ 196,558 314,634
2,000 Publicis Groupe ..................... 13,971 78,307
4,000 R. H. Donnelley Corp.+ .............. 47,531 145,920
37,240 Trans-Lux Corp.+ .................... 274,753 238,336
------------ ------------
1,837,707 2,526,707
------------ ------------
COMPUTER HARDWARE -- 0.2%
2,200 Apple Inc.+ ......................... 135,501 435,776
------------ ------------
COMPUTER SOFTWARE AND SERVICES -- 4.4%
50,000 Activision Inc.+ .................... 602,858 1,485,000
21,500 Alibaba.com Ltd.+ (a) ............... 37,826 76,240
5,000 America Online Latin
America Inc., Cl. A+ (b) .......... 2,150 10
3,000 Atlus Co. Ltd.+ ..................... 17,662 16,811
2,000 Audible Inc.+ ....................... 20,732 17,840
8,000 CNET Networks Inc.+ ................. 53,895 73,120
20,000 Cognos Inc.+ ........................ 1,149,500 1,151,400
1,230 EarthLink Inc.+ ..................... 17,232 8,696
5,000 eBay Inc.+ .......................... 165,490 165,950
3,000 Electronic Arts Inc.+ ............... 128,251 175,230
1,000 EMC Corp.+ .......................... 6,600 18,530
4,400 Google Inc., Cl. A+ ................. 2,081,801 3,042,512
10,000 Jupitermedia Corp.+ ................. 12,067 38,200
18,000 Limelight Networks Inc.+ ............ 155,024 124,020
20,000 NAVTEQ Corp.+ ....................... 1,347,588 1,512,000
141,000 Yahoo! Inc.+ ........................ 3,779,322 3,279,660
------------ ------------
9,577,998 11,185,219
------------ ------------
CONSUMER PRODUCTS -- 1.0%
2,000 Lenox Group Inc.+ ................... 16,262 5,280
20,000 Mattel Inc. ......................... 325,232 380,800
3,600 Nintendo Co. Ltd. ................... 1,052,614 2,155,843
------------ ------------
1,394,108 2,541,923
------------ ------------
ELECTRONICS -- 1.9%
3,000 IMAX Corp.+ ......................... 22,733 20,460
35,000 Intel Corp. ......................... 871,291 933,100
11,000 LSI Corp.+ .......................... 52,972 58,410
3,570 Royal Philips Electronics NV ........ 29,368 152,618
10,000 Samsung Electronics Co. Ltd.,
GDR (a) ........................... 1,805,500 2,969,927
10,000 Sony Corp., ADR ..................... 353,687 543,000
4,000 Zoran Corp.+ ........................ 62,419 90,040
------------ ------------
3,197,970 4,767,555
------------ ------------
ENTERTAINMENT -- 14.8%
240,000 Aruze Corp. ......................... 5,785,919 9,108,893
1,161 Corporacion Interamericana de
Entretenimiento SAB de CV,
Cl. B+ ............................ 2,441 3,245
22,000 Crown Media Holdings Inc.,
Cl. A+ ............................ 106,890 143,000
27,000 DreamWorks Animation
SKG Inc., Cl. A+ .................. 649,933 689,580
27,300 EMI Group plc, ADR .................. 348,930 275,730
210,416 Gemstar-TV Guide
International Inc.+ ............... 977,254 1,001,580
MARKET
SHARES COST VALUE
---------- ------------ ------------
70,000 GMM Grammy
Public Co. Ltd. ................... $ 55,457 $ 20,469
481 Henley LP+ (b) ...................... 0 1,443
77,843 Liberty Global Inc., Cl. A+ ......... 968,833 3,050,667
75,000 Liberty Global Inc., Cl. C+ ......... 906,299 2,744,250
35,500 Liberty Media Corp. -
Capital, Cl. A+ ................... 798,937 4,135,395
1,000 Live Nation Inc.+ ................... 17,269 14,520
100,000 Shaw Brothers
(Hong Kong) Ltd. .................. 145,928 198,784
210,000 SMG plc ............................. 250,707 67,929
60,000 The Walt Disney Co. ................. 1,261,941 1,936,800
205,000 Time Warner Inc. .................... 3,284,146 3,384,550
75,000 Viacom Inc., Cl. A+ ................. 1,492,814 3,298,500
155,000 Vivendi ............................. 4,633,267 7,111,277
3,000 World Wrestling
Entertainment Inc., Cl. A ......... 33,305 44,280
------------ ------------
21,720,270 37,230,892
------------ ------------
HOTELS AND GAMING -- 11.5%
95,000 Boyd Gaming Corp. ................... 3,868,079 3,236,650
13,000 Churchill Downs Inc. ................ 409,690 701,610
144,500 Gaylord Entertainment Co.+ .......... 3,588,316 5,847,915
4,500 Greek Organization of Football
Prognostics SA .................... 48,690 180,403
5,000 Harrah's Entertainment Inc. ......... 195,157 443,750
3,000 Host Hotels & Resorts Inc. .......... 61,590 51,120
128,000 International Game
Technology ........................ 3,923,436 5,623,040
482,352 Ladbrokes plc ....................... 4,839,234 3,103,755
20,000 Las Vegas Sands Corp.+ .............. 1,090,425 2,061,000
27,000 Melco PBL Entertainment
(Macau) Ltd., ADR+ ................ 415,380 312,120
71,000 MGM Mirage+ ......................... 2,605,268 5,965,420
42,000 Pinnacle Entertainment Inc.+ ........ 879,416 989,520
6,000 Starwood Hotels & Resorts
Worldwide Inc. .................... 151,088 264,180
1,000 Wyndham Worldwide Corp. ............. 27,561 23,560
2,000 Wynn Resorts Ltd. ................... 151,772 224,260
------------ ------------
22,255,102 29,028,303
------------ ------------
PUBLISHING -- 7.7%
20,000 Arnoldo Mondadori
Editore SpA ....................... 63,828 164,335
90,000 Belo Corp., Cl. A ................... 1,408,094 1,569,600
16,666 Emap plc ............................ 207,960 305,214
5,000 Gannett Co. Inc. .................... 230,613 195,000
1,150 Idearc Inc. ......................... 36,639 20,194
100,000 Il Sole 24 Ore+ ..................... 842,861 832,639
144,400 Independent News &
Media plc ......................... 193,226 500,144
800 John Wiley & Sons Inc., Cl. B ....... 5,693 34,360
5,000 Journal Register Co. ................ 12,938 8,800
44,000 Lee Enterprises Inc. ................ 987,749 644,600
19,024 McClatchy Co., Cl. A ................ 529,430 238,180
8,800 Media General Inc., Cl. A ........... 329,846 187,000
22,000 Meredith Corp. ...................... 572,606 1,209,560
100,000 Nation Multimedia Group
Public Co. Ltd.+ (b) .............. 84,677 21,671
50,000 New Straits Times
Press Berhad ...................... 35,758 30,088
285,000 News Corp., Cl. A ................... 3,537,380 5,839,650
40,000 News Corp., Cl. B ................... 396,739 850,000
150,000 Oriental Press Group Ltd. ........... 46,315 26,162
See accompanying notes to financial statements.
3
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
SCHEDULE OF INVESTMENTS (CONTINUED)
DECEMBER 31, 2007
MARKET
SHARES COST VALUE
---------- ------------ ------------
COMMON STOCKS (CONTINUED)
COPYRIGHT/CREATIVITY COMPANIES (CONTINUED)
PUBLISHING (CONTINUED)
10,000 Playboy Enterprises Inc.,
Cl. A+ ............................ $ 97,125 $ 91,500
974,000 Post Publishing
Public Co. Ltd. (b) ............... 47,100 147,466
2,360 Sanoma WSOY Oyj ..................... 63,150 67,732
1,000 Scholastic Corp.+ ................... 16,500 34,890
251,520 SCMP Group Ltd. ..................... 181,457 87,739
252,671 Singapore Press Holdings Ltd. ....... 742,032 789,899
300 Spir Communication .................. 23,329 31,773
3,000 Sun-Times Media Group Inc.,
Cl. A+ ............................ 15,140 6,600
15,000 Telegraaf Media Groep NV ............ 285,271 548,270
64,000 The E.W. Scripps Co., Cl. A ......... 2,887,044 2,880,640
38,000 The McGraw-Hill
Companies Inc. .................... 1,217,995 1,664,780
11,091 United Business Media plc ........... 123,260 143,395
4,000 Wolters Kluwer NV ................... 90,625 131,468
------------ ------------
15,312,380 19,303,349
------------ ------------
TOTAL COPYRIGHT/CREATIVITY
COMPANIES ......................... 75,431,036 107,019,724
------------ ------------
DISTRIBUTION COMPANIES -- 53.3%
BROADCASTING -- 7.6%
1,560 Asahi Broadcasting Corp. ............ 62,911 251,214
6,000 CanWest Global
Communications Corp.+ ............. 52,330 60,000
12,000 CanWest Global
Communications Corp.,
Cl. A+ ............................ 104,661 86,935
18,000 CanWest Global
Communications Corp.,
Sub-Voting+ ....................... 92,011 131,314
70,000 CBS Corp., Cl. A .................... 820,936 1,872,500
6,400 Chubu-Nippon
Broadcasting Co. Ltd. ............. 46,375 62,387
6,527 Citadel Broadcasting Corp. .......... 19,079 13,446
50,000 Clear Channel
Communications Inc. ............... 1,904,622 1,726,000
20,000 Cogeco Inc. ......................... 388,830 800,446
1,833 Corus Entertainment Inc.,
Cl. B, New York ................... 7,463 89,982
6,500 Corus Entertainment Inc.,
Cl. B, Toronto .................... 26,464 318,233
9,000 Cox Radio Inc., Cl. A+ .............. 55,500 109,350
120,000 Discovery Holding Co., Cl. A+ ....... 1,472,927 3,016,800
166 Emmis Communications Corp.,
Cl. A+ ............................ 1,741 639
18,140 Fisher Communications Inc.+ ......... 866,765 688,594
28 Fuji Television Network Inc. ........ 61,010 46,368
98,000 Gray Television Inc. ................ 1,058,678 785,960
10,000 Gray Television Inc., Cl. A ......... 105,542 85,000
10,000 Grupo Radio Centro
SA de CV, ADR ..................... 46,871 127,000
30,000 Hearst-Argyle Television Inc. ....... 302,404 663,300
4,550 Lagardere SCA ....................... 100,163 341,198
34,000 Lin TV Corp., Cl. A+ ................ 495,214 413,780
5,140 Media Prima Berhad .................. 0 4,368
4,000 Metropole Television SA ............. 35,208 105,268
6,200 Nippon Television
Network Corp. ..................... 894,726 831,921
4,650 NRJ Group ........................... 22,694 48,814
MARKET
SHARES COST VALUE
---------- ------------ ------------
1,000 NTN Buzztime Inc.+ .................. $ 862 $ 600
500 Radio One Inc., Cl. A+ .............. 5,510 1,165
1,000 Radio One Inc., Cl. D+ .............. 11,428 2,370
1,500 RTL Group (Brussels) ................ 76,363 177,091
3,500 RTL Group (New York) ................ 113,838 413,315
1,906 SAGA Communications Inc.,
Cl. A+ ............................ 9,709 11,226
66,000 Salem Communications Corp.,
Cl. A ............................. 957,718 434,940
80,000 Sinclair Broadcast
Group Inc., Cl. A ................. 824,936 656,800
25,000 Societe Television Francaise 1 ...... 249,649 668,889
5,000 Spanish Broadcasting
System Inc., Cl. A+ ............... 43,950 9,250
50,000 Television Broadcasts Ltd. .......... 187,673 300,421
140,000 Tokyo Broadcasting
System Inc. ....................... 2,676,428 3,007,653
258 TV Asahi Corp. ...................... 434,628 408,772
240,000 TV Azteca SA de CV, CPO ............. 58,305 144,031
26,000 UTV Media plc ....................... 105,595 123,437
89,000 Young Broadcasting Inc.,
Cl. A+ ............................ 316,992 93,450
------------ ------------
15,118,709 19,134,227
------------ ------------
BUSINESS SERVICES -- 0.6%
15,000 BB Holdings Ltd.+ ................... 60,294 71,625
6,000 Carlisle Group Ltd.+ ................ 8,600 15,108
11,244 Cockleshell Ltd.+ ................... 0 14,325
1,000 Convergys Corp.+ .................... 17,738 16,460
100,000 Ideation Acquisition Corp.+ ......... 800,000 785,000
8,000 Interactive Data Corp. .............. 52,250 264,080
30,000 Interpublic Group of
Companies Inc.+ ................... 309,660 243,300
3,000 Moody's Corp. ....................... 72,575 107,100
1,500 Shellshock Ltd.+ .................... 851 1,896
500 The Dun & Bradstreet Corp. .......... 6,320 44,315
2,500 Traffix Inc. ........................ 12,500 15,300
------------ ------------
1,340,788 1,578,509
------------ ------------
CABLE -- 8.7%
16,578 Austar United
Communications Ltd.+ .............. 16,894 23,072
197,000 Cablevision Systems Corp.,
Cl. A+ ............................ 2,097,297 4,826,500
600,000 Charter Communications Inc.,
Cl. A+ ............................ 1,994,170 702,000
40,400 Cogeco Cable Inc. ................... 828,167 1,957,064
47,250 Comcast Corp., Cl. A+ ............... 908,931 862,785
10,500 Comcast Corp., Cl. A, Special+ ...... 53,073 190,260
15,000 Mediacom Communications
Corp., Cl. A+ ..................... 126,903 68,850
215,690 Rogers Communications Inc.,
Cl. B, New York ................... 1,045,983 9,759,972
19,310 Rogers Communications Inc.,
Cl. B, Toronto .................... 148,206 880,244
22,000 Shaw Communications Inc.,
Cl. B, New York ................... 103,451 520,960
78,000 Shaw Communications Inc.,
Cl. B, Toronto .................... 105,571 1,868,301
10,000 Time Warner Cable Inc., Cl. A+ ...... 388,900 276,000
------------ ------------
7,817,546 21,936,008
------------ ------------
CONSUMER SERVICES -- 3.6%
1,000 1-800-FLOWERS.COM Inc.,
Cl. A+ ............................ 9,790 8,730
75,000 Best Buy Co. Inc. ................... 3,819,190 3,948,750
See accompanying notes to financial statements.
4
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
SCHEDULE OF INVESTMENTS (CONTINUED)
DECEMBER 31, 2007
MARKET
SHARES COST VALUE
---------- ------------ ------------
COMMON STOCKS (CONTINUED)
DISTRIBUTION COMPANIES (CONTINUED)
CONSUMER SERVICES (CONTINUED)
4,000 Bowlin Travel Centers Inc.+ ......... $ 3,022 $ 7,400
20,000 H&R Block Inc. ...................... 258,838 371,400
90,000 IAC/InterActiveCorp+ ................ 2,330,242 2,422,800
110,000 Liberty Media Corp. -
Interactive, Cl. A+ ............... 706,497 2,098,800
2,000 Martha Stewart Living
Omnimedia Inc., Cl. A+ ............ 16,500 18,540
4,000 TiVo Inc.+ .......................... 27,942 33,360
------------ ------------
7,172,021 8,909,780
------------ ------------
DIVERSIFIED INDUSTRIAL -- 1.7%
28,500 Bouygues SA ......................... 745,134 2,375,104
18,432 Contax Participacoes SA, ADR ........ 7,572 23,962
50,000 General Electric Co. ................ 1,695,100 1,853,500
7,700 Hutchison Whampoa Ltd. .............. 71,267 87,345
7,908 Malaysian Resources Corp.
Berhad+ ........................... 35,568 6,098
------------ ------------
2,554,641 4,346,009
------------ ------------
ENERGY AND UTILITIES -- 0.2%
20,000 El Paso Electric Co.+ ............... 160,876 511,400
------------ ------------
ENTERTAINMENT -- 4.7%
3,150 British Sky Broadcasting
Group plc, ADR .................... 56,080 154,098
12,000 Canal+ Groupe ....................... 10,818 144,567
4,005 Chestnut Hill Ventures+ (b) ......... 241,092 112,741
475,000 Grupo Televisa SA, ADR .............. 7,174,739 11,290,750
12,000 Regal Entertainment Group,
Cl. A ............................. 165,788 216,840
5,800 Triple Crown Media Inc.+ ............ 29,340 27,434
------------ ------------
7,677,857 11,946,430
------------ ------------
EQUIPMENT -- 1.7%
11,000 American Tower Corp., Cl. A+ ........ 131,710 468,600
2,000 Amphenol Corp., Cl. A ............... 7,794 92,740
85,000 Corning Inc. ........................ 753,509 2,039,150
1,500 L-3 Communications
Holdings Inc. ..................... 16,500 158,910
50,000 Motorola Inc. ....................... 538,801 802,000
20,000 Nextwave Wireless Inc.+ ............. 165,230 107,600
2,000 Nortel Networks Corp.+ .............. 55,630 30,356
12,000 QUALCOMM Inc. ....................... 29,959 472,200
40,000 Sycamore Networks Inc.+ ............. 136,260 153,600
2,000 The Furukawa Electric Co. Ltd. ...... 7,419 7,770
------------ ------------
1,842,812 4,332,926
------------ ------------
FINANCIAL SERVICES -- 0.1%
3,000 Interactive Brokers Group Inc.,
Cl. A+ ............................ 68,739 96,960
------------ ------------
FOOD AND BEVERAGE -- 0.1%
5,282 Compass Group plc ................... 37,648 32,437
1,249 Pernod-Ricard SA .................... 175,325 288,707
------------ ------------
212,973 321,144
------------ ------------
RETAIL -- 0.0%
3,000 Macy's Inc. ......................... 115,511 77,610
------------ ------------
SATELLITE -- 1.7%
300 Asia Satellite
Telecommunications
Holdings Ltd., ADR ................ 5,693 5,580
SHARES/ MARKET
UNITS COST VALUE
---------- ------------ ------------
35,000 EchoStar Communications Corp.,
Cl. A+ ............................ $ 454,040 $ 1,320,200
1,000 Lockheed Martin Corp. ............... 27,862 105,260
6,000 PT Indosat Tbk, ADR ................. 58,079 279,840
30 SKY Perfect JSAT Corp.+ ............. 15,472 11,708
110,000 The DIRECTV Group Inc.+ ............. 2,392,855 2,543,200
------------ ------------
2,954,001 4,265,788
------------ ------------
TELECOMMUNICATIONS: LONG
DISTANCE -- 2.5%
15,000 AT&T Inc. ........................... 353,822 623,400
2,000 Embarq Corp. ........................ 61,748 99,060
35,000 Philippine Long Distance
Telephone Co., ADR ................ 597,989 2,650,200
62,500 Sprint Nextel Corp. ................. 940,096 820,625
1,000 Startec Global
Communications Corp.+ (b) ......... 4,645 2
600,000 Telecom Italia SpA .................. 1,660,799 1,864,117
10,000 Windstream Corp. .................... 31,139 130,200
------------ ------------
3,650,238 6,187,604
------------ ------------
TELECOMMUNICATIONS: NATIONAL -- 6.3%
9,000 BT Group plc, ADR ................... 375,870 485,280
5,000 China Telecom Corp. Ltd.,
ADR ............................... 126,250 390,350
5,000 China Unicom Ltd., ADR .............. 38,450 112,000
34,000 Compania de
Telecomunicaciones de
Chile SA, ADR ..................... 556,749 253,640
158,000 Deutsche Telekom AG, ADR ............ 2,198,641 3,423,860
49,000 Elisa Oyj ........................... 512,934 1,504,452
3,000 France Telecom SA, ADR .............. 48,120 106,890
3,305 Hellenic Telecommunications
Organization SA ................... 39,578 121,769
500 Magyar Telekom
Telecommunications plc,
ADR ............................... 9,650 13,465
50 Nippon Telegraph &
Telephone Corp. ................... 230,089 250,190
4,320 PT Telekomunikasi
Indonesia, ADR .................... 18,513 181,483
6,000 Rostelecom, ADR ..................... 41,408 417,300
45,000 Swisscom AG, ADR .................... 1,217,835 1,741,500
2,844 Telecom Corp. of
New Zealand Ltd., ADR ............. 24,405 47,239
54,000 Telefonica SA, ADR .................. 1,314,668 5,269,860
38,000 Telefonos de Mexico
SAB de CV, Cl. L, ADR ............. 177,884 1,399,920
18,172 TeliaSonera AB ...................... 51,070 170,102
2,400 Telstra Corp. Ltd., ADR ............. 30,324 49,416
100 Virgin Media Inc. ................... 2,344 1,714
------------ ------------
7,014,782 15,940,430
------------ ------------
TELECOMMUNICATIONS: REGIONAL -- 7.4%
50,000 BCE Inc. ............................ 1,400,531 1,987,000
4,266 Bell Aliant Regional
Communications
Income Fund ....................... 67,481 127,209
2,537 Bell Aliant Regional
Communications
Income Fund (a)(b) ................ 40,134 74,664
4,000 Brasil Telecom
Participacoes SA, ADR ............. 231,475 298,320
14,000 CenturyTel Inc. ..................... 430,780 580,440
80,000 Cincinnati Bell Inc.+ ............... 514,610 380,000
50,000 Citizens Communications Co. ......... 706,774 636,500
See accompanying notes to financial statements.
5
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
SCHEDULE OF INVESTMENTS (CONTINUED)
DECEMBER 31, 2007
MARKET
SHARES COST VALUE
---------- ------------ ------------
COMMON STOCKS (CONTINUED)
DISTRIBUTION COMPANIES (CONTINUED)
TELECOMMUNICATIONS: REGIONAL (CONTINUED)
190,000 Qwest Communications
International Inc.+ ............... $ 807,198 $ 1,331,900
18,432 Tele Norte Leste
Participacoes SA, ADR ............... 244,808 355,369
10,000 Telecom Argentina SA, ADR+ .......... 26,440 222,500
65,000 Telephone & Data Systems Inc. ....... 2,452,490 4,069,000
50,000 Telephone & Data Systems Inc.,
Special ........................... 1,950,017 2,880,000
40,000 TELUS Corp. ......................... 722,455 2,003,749
20,000 Time Warner Telecom Inc.,
Cl. A+ ............................ 341,155 405,800
73,660 Verizon Communications Inc. ......... 2,470,401 3,218,205
------------ ------------
12,406,749 18,570,656
------------ ------------
WIRELESS COMMUNICATIONS -- 6.4%
91,000 America Movil SAB de CV,
Cl. L, ADR ........................ 508,132 5,586,490
5,000 Clearwire Corp., Cl. A+ ............. 73,755 68,550
2,513 Grupo Iusacell SA de CV+ ............ 9,492 33,381
102 Hutchison Telecommunications
International Ltd. ................ 79 153
240,000 Jasmine International
Public Co. Ltd. (b) ............... 5,040 2,850
1,200 NTT DoCoMo Inc. ..................... 1,845,771 1,997,941
30,000 Price Communications Corp.,
Escrow+ ........................... 0 0
10,800 Rural Cellular Corp., Cl. A+ ........ 22,788 476,172
37,000 SK Telecom Co. Ltd., ADR ............ 828,800 1,104,080
330 Tele Norte Celular
Participacoes SA, ADR+ ............ 5,098 4,785
825 Telemig Celular
Participacoes SA, ADR ............. 23,843 46,324
3,178 Tim Participacoes SA, ADR ........... 38,554 111,071
30,000 United States Cellular Corp.+ ....... 1,127,335 2,523,000
89,000 Vimpel-Communications,
ADR ............................... 118,168 3,702,400
9,401 Vivo Participacoes SA, ADR .......... 22,019 51,424
8,750 Vodafone Group plc, ADR ............. 168,145 326,550
200 Xanadoo Co.+ ........................ 143,565 71,800
------------ ------------
4,940,584 16,106,971
------------ ------------
TOTAL DISTRIBUTION
COMPANIES ......................... 75,048,827 134,262,452
------------ ------------
TOTAL COMMON STOCKS ................. 150,479,863 241,282,176
------------ ------------
PREFERRED STOCKS -- 0.0%
BUSINESS SERVICES -- 0.0%
2,159 Interep National Radio Sales Inc.,
4.000% Cv. Pfd.,
Ser. A+ (a)(b)(c) ................. 192,575 4,317
------------ ------------
RIGHTS -- 0.0%
BROADCASTING -- 0.0%
5,140 Media Prima Berhad,
expire 07/18/08+ .................. 1,352 2,596
------------ ------------
MARKET
SHARES COST VALUE
---------- ------------ ------------
WARRANTS -- 0.0%
BROADCASTING -- 0.0%
2,250 Granite Broadcasting Corp.,
Ser. A, expire 06/04/12+ .......... $ 0 $ 2,250
254 Granite Broadcasting Corp.,
Ser. B, expire 06/04/12+ .......... 0 254
5,140 Media Prima Berhad,
expire 07/31/08+ .................. 135 2,176
------------ ------------
TOTAL WARRANTS ...................... 135 4,680
------------ ------------
PRINCIPAL
AMOUNT
----------
CONVERTIBLE CORPORATE BONDS -- 0.0%
BUSINESS SERVICES -- 0.0%
$ 50,000 BBN Corp., Sub. Deb. Cv.,
6.000%, 04/01/12+ (b) ............. 49,478 0
------------ ------------
U.S. GOVERNMENT OBLIGATIONS -- 4.2%
10,522,000 U.S. Treasury Bills,
2.487% to 3.188%++,
01/03/08 to 03/27/08 .............. 10,463,536 10,459,713
------------ ------------
TOTAL INVESTMENTS -- 100.0% ...................... $161,186,939 251,753,482
============
OTHER ASSETS AND LIABILITIES (NET) .............................. (419,712)
PREFERRED STOCK
(994,100 preferred shares outstanding) ....................... (49,827,500)
------------
NET ASSETS -- COMMON STOCK
(14,001,353 common shares outstanding) ....................... $201,506,270
============
NET ASSET VALUE PER COMMON SHARE
($201,506,270 / 14,001,353 shares outstanding) ............... $ 14.39
============
----------
(a) Security exempt from registration under Rule 144A of the Securities Act of
1933, as amended. These securities may be resold in transactions exempt
from registration, normally to qualified institutional buyers. At December
31, 2007, the market value of Rule 144A securities amounted to $3,125,148
or 1.24% of total investments.
(b) Security fair valued under procedures established by the Board of
Directors. The procedures may include reviewing available financial
information about the company and reviewing valuation of comparable
securities and other factors on a regular basis. At December 31, 2007, the
market value of fair valued securities amounted to $365,164 or 0.15% of
total investments.
(c) Illiquid security.
+ Non-income producing security.
++ Represents annualized yield at date of purchase.
ADR American Depository Receipt
CPO Ordinary Participation Certificate
GDR Global Depository Receipt
% OF
MARKET MARKET
VALUE VALUE
-------- -------------
GEOGRAPHIC DIVERSIFICATION
North America ....................................... 65.7% $ 165,329,531
Europe .............................................. 15.1 38,080,036
Latin America ....................................... 8.0 20,113,624
Japan ............................................... 7.4 18,700,472
Asia/Pacifc ......................................... 3.8 9,529,819
-------- -------------
100.0% $ 251,753,482
======== =============
See accompanying notes to financial statements.
6
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
STATEMENT OF ASSETS AND LIABILITIES
DECEMBER 31, 2007
ASSETS:
Investments, at value (cost $161,186,939) .................. $ 251,753,482
Foreign currency, at value (cost $37,677) .................. 37,858
Cash ....................................................... 12,654
Receivable for investments sold ............................ 232,820
Dividends and interest receivable .......................... 254,833
Unrealized appreciation on swap contracts .................. 15,874
Prepaid expense ............................................ 8,157
-------------
TOTAL ASSETS ............................................... 252,315,678
-------------
LIABILITIES:
Distributions payable ...................................... 48,786
Payable for investment advisory fees ....................... 672,609
Payable for payroll expenses ............................... 64,341
Payable for accounting fees ................................ 11,233
Payable for shareholder communications expenses ............ 99,551
Payable for legal and audit fees ........................... 54,768
Other accrued expenses ..................................... 30,620
-------------
TOTAL LIABILITIES .......................................... 981,908
-------------
PREFERRED STOCK:
Series B Cumulative Preferred Stock (6.00%, $25
liquidation value, $0.001 par value, 1,000,000 shares
authorized with 993,100 shares issued
and outstanding) ......................................... 24,827,500
Series C Cumulative Preferred Stock (Auction Rate,
$25,000 liquidation value, $0.001 par value, 1,000
shares authorized with 1,000 shares issued
and outstanding) ......................................... 25,000,000
-------------
TOTAL PREFERRED STOCK ...................................... 49,827,500
-------------
NET ASSETS ATTRIBUTABLE TO COMMON
STOCK SHAREHOLDERS ....................................... $ 201,506,270
=============
NET ASSETS ATTRIBUTABLE TO COMMON STOCK
SHAREHOLDERS CONSIST OF:
Paid-in capital, at $0.001 par value ....................... $ 115,936,174
Accumulated distributions in excess of net
investment income ........................................ (16,457)
Accumulated distributions in excess of net
realized gain on investments, swap contracts,
and foreign currency transactions ........................ (4,999,380)
Net unrealized appreciation on investments ................. 90,566,543
Net unrealized appreciation on swap contracts .............. 15,874
Net unrealized appreciation on foreign
currency translations .................................... 3,516
-------------
NET ASSETS ................................................. $ 201,506,270
=============
NET ASSET VALUE PER COMMON SHARE
($201,506,270 / 14,001,353 shares outstanding;
196,750,000 shares authorized) ............................. $ 14.39
=============
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2007
INVESTMENT INCOME:
Dividends (net of foreign taxes of $244,816) ............... $ 4,204,639
Interest ................................................... 233,159
-------------
TOTAL INVESTMENT INCOME .................................... 4,437,798
-------------
EXPENSES:
Investment advisory fees ................................... 2,626,472
Shareholder communications expenses ........................ 223,213
Payroll expenses ........................................... 161,066
Shareholder services fees .................................. 86,099
Legal and audit fees ....................................... 81,270
Custodian fees ............................................. 73,837
Directors' fees ............................................ 66,448
Auction agent fees ......................................... 55,200
Accounting fees ............................................ 45,000
Interest expense ........................................... 716
Miscellaneous expenses ..................................... 42,013
-------------
TOTAL EXPENSES ............................................. 3,461,334
Less: Custodian fee credits ................................ (3,820)
-------------
NET EXPENSES ............................................... 3,457,514
-------------
NET INVESTMENT INCOME ...................................... 980,284
-------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS,
SWAP CONTRACTS, AND FOREIGN CURRENCY:
Net realized gain on investments ........................... 12,377,744
Net realized gain on swap contracts ........................ 398,111
Net realized loss on foreign currency transactions ......... (15,130)
-------------
Net realized gain on investments, swap contracts, and
foreign currency transactions ............................ 12,760,725
-------------
Net change in unrealized appreciation/depreciation
on investments ........................................... 4,460,053
Net change in unrealized appreciation/depreciation
on swap contracts ........................................ (728,361)
Net change in unrealized appreciation/depreciation
on foreign currency translations ......................... 2,399
-------------
Net change in unrealized appreciation/depreciation
on investments, swap contracts, and
foreign currency translations ............................ 3,734,091
-------------
NET REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENTS, SWAP CONTRACTS, AND
FOREIGN CURRENCY ......................................... 16,494,816
-------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ....... 17,475,100
-------------
Total Distributions to Preferred Stock Shareholders ........ (2,817,633)
-------------
NET INCREASE IN NET ASSETS ATTRIBUTABLE TO
COMMON STOCK SHAREHOLDERS
RESULTING FROM OPERATIONS ................................ $ 14,657,467
=============
See accompanying notes to financial statements.
7
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
STATEMENT OF CHANGES IN NET ASSETS ATTRIBUTABLE TO COMMON SHAREHOLDERS
YEAR ENDED YEAR ENDED
DECEMBER 31, 2007 DECEMBER 31, 2006
------------------ -----------------
OPERATIONS:
Net investment income ....................................................... $ 980,284 $ 3,773,102
Net realized gain on investments, swap contracts, and foreign currency
transactions .............................................................. 12,760,725 7,395,666
Net change in unrealized appreciation/depreciation on investments, swap
contracts, and foreign currency translations .............................. 3,734,091 33,012,709
------------------ -----------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS ........................ 17,475,100 44,181,477
------------------ -----------------
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS:
Net investment income ....................................................... (292,363) (994,550)
Net realized short-term gain on investments, swap contracts, and foreign
currency transactions ..................................................... (992,507) (52,708)
Net realized long-term gain on investments, swap contracts, and foreign
currency transactions ..................................................... (1,532,763) (1,667,274)
------------------ -----------------
TOTAL DISTRIBUTIONS TO PREFERRED SHAREHOLDERS ............................... (2,817,633) (2,714,532)
------------------ -----------------
NET INCREASE IN NET ASSETS ATTRIBUTABLE TO COMMON SHAREHOLDERS RESULTING
FROM OPERATIONS ........................................................... 14,657,467 41,466,945
------------------ -----------------
DISTRIBUTIONS TO COMMON SHAREHOLDERS:
Net investment income ....................................................... (1,091,095) (3,235,705)
Net realized short-term gain on investments, swap contracts, and foreign
currency transactions ..................................................... (3,681,967) (171,483)
Net realized long-term gain on investments, swap contracts, and foreign
currency transactions ..................................................... (5,714,592) (5,424,374)
Return of capital ........................................................... (17,111) --
------------------ -----------------
TOTAL DISTRIBUTIONS TO COMMON SHAREHOLDERS .................................. (10,504,765) (8,831,562)
------------------ -----------------
FUND SHARE TRANSACTIONS:
Net decrease from repurchase of common shares ............................... (230,817) (130,462)
------------------ -----------------
NET DECREASE IN NET ASSETS FROM FUND SHARE TRANSACTIONS ..................... (230,817) (130,462)
------------------ -----------------
NET INCREASE IN NET ASSETS ATTRIBUTABLE TO COMMON SHAREHOLDERS .............. 3,921,885 32,504,921
NET ASSETS ATTRIBUTABLE TO COMMON SHAREHOLDERS:
Beginning of period ......................................................... 197,584,385 165,079,464
------------------ -----------------
End of period (including undistributed net investment income of
$0 and $0, respectively) .................................................. $ 201,506,270 $ 197,584,385
================== =================
See accompanying notes to financial statements.
8
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION. The Gabelli Global Multimedia Trust Inc. (the "Fund") is a
non-diversified closed-end management investment company organized as a Maryland
corporation on March 31, 1994 and registered under the Investment Company Act of
1940, as amended (the "1940 Act"). The Fund commenced investment operations on
November 15, 1994. The Fund's primary objective is long-term growth of capital
with income as a secondary objective.
The Fund will invest at least 80% of its assets, under normal market
conditions, in common stock and other securities, including convertible
securities, preferred stock, options, and warrants of companies in the
telecommunications, media, publishing, and entertainment industries (the "80%
Policy"). The 80% Policy may be changed without shareholder approval. The Fund
will provide shareholders with notice at least 60 days prior to the
implementation of any change in the 80% Policy.
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.
In September 2006, the Financial Accounting Standards Board (the "FASB")
issued Statement of Financial Accounting Standards ("SFAS") 157, Fair Value
Measurements, which clarifies the definition of fair value and requires
companies to expand their disclosure about the use of fair value to measure
assets and liabilities in interim and annual periods subsequent to initial
recognition. Adoption of SFAS 157 requires the use of the price that would be
received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date. SFAS 157 is
effective for financial statements issued for fiscal years beginning after
November 15, 2007, and interim periods within those fiscal years. At this time,
management is in the process of reviewing the requirements of SFAS 157 against
its current valuation policies to determine future applicability.
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 December
31, 2007, there were no open repurchase agreements.
9
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
SWAP AGREEMENTS. The Fund may enter into interest rate swap or cap
transactions. The use of swaps and caps is a highly specialized activity that
involves investment techniques and risks different from those associated with
ordinary portfolio transactions. Swap agreements may involve, to varying
degrees, elements of market and counterparty risk, and exposure to loss in
excess of the related amounts reflected in the Statement of Assets and
Liabilities. In an interest rate swap, the Fund would agree to pay to the other
party to the interest rate swap (which is known as the "counterparty")
periodically a fixed rate payment in exchange for the counterparty agreeing to
pay to the Fund periodically a variable rate payment that is intended to
approximate the Fund's variable rate payment obligation on Series C Preferred
Stock. In an interest rate cap, the Fund would pay a premium to the counterparty
and, to the extent that a specified variable rate index exceeds a predetermined
fixed rate, would receive from that counterparty payments of the difference
based on the notional amount of such cap. Interest rate swap and cap
transactions introduce additional risk because the Fund would remain obligated
to pay preferred stock dividends when due in accordance with the Articles
Supplementary even if the counterparty defaulted. If there is a default by the
counterparty to a swap contract, the Fund will be limited to contractual
remedies pursuant to the agreements related to the transaction. There is no
assurance that the swap contract counterparties will be able to meet their
obligations pursuant to a swap contract 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 a swap contract. The creditworthiness of the swap contract
counterparties is closely monitored in order to minimize this risk. Depending on
the general state of short-term interest rates and the returns on 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 an
interest rate swap or cap 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.
Unrealized gains related to swaps are reported as an asset and unrealized
losses are reported as a liability 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 gains or
losses in the Statement of Operations. A realized gain or loss is recorded upon
payment or receipt of a periodic payment or termination of swap agreements.
The Fund has entered into two interest rate swap agreements with Citibank
N.A. Under the agreements, the Fund receives a floating rate of interest and
pays a respective fixed rate of interest on the nominal value of the swap.
Details of the swaps at December 31, 2007 are as follows:
NET UNREALIZED
NOTIONAL FLOATING RATE* TERMINATION APPRECIATION/
AMOUNT FIXED RATE (RATE RESET MONTHLY) DATE (DEPRECIATION)
----------- ---------- -------------------- ----------- --------------
$10,000,000 4.32% 4.57% 04/04/13 $(63,031)
15,000,000 3.27 4.57 04/04/08 78,905
--------
$ 15,874
========
----------
* Based on one month Libor (London Interbank Offered Rate).
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 December 31, 2007, 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
10
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
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 December 31, 2007, 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.
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.
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.
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 of 2.00% above the federal funds
rate on outstanding balances. This amount, if any, would be shown as "interest
expense" in the Statement of Operations.
DISTRIBUTIONS TO SHAREHOLDERS. Distributions to common 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. For the year ended
December 31, 2007, reclassifications were made to decrease accumulated
distributions in excess of net investment income by $437,381 and to increase
accumulated distributions in excess of net realized gain on investments, swap
contracts, and foreign currency transactions by $437,381.
Distributions to shareholders of the Fund's 6.00% Series B Cumulative
Preferred Stock and Series C Auction Rate Cumulative Preferred Stock
("Cumulative Preferred Stock") are recorded on a daily basis and are determined
as described in Note 5.
11
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
The tax character of distributions paid during the years ended December
31, 2007 and December 31, 2006 was as follows:
YEAR ENDED YEAR ENDED
DECEMBER 31, 2007 DECEMBER 31, 2006
-------------------------- -------------------------
COMMON PREFERRED COMMON PREFERRED
------------ ----------- ----------- -----------
DISTRIBUTIONS PAID FROM:
Ordinary income
(inclusive of short-term capital gains) ..... $ 4,842,031 $ 1,300,869 $ 3,407,188 $ 1,047,258
Net long-term capital gains .................... 5,645,623 1,516,764 5,424,374 1,667,274
Return of capital .............................. 17,111 -- -- --
------------ ----------- ----------- -----------
Total distributions paid ....................... $ 10,504,765 $ 2,817,633 $ 8,831,562 $ 2,714,532
============ =========== =========== ===========
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.
At December 31, 2007, the difference between book basis and tax basis
unrealized appreciation was primarily due to deferral of losses from wash sales
and basis adjustments based on prior year tax elections.
As of December 31, 2007, the components of accumulated earnings (losses)
on a tax basis were as follows:
Net unrealized appreciation on investments ................... $ 88,708,126
Net unrealized appreciation on foreign currency
and swap contracts ........................................ 19,390
Other temporary differences* ................................. (3,157,420)
------------
Total ........................................................ $ 85,570,096
============
----------
* Other temporary differences is primarily due to qualified five year tax
gain adjustments.
The following summarizes the tax cost of investments, swap contracts, and
the related unrealized appreciation (depreciation) at December 31, 2007:
GROSS GROSS
UNREALIZED UNREALIZED NET UNREALIZED
COST APPRECIATION DEPRECIATION APPRECIATION
------------- ------------ ------------ --------------
Investments ...... $ 163,045,356 $ 99,814,113 $(11,105,987) $ 88,708,126
Swap contracts ... 78,905 (63,031) 15,874
------------ ------------ --------------
$ 99,893,018 $(11,169,018) $ 88,724,000
============ ============ ==============
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. The
Fund has adopted the Interpretation for all open tax years and it had no impact
on the amounts reported in the financial statements.
3. AGREEMENTS AND TRANSACTIONS WITH AFFILIATES. The Fund has entered into an
investment advisory agreement (the "Advisory Agreement") with the Adviser which
provides that the Fund will pay the Adviser a fee, computed weekly and paid
monthly, equal on an annual basis to 1.00% of the value of the Fund's average
weekly net assets including the liquidation value of preferred stock. In
accordance with the Advisory Agreement, the Adviser provides a continuous
investment program for the Fund's portfolio and oversees the administration of
all aspects of the Fund's business and affairs. The Adviser has agreed to reduce
the management fee on the incremental assets attributable to the Cumulative
Preferred Stock if the total return of the NAV of the common shares of the Fund,
including distributions and advisory fee subject to reduction, does not exceed
the stated dividend rate or corresponding swap rate of each particular series of
the Cumulative Preferred Stock for the fiscal year.
The Fund's total return on the NAV of the common shares is monitored on a
monthly basis to assess whether the total return on the NAV of the common shares
exceeds the stated dividend rate or corresponding swap rate of each particular
series of Cumulative Preferred Stock for the period. For the year ended December
31, 2007, the Fund's total return on the NAV of the common shares exceeded the
stated dividend rate or net swap expense of all outstanding Preferred Stock.
Thus, management fees were accrued on these assets.
During the year ended December 31, 2007, the Fund paid brokerage
commissions on security trades of $41,870 to Gabelli & Company, Inc. ("Gabelli &
Company"), an affiliate of the Adviser.
12
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
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. During the
year ended December 31, 2007, the Fund paid or accrued $45,000 to the Adviser in
connection with the cost of computing the Fund's NAV.
As per the approval of the Board, the Fund compensates officers of the
Fund, who are employed by the Fund and are not employed by the Adviser (although
officers may receive incentive based variable compensation from affiliates of
the Adviser) and pays its allocated portion of the cost of the Fund's Chief
Compliance Officer. For the year ended December, 2007 the Fund paid or accrued
$161,066, which is included in payroll expenses in the Statement of Operations.
The Fund pays each Director who is not considered to be an affiliated
person an annual retainer of $6,000 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. In
addition, the Audit Committee Chairman receives an annual fee of $3,000 and the
Nominating Committee Chairman receives an annual fee of $2,000. Directors who
are directors or employees of the Adviser or an affiliated company receive no
compensation or expense reimbursement from the Fund.
4. PORTFOLIO SECURITIES. Purchases and proceeds from the sales of securities for
the fiscal year ended December 31, 2007, other than short-term and U.S.
Government securities, aggregated $37,919,914 and $37,220,343, respectively.
5. CAPITAL. The charter permits the Fund to issue 196,750,000 shares of common
stock (par value $0.001). The Board has authorized the repurchase of up to
1,700,000 shares on the open market when the shares are trading at a discount of
10% or more (or such other percentage as the Board may determine from time to
time) from the NAV of the shares. During the year ended December 31, 2007, the
Fund repurchased 17,000 shares of its common stock in the open market at a cost
of $230,817 and an average discount of approximately 12.14% from its NAV. All
shares of common stock repurchased have been retired.
Transactions in common stock were as follows:
YEAR ENDED YEAR ENDED
DECEMBER 31, 2007 DECEMBER 31, 2006
-------------------- --------------------
SHARES AMOUNT SHARES AMOUNT
------- ---------- ------- ----------
Net decrease from repurchase
of common shares ............. (17,000) $ (230,817) (12,400) $ (130,462)
The Fund's Articles of Incorporation authorize the issuance of up to
2,000,000 shares of $0.001 par value Cumulative Preferred Stock. The Cumulative
Preferred Stock is senior to the common stock and results in the financial
leveraging of the common stock. Such leveraging tends to magnify both the risks
and opportunities to common shareholders. Dividends on shares of the Cumulative
Preferred Stock are cumulative. The Fund is required by the 1940 Act and by the
Articles Supplementary to meet certain asset coverage tests with respect to the
Cumulative Preferred Stock. If the Fund fails to meet these requirements and
does not correct such failure, the Fund may be required to redeem, in part or in
full, the 6.00% Series B and Series C Auction Rate Cumulative Preferred Stock at
redemption prices of $25.00 and $25,000, respectively, per share plus an amount
equal to the accumulated and unpaid dividends whether or not declared on such
shares in order to meet these requirements. Additionally, failure to meet the
foregoing asset coverage requirements could restrict the Fund's ability to pay
dividends to common shareholders and could lead to sales of portfolio securities
at inopportune times. The income received on the Fund's assets may vary in a
manner unrelated to the fixed and variable rates, which could have either a
beneficial or detrimental impact on net investment income and gains available to
common shareholders.
On March 31, 2003, the Fund received net proceeds of $24,009,966 (after
underwriting discounts of $787,500 and offering expenses of $202,534) from the
public offering of 1,000,000 shares of 6.00% Series B Cumulative Preferred
Stock. Commencing April 2, 2008 and thereafter, the Fund, at its option, may
redeem the 6.00% Series B Cumulative Preferred Stock in whole or in part at the
redemption price at any time. The Board has authorized the repurchase of 6.00%
Series B Cumulative Preferred Stock in the open market at prices less than the
$25 liquidation value per share. During the year ended December 31, 2007, the
Fund did not repurchase any shares of 6.00% Series B Cumulative Preferred Stock.
At December 31, 2007, 993,100 shares of 6.00% Series B Cumulative Preferred
Stock were outstanding and accrued dividends amounted to $24,828.
On March 31, 2003, the Fund received net proceeds of $24,547,465 (after
underwriting discounts of $250,000 and offering expenses of $202,535) from the
public offering of 1,000 shares of Series C Auction Rate Cumulative Preferred
Stock. The dividend rate, as set by the auction process, which is generally held
every seven days, is expected to vary with short-term interest rates. If the
number of Series C Auction Rate Cumulative Preferred Stock subject to bid orders
by potential holders is less than the number of Series C Auction Rate Cumulative
Preferred Stock subject to sell orders, then the auction is considered to be a
failed auction, and the dividend rate will be the maximum rate. In that event,
holders that have submitted sell orders may not be able to sell any or all of
the Series C Auction Rate Cumulative Preferred Stock for which they have
submitted sell orders. The current maximum rate is
13
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
150% of the "AA" Financial Composite Commercial Paper Rate on the date of such
auction. The dividend rates of Series C Auction Rate Cumulative Preferred Stock
ranged from 4.70% to 6.10% for the year ended December 31, 2007. Existing
shareholders may submit an order to hold, bid, or sell such shares on each
auction date. Series C Auction Rate Cumulative Preferred Stock shareholders may
also trade shares in the secondary market. The Fund, at its option, may redeem
the Series C Auction Rate Cumulative Preferred Stock in whole or in part at the
redemption price at any time. During the fiscal year ended December 31, 2007,
the Fund did not redeem any shares of Series C Auction Rate Cumulative Preferred
Stock. At December 31, 2007, 1,000 shares of Series C Auction Rate Cumulative
Preferred Stock were outstanding with an annualized dividend rate of 5.750% per
share and accrued dividends amounted to $23,958.
The holders of Cumulative Preferred Stock generally are entitled to one
vote per share held on each matter submitted to a vote of shareholders of the
Fund and will vote together with holders of common stock as a single class. The
holders of Cumulative Preferred Stock voting together as a single class also
have the right currently to elect two Directors and under certain circumstances
are entitled to elect a majority of the Board of Directors. In addition, the
affirmative vote of a majority of the votes entitled to be cast by holders of
all outstanding shares of the preferred stock, voting as a single class, will be
required to approve any plan of reorganization adversely affecting the preferred
stock, and the approval of two-thirds of each class, voting separately, of the
Fund's outstanding voting stock must approve the conversion of the Fund from a
closed-end to an open-end investment company. The approval of a majority (as
defined in the 1940 Act) of the outstanding preferred stock and a majority (as
defined in the 1940 Act) of the Fund's outstanding voting securities are
required to approve certain other actions, including changes in the Fund's
investment objectives or fundamental investment policies.
6. INDUSTRY CONCENTRATION. Because the Fund primarily invests in common stocks
and other securities of foreign and domestic companies in the
telecommunications, media, publishing, and entertainment industries, its
portfolio may be subject to greater risk and market fluctuations than a
portfolio of securities representing a broad range of investments.
7. 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.
8. OTHER MATTERS. The Adviser and/or affiliates received subpoenas from the
Attorney General of the State of New York and the SEC requesting information on
mutual fund share trading practices involving certain funds managed by the
Adviser. GAMCO Investors, Inc. ("GAMCO"), the Adviser's parent company,
responded to these requests for documents and testimony. In June 2006, GAMCO
began discussions with the SEC regarding a possible resolution of their inquiry.
In February 2007, the Adviser made an offer of settlement to the staff of the
SEC for communication to the Commission for its consideration to resolve this
matter. This offer of settlement is subject to agreement regarding the specific
language of the SEC's administrative order and other settlement documents. On a
separate matter, in September 2005, the Adviser was informed by the staff of the
SEC that the staff may recommend to the Commission that an administrative remedy
and a monetary penalty be sought from the Adviser in connection with the actions
of two of nine closed-end funds managed by the Adviser relating to Section 19(a)
and Rule 19a-1 of the 1940 Act. These provisions require registered investment
companies to provide written statements to shareholders when a dividend is made
from a source other than net investment income. While the two closed-end funds
sent annual statements and provided other materials containing this information,
the funds did not send written statements to shareholders with each distribution
in 2002 and 2003. The Adviser believes that all of the funds are now in
compliance. The Adviser believes that these matters would have no effect on the
Fund or any material adverse effect on the Adviser or its ability to manage the
Fund. The staff's notice to the Adviser did not relate to the Fund.
14
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
FINANCIAL HIGHLIGHTS
SELECTED DATA FOR A COMMON SHARE
OUTSTANDING THROUGHOUT EACH PERIOD: YEAR ENDED DECEMBER 31,
--------------------------------------------------------------------
2007 2006 2005 2004 2003
------------ ----------- ------------ ----------- ---------
OPERATING PERFORMANCE:
Net asset value, beginning of period .................... $ 14.09 $ 11.77 $ 12.27 $ 10.56 $ 7.67
--------- --------- --------- --------- ---------
Net investment income (loss) ............................ 0.10 0.29 0.16 0.04 (0.03)
Net realized and unrealized gain on investments, swap
contracts and foreign currency transactions .......... 1.15 2.85 0.09 1.79 3.14
--------- --------- --------- --------- ---------
Total from investment operations ........................ 1.25 3.14 0.25 1.83 3.11
--------- --------- --------- --------- ---------
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS:(a)
Net investment income ................................... (0.02) (0.07) (0.03) (0.04) --
Net realized gain on investments, swap contracts and
foreign currency transactions ........................ (0.18) (0.12) (0.13) (0.09) (0.13)
--------- --------- --------- --------- ---------
Total distributions to preferred shareholders ........... (0.20) (0.19) (0.16) (0.13) (0.13)
--------- --------- --------- --------- ---------
NET INCREASE IN NET ASSETS ATTRIBUTABLE TO
COMMON SHAREHOLDERS RESULTING FROM OPERATIONS ........ 1.05 2.95 0.09 1.70 2.98
--------- --------- --------- --------- ---------
DISTRIBUTIONS TO COMMON SHAREHOLDERS:
Net investment income ................................... (0.08) (0.23) (0.12) -- --
Net realized gain on investments, swap contracts and
foreign currency transactions ........................ (0.67) (0.40) (0.48) -- --
Return of capital ....................................... (0.00)(d) -- -- -- --
--------- --------- --------- --------- ---------
Total distributions to common shareholders .............. (0.75) (0.63) (0.60) -- --
--------- --------- --------- --------- ---------
FUND SHARE TRANSACTIONS:
Increase in net asset value from repurchase of common
shares ............................................... 0.00(d) 0.00(d) 0.01 0.01 0.01
Increase in net asset value from repurchase of preferred
shares ............................................... -- -- -- 0.00(d) --
Offering expenses charged to paid-in capital ............ -- -- (0.00)(d) -- (0.10)
--------- --------- --------- --------- ---------
Total fund share transactions ........................... 0.00(d) 0.00(d) 0.01 0.01 (0.09)
--------- --------- --------- --------- ---------
NET ASSET VALUE ATTRIBUTABLE TO COMMON SHAREHOLDERS,
END OF PERIOD ........................................ $ 14.39 $ 14.09 $ 11.77 $ 12.27 $ 10.56
========= ========= ========= ========= =========
NAV total return + ...................................... 8.03% 26.65% 1.6% 16.2% 37.7%
========= ========= ========= ========= =========
Market value, end of period ............................. $ 12.89 $ 12.27 $ 10.15 $ 10.68 $ 9.07
========= ========= ========= ========= =========
Investment total return ++ .............................. 11.13% 27.89% 0.7% 17.8% 41.7%
========= ========= ========= ========= =========
RATIOS AND SUPPLEMENTAL DATA:
Net assets including liquidation value of preferred
shares, end of period (in 000's) ..................... $ 251,334 $ 247,412 $ 214,907 $ 223,739 $ 200,195
Net assets attributable to common shares, end of period
(in 000's) ........................................... $ 201,506 $ 197,584 $ 165,079 $ 173,912 $ 150,195
Ratio of net investment income (loss) to average net
assets attributable to common shares before preferred
share distributions .................................. 0.46% 2.17% 1.44% 0.71% (0.36)%
Ratio of operating expenses to average net assets
attributable to common shares net of advisory fee
reduction, if any .................................... 1.62%(e) 1.79%(e) 1.55%(e) 1.87% 1.81%
Ratio of operating expenses to average net assets
including liquidation value of preferred shares net of
advisory fee reduction, if any ....................... 1.32%(e) 1.39%(e) 1.20%(e) 1.41% 1.35%
Portfolio turnover rate ................................. 14.5% 9.8% 12.4% 7.5% 10.9%
See accompanying notes to financial statements.
15
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
FINANCIAL HIGHLIGHTS (CONTINUED)
SELECTED DATA FOR A COMMON SHARE
OUTSTANDING THROUGHOUT EACH PERIOD: YEAR ENDED DECEMBER 31,
---------------------------------------------------------
2007 2006 2005 2004 2003
--------- --------- --------- --------- ---------
PREFERRED STOCK:
6.00% SERIES B CUMULATIVE PREFERRED STOCK
Liquidation value, end of period (in 000's) ......... $ 24,828 $ 24,828 $ 24,828 $ 24,828 $ 25,000
Total shares outstanding (in 000's) ................. 993 993 993 993 1,000
Liquidation preference per share .................... $ 25.00 $ 25.00 $ 25.00 $ 25.00 $ 25.00
Average market value (b) ............................ $ 24.14 $ 24.12 $ 25.00 $ 24.84 $ 25.28
Asset coverage per share ............................ $ 126.10 $ 124.13 $ 107.83 $ 112.26 $ 100.10
AUCTION RATE SERIES C CUMULATIVE PREFERRED STOCK
Liquidation value, end of period (in 000's) ......... $ 25,000 $ 25,000 $ 25,000 $ 25,000 $ 25,000
Total shares outstanding (in 000's) ................. 1 1 1 1 1
Liquidation preference per share .................... $ 25,000 $ 25,000 $ 25,000 $ 25,000 $ 25,000
Average market value (b) ............................ $ 25,000 $ 25,000 $ 25,000 $ 25,000 $ 25,000
Asset coverage per share ............................ $ 126,101 $ 124,134 $ 107,825 $ 112,257 $ 100,097
ASSET COVERAGE (c) .................................. 504% 497% 431% 449% 400%
----------
+ Based on net asset value per share, adjusted for reinvestment of
distributions at prices obtained under the Fund's dividend reinvestment
plan.
++ Based on market value per share, adjusted for reinvestment of
distributions at prices obtained under the Fund's dividend reinvestment
plan.
(a) Calculated based upon average common shares outstanding on the record
dates throughout the year.
(b) Based on weekly prices.
(c) Asset coverage is calculated by combining all series of preferred stock.
(d) Amount represents less than $0.005 per share.
(e) For the years ended December 31, 2007, 2006 and 2005, the effect of the
custodian fee credits was minimal.
See accompanying notes to financial statements.
16
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Directors and Shareholders of
The Gabelli Global Multimedia Trust Inc.:
In our opinion, the accompanying statement of assets and liabilities, including
the schedule of investments, and the related statements of operations and of
changes in net assets and the financial highlights present fairly, in all
material respects, the financial position of The Gabelli Global Multimedia Trust
Inc. (hereafter referred to as the "Trust") at December 31, 2007, the results of
its operations for the year then ended, the changes in its net assets for each
of the two years in the period then ended and the financial highlights for each
of the five years in the period then ended, in conformity with accounting
principles generally accepted in the United States of America. These financial
statements and financial highlights (hereafter referred to as "financial
statements") are the responsibility of the Trust's management. Our
responsibility is to express an opinion on these financial statements based on
our audits. We conducted our audits of these financial statements in accordance
with the standards of the Public Company Accounting Oversight Board (United
States). Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities at December 31, 2007 by
correspondence with the custodian and brokers, provide a reasonable basis for
our opinion.
PricewaterhouseCoopers LLP
New York, New York
February 29, 2008
17
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
ADDITIONAL FUND INFORMATION (UNAUDITED)
The business and affairs of the Fund are managed under the direction of the
Fund's Board of Directors. Information pertaining to the Directors and officers
of the Fund is set forth below. The Fund's Statement of Additional Information
includes additional information about the Fund's Directors and is available,
without charge, upon request, by calling 800-GABELLI (800-422-3554) or by
writing to The Gabelli Global Multimedia Trust Inc. at One Corporate Center,
Rye, NY 10580-1422.
NUMBER OF
TERM OF FUNDS IN FUND
NAME, POSITION(S) OFFICE AND COMPLEX
ADDRESS(1) LENGTH OF OVERSEEN BY PRINCIPAL OCCUPATION(S) OTHER DIRECTORSHIPS
AND AGE TIME SERVED(2) DIRECTOR DURING PAST FIVE YEARS HELD BY DIRECTOR(5)
------------------------- -------------- ------------- -------------------------------- ----------------------------------
INTERESTED DIRECTORS(3):
MARIO J. GABELLI Since 1994** 26 Chairman and Chief Executive Director of Morgan Group
Director and Officer of GAMCO Investors, Inc. Holdings, Inc. (holding company);
Chief Investment Officer and Chief Investment Officer - Chairman of the Board of LICT
Age: 65 Value Portfolios of Gabelli Corp. (multimedia and
Funds, LLC and GAMCO Asset communication services company)
Management Inc.; Director/
Trustee or Chief Investment
Officer of other registered
investment companies in the
Gabelli/ GAMCO Funds complex;
Chairman and Chief Executive
Officer of GGCP, Inc.
INDEPENDENT DIRECTORS(6):
THOMAS E. BRATTER Since 1994** 4 Director, President and Founder --
Director of The John Dewey Academy
Age: 68 (residential college preparatory
therapeutic high school)
ANTHONY J. COLAVITA(4) Since 2001** 35 Partner in the law firm of --
Director Anthony J. Colavita, P.C.
Age: 72
JAMES P. CONN(4) Since 1994* 16 Former Managing Director and --
Director Chief Investment Officer of
Age: 69 Financial Security Assurance
Holdings Ltd. (insurance
holding company) (1992-1998)
FRANK J. FAHRENKOPF JR. Since 1999*** 5 President and Chief Executive --
Director Officer of the American Gaming
Age: 68 Association; Co-Chairman of the
Commission on Presidential
Debates; Former Chairman of the
Republican National Committee
(1983-1989)
ANTHONY R. PUSTORINO Since 1994* 14 Certified Public Accountant; Director of The LGL Group, Inc.
Director Professor Emeritus, Pace (diversified manufacturing)
Age: 82 University
WERNER J. ROEDER, MD Since 1999*** 23 Medical Director of Lawrence --
Director Hospital and practicing private
Age: 67 physician
SALVATORE J. ZIZZA Since 1994*** 26 Chairman of Zizza & Co., Ltd. Director of Hollis-Eden Pharmace-
Director (consulting) uticals (biotechnology) and Earl
Age: 62 Scheib, Inc. (automotive services)
18
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
ADDITIONAL FUND INFORMATION (UNAUDITED) (CONTINUED)
TERM OF
NAME, POSITION(S) OFFICE AND
ADDRESS(1) LENGTH OF PRINCIPAL OCCUPATION(S)
AND AGE TIME SERVED(2) DURING PAST FIVE YEARS
---------------------------- -------------- ----------------------------------------------------------------------------
OFFICERS:
BRUCE N. ALPERT Since 2003 Executive Vice President and Chief Operating Officer of Gabelli Funds, LLC
President since 1988 and an officer of most of the registered investment companies in
Age: 56 the Gabelli/GAMCO Funds complex. Director and President of the Gabelli
Advisers, Inc. since 1998
LAURISSA M. MARTIRE Since 2004 Vice President of The Gabelli Convertible and Income Securities Fund Inc.
Vice President since 2004; Assistant Vice President of GAMCO Investors, Inc. since 2003;
Age: 31 Prior to 2003, Sales Assistant for GAMCO Investors, Inc.
LOAN P. NGUYEN Since 2004 Vice President of The Gabelli Equity Trust Inc. since 2006; Assistant Vice
Vice President and Ombudsman President of GAMCO Investors, Inc. since 2006; Portfolio Administrator for
Age: 25 Gabelli Funds, LLC during 2004; Student at Boston College prior to 2004
JAMES E. MCKEE Since 1995 Vice President, General Counsel, and Secretary of GAMCO Investors, Inc.
Secretary since 1999 and GAMCO Asset Management Inc. since 1993; Secretary of all of
Age: 44 the registered investment companies in the Gabelli/GAMCO Funds complex
AGNES MULLADY Since 2006 Vice President of Gabelli Funds, LLC since 2007; Officer of all of the
Treasurer registered investment companies in the Gabelli/GAMCO Funds complex; Senior
Age: 49 Vice President of U.S. Trust Company, N.A. and Treasurer and Chief
Financial Officer of Excelsior Funds from 2004 through 2005; Chief
Financial Officer of AMIC Distribution Partners from 2002 through 2004;
Controller of Reserve Management Corporation and Reserve Partners, Inc. and
Treasurer of Reserve Funds from 2000 through 2002
PETER D. GOLDSTEIN Since 2004 Director of Regulatory Affairs at GAMCO Investors, Inc. since 2004; Chief
Chief Compliance Officer Compliance Officer of all of the registered investment companies in the
Age: 54 Gabelli/GAMCO Funds complex; Vice President of Goldman Sachs Asset
Management from 2000 through 2004
----------
(1) Address: One Corporate Center, Rye, NY 10580-1422, unless otherwise noted.
(2) The Fund's Board of Directors is divided into three classes, each class
having a term of three years. Each year the term of office of one class
expires and the successor or successors elected to such class serve for a
three year term. The three year term for each class expires as follows:
* - Term expires at the Fund's 2009 Annual Meeting of Shareholders or
until their successors are duly elected and qualified.
** - Term expires at the Fund's 2010 Annual Meeting of Shareholders or
until their successors are duly elected and qualified.
*** - Term expires at the Fund's 2008 Annual Meeting of Shareholders or
until their successors are duly elected and qualified.
Each officer will hold office for an indefinite term until the date he or
she resigns or retires or until his or her successor is elected and
qualified.
(3) "Interested person" of the Fund as defined in the Investment Company Act
of 1940, as amended (the "1940 Act"). Mr. Gabelli is considered an
"interested person" because of his affiliation with Gabelli Funds, LLC
which acts as the Fund's investment adviser, and Gabelli & Company, Inc.,
which executes portfolio transactions for the Fund, and as a controlling
shareholder because of the level of his ownership of common shares of the
Fund.
(4) Represents holders of the Fund's Preferred Stock.
(5) This column includes only directorships of companies required to report to
the SEC under the Securities Exchange Act of 1934, as amended (i.e. public
companies) or other investment companies registered under the 1940 Act.
(6) Directors who are not interested persons are considered "Independent"
Directors.
CERTIFICATIONS
The Fund's Chief Executive Officer has certified to the New York Stock
Exchange ("NYSE") that, as of June 13, 2007, he was not aware of any violation
by the Fund of applicable NYSE corporate governance listing standards. The Fund
reports to the SEC on Form N-CSR which contains certifications by the Fund's
principal executive officer and principal financial officer that relate to the
Fund's disclosure in such reports and that are required by Rule 30a-2(a) under
the 1940 Act.
19
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
INCOME TAX INFORMATION (UNAUDITED)
DECEMBER 31, 2007
CASH DIVIDENDS AND DISTRIBUTIONS
TOTAL AMOUNT ORDINARY LONG-TERM DIVIDEND
PAYABLE RECORD PAID INVESTMENT CAPITAL REINVESTMENT
DATE DATE PER SHARE INCOME GAINS(a) PRICE
------- -------- ------------ ---------- --------- ------------
COMMON SHARES
03/26/07 03/16/07 $ 0.15000 $ 0.06840 $ 0.08160 $ 13.01380
06/25/07 06/15/07 0.15000 0.06840 0.08160 13.93310
09/24/07 09/14/07 0.15000 0.06840 0.08160 13.96810
12/17/07 12/12/07 0.30000 0.13680 0.16320 13.69430
--------- --------- ---------
$ 0.75000 $ 0.34200 $ 0.40800
--------- --------- ---------
6.00% PREFERRED SHARES
03/26/07 03/19/07 $ 0.37500 $ 0.17100 $ 0.20400
06/26/07 06/19/07 0.37500 0.17100 0.20400
09/26/07 09/19/07 0.37500 0.17100 0.20400
12/26/07 12/18/06 0.37500 0.17100 0.20400
--------- --------- ---------
$ 1.50000 $ 0.68400 $ 0.81600
--------- --------- ---------
AUCTION RATE PREFERRED SHARES
Auction Rate Preferred Shares pay dividends weekly based on a rate set at
auction, usually held every seven days. The percentage of 2007 distributions
derived from long-term capital gains for the Auction Rate Preferred Shares was
54.40%.
A Form 1099-DIV has been mailed to all shareholders of record for the
distributions mentioned above, setting forth specific amounts to be included in
the 2007 tax returns. Ordinary income distributions include net investment
income and realized net short-term capital gains. Ordinary income is reported in
box 1a of Form 1099-DIV. Capital gain distributions are reported in box 2a of
Form 1099-DIV. The long-term gain distributions for the year ended December 31,
2007 were $7,259,051, or the maximum allowable.
CORPORATE DIVIDENDS RECEIVED DEDUCTION, QUALIFIED DIVIDEND INCOME, AND U.S.
GOVERNMENT SECURITIES INCOME
The Fund paid to common and 6.00% Series B Preferred shareholders ordinary
income dividends of $0.3420 and $0.6840 per share, respectively, in 2007. The
Fund paid weekly distributions to Series C Auction Rate Preferred shareholders
at varying rates throughout the year, including an ordinary income dividend
totaling $615.6213 per share in 2007. For the year ended December 31, 2007,
23.26% of the ordinary dividend qualified for the dividends received deduction
available to corporations, and 68.30% of the ordinary income distribution was
qualified dividend income. The percentage of ordinary income dividends paid by
the Fund during 2007 derived from U.S. Treasury Securities was 0.41%. Such
income is exempt from state and local tax in all states. However, many states,
including New York and California, allow a tax exemption for a portion of the
income earned only if a mutual fund has invested at least 50% of its assets at
the end of each quarter of the Fund's fiscal year in U.S. Government Securities.
The Fund did not meet this strict requirement in 2007. The percentage of net
assets of U.S. Government Securities held as of December 31, 2007 was 4.16%.
HISTORICAL DISTRIBUTION SUMMARY
SHORT- LONG-
TERM TERM NON-TAXABLE ADJUSTMENT
INVESTMENT CAPITAL CAPITAL RETURN OF TOTAL TO
INCOME(b) GAINS(b) GAINS CAPITAL DISTRIBUTIONS(e) COST BASIS
---------- ---------- ---------- ----------- ---------------- ------------
COMMON STOCK
2007 .................... $ 0.07790 $ 0.26410 $ 0.40800 -- $ 0.75000 --
2006 .................... 0.23073 0.01224 0.38703 -- 0.63000 --
2005 .................... 0.12450 0.00800 0.46750 -- 0.60000 --
2004 .................... -- -- -- -- -- --
2003 .................... -- -- -- -- -- --
2002 .................... -- -- -- -- -- --
2001 .................... 0.00580 0.01060 0.04360 -- 0.06000 --
2000(a) ................. 0.16300 0.20880 1.20320 -- 1.57500 --
1999 .................... -- 1.28340 2.33660 -- 3.62000 --
1998 .................... -- 0.19950 0.60050 -- 0.80000 --
1997 .................... 0.00580 0.26820 0.57600 -- 0.85000 --
1996 .................... 0.01030 0.07900 0.28570 -- 0.37500 --
1995(c) ................. 0.07880 0.15290 0.01830 -- 0.25000 --
1994 .................... 0.03050 0.00100 0.00140 $0.01710 0.05000 $0.01710(d)
6.00% PREFERRED STOCK
2007 .................... $ 0.15560 $ 0.52840 $ 0.81600 -- $ 1.50000 --
2006 .................... 0.54940 0.02930 0.91230 -- 1.50000 --
2005 .................... 0.31120 0.02000 1.16880 -- 1.50000 --
2004 .................... 0.41320 0.28440 0.80240 -- 1.50000 --
2003 -- -- 1.10420 -- 1.10420 --
AUCTION RATE PREFERRED STOCK
2007 .................... $140.12030 $475.50103 $734.35867 -- $1,349.98000 --
2006 .................... 447.80000 23.74500 751.09500 -- 1,222.64000 --
2005 .................... 172.40170 11.08530 647.7330 -- 831.22000 --
2004 .................... 103.27300 71.04640 200.52090 -- 374.87000 --
2003 -- -- 227.06000 -- 227.06000 --
----------
(a) On June 19, 2000, the Company also distributed Rights equivalent to $1.46
per share based upon full subscription of all issued shares.
(b) Taxable as ordinary income.
(c) On August 11, 1995, the Company also distributed Rights equivalent to
$0.46 per share based upon full subscription of all issued shares.
(d) Decrease in cost basis.
(e) Total amounts may differ due to rounding.
20
AUTOMATIC DIVIDEND REINVESTMENT
AND VOLUNTARY CASH PURCHASE PLANS
ENROLLMENT IN THE PLAN
It is the policy of The Gabelli Global Multimedia Trust Inc. (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 shares of common stock 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 stock 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 must submit this
request in writing to:
The Gabelli Global Multimedia Trust Inc.
c/o Computershare
P.O. Box 43010
Providence, RI 02940-3010
Shareholders requesting this cash election must include the shareholder's
name and address as they appear on the share certificate. Shareholders with
additional questions regarding the Plan or requesting a copy of the terms of the
Plan may contact Computershare at (800) 336-6983.
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 reregistered 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 shares of common stock 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 stock 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 shares of common stock 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 stock. The valuation date is
the dividend or distribution payment date or, if that date is not a New York
Stock Exchange ("NYSE") trading day, the next trading day. If the net asset
value of the common stock at the time of valuation exceeds the market price of
the common stock, participants will receive 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 shares of common stock
in the open market, or on the NYSE 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 stock 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.
21
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 common
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 pro rata share of the
brokerage commissions. Brokerage charges for such purchases are expected to be
less than the usual brokerage charge for such transactions. It is suggested that
any voluntary cash payments be sent to Computershare, P.O. Box 43010,
Providence, RI 02940-3010 such that Computershare receives such payments
approximately 10 days before the 1st and 15th of the month. Funds not received
at least five 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 48 hours before such payment is to be
invested.
SHAREHOLDERS WISHING TO LIQUIDATE SHARES HELD AT COMPUTERSHARE must do so
in writing or by telephone. Please submit your request to the above mentioned
address or telephone number. Include in your request your name, address, and
account number. The cost to liquidate shares is $2.50 per transaction as well as
the brokerage commission incurred. Brokerage charges are expected to be less
than the usual brokerage charge 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 90 days before the record date for such dividend or distribution. The Plan
also may be amended or terminated by Computershare on at least 90 days written
notice to participants in the Plan.
--------------------------------------------------------------------------------
The Annual Meeting of The Gabelli Global Multimedia Trust's shareholders will be
held on Monday, May 19, 2008 at the Greenwich Library in Greenwich, Connecticut.
--------------------------------------------------------------------------------
22
[GRAPHIC OMITTED]
DIRECTORS AND OFFICERS
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
ONE CORPORATE CENTER, RYE, NY 10580-1422
DIRECTORS OFFICERS
Mario J. Gabelli, CFA Bruce N. Alpert
CHAIRMAN & CHIEF EXECUTIVE OFFICER, PRESIDENT
GAMCO INVESTORS, INC.
Peter D. Goldstein
Dr. Thomas E. Bratter CHIEF COMPLIANCE OFFICER
PRESIDENT & FOUNDER, JOHN DEWEY ACADEMY
Laurissa M. Martire
Anthony J. Colavita VICE PRESIDENT
ATTORNEY-AT-LAW,
ANTHONY J. COLAVITA, P.C. James E. McKee
SECRETARY
James P. Conn
FORMER MANAGING DIRECTOR & Agnes Mullady
CHIEF INVESTMENT OFFICER, TREASURER
FINANCIAL SECURITY ASSURANCE HOLDINGS LTD.
LoAn P. Nguyen
Frank J. Fahrenkopf, Jr. VICE PRESIDENT & OMBUDSMAN
PRESIDENT & CHIEF EXECUTIVE OFFICER,
AMERICAN GAMING ASSOCIATION INVESTMENT ADVISER
Gabelli Funds, LLC
Anthony R. Pustorino One Corporate Center
CERTIFIED PUBLIC ACCOUNTANT, Rye, New York 10580-1422
PROFESSOR EMERITUS, PACE UNIVERSITY
CUSTODIAN
Werner J. Roeder, MD State Street Bank and Trust Company
MEDICAL DIRECTOR,
LAWRENCE HOSPITAL COUNSEL
Willkie Farr & Gallagher LLP
Salvatore J. Zizza
CHAIRMAN, ZIZZA & CO., LTD. TRANSFER AGENT AND REGISTRAR
Computershare Trust Company, N.A.
STOCK EXCHANGE LISTING
6.00%
Common Preferred
---------- -----------
NYSE-Symbol: GGT GGT PrB
Shares Outstanding: 14,001,353 993,100
The Net Asset Value per share appears in
the Publicly Traded Funds column, under
the heading "Specialized Equity Funds,"
in Monday's The Wall Street Journal. It
is also listed in Barron's Mutual
Funds/Closed End Funds section under the
heading "Specialized Equity Funds."
The Net Asset Value per share may be
obtained each day by calling (914)
921-5070 or visiting www.gabelli.com.
--------------------------------------------------------------------------------
For general information about the Gabelli Funds, call 800-GABELLI
(800-422-3554), fax us at 914-921-5118, visit Gabelli Funds' Internet homepage
at: WWW.GABELLI.COM, or e-mail us at: closedend@gabelli.com
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940, as amended, that the Fund may, from time to time, purchase
shares of its common stock in the open market when the Fund's shares are trading
at a discount of 10% or more from the net asset value of the shares. The Fund
may also, from time to time, purchase shares of its Cumulative Preferred Stock
in the open market when the shares are trading at a discount to liquidation
value.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
THE GABELLI GLOBAL MULTIMEDIA TRUST INC.
ONE CORPORATE CENTER, RYE, NY 10580-1422
PHONE: 800-GABELLI (800-422-3554)
FAX: 914-921-5118 INTERNET: WWW.GABELLI.COM
E-MAIL: CLOSEDEND@GABELLI.COM GGT Q4/2007
--------------------------------------------------------------------------------
ITEM 2. CODE OF ETHICS.
(a) The registrant, as of the end of the period covered by this report, has
adopted a code of ethics that applies to the registrant's principal
executive officer, principal financial officer, principal accounting
officer or controller, or persons performing similar functions,
regardless of whether these individuals are employed by the registrant
or a third party.
(c) There have been no amendments, during the period covered by this
report, to a provision of the code of ethics that applies to the
registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing
similar functions, regardless of whether these individuals are employed
by the registrant or a third party, and that relates to any element of
the code of ethics description.
(d) The registrant has not granted any waivers, including an implicit
waiver, from a provision of the code of ethics that applies to the
registrant's principal executive officer, principal financial officer,
principal accounting officer or controller, or persons performing
similar functions, regardless of whether these individuals are employed
by the registrant or a third party, that relates to one or more of the
items set forth in paragraph (b) of this item's instructions.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
As of the end of the period covered by the report, the registrant's Board of
Directors has determined that Anthony R. Pustorino is qualified to serve as an
audit committee financial expert serving on its audit committee and that he is
"independent," as defined by Item 3 of Form N-CSR.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
AUDIT FEES
(a) The aggregate fees billed for each of the last two fiscal years for
professional services rendered by the principal accountant for the
audit of the registrant's annual financial statements or services that
are normally provided by the accountant in connection with statutory
and regulatory filings or engagements for those fiscal years are
$46,500 for 2006 and $48,800 for 2007.
AUDIT-RELATED FEES
(b) The aggregate fees billed in each of the last two fiscal years for
assurance and related services by the principal accountant that are
reasonably related to the performance of the audit of the registrant's
financial statements and are not reported under paragraph (a) of this
Item are $8,600 for 2006 and $7,200 for 2007. Audit-related fees
represent services provided in the preparation of Preferred Shares
Reports.
TAX FEES
(c) The aggregate fees billed in each of the last two fiscal years for
professional services rendered by the principal accountant for tax
compliance, tax advice, and tax planning are $3,100 for 2006 and 4,350
for 2007. Tax fees represent tax compliance services provided in
connection with the review of the Registrant's tax returns.
ALL OTHER FEES
(d) The aggregate fees billed in each of the last two fiscal years for
products and services provided by the principal accountant, other than
the services reported in paragraphs (a) through (c) of this Item are $0
for 2006 and $0 for 2007.
(e)(1) Disclose the audit committee's pre-approval policies and procedures
described in paragraph (c)(7) of Rule 2-01 of Regulation S-X.
Pre-Approval Policies and Procedures. The Audit Committee ("Committee")
of the registrant is responsible for pre-approving (i) all audit and
permissible non-audit services to be provided by the independent
registered public accounting firm to the registrant and (ii) all
permissible non-audit services to be provided by the independent
registered public accounting firm to the Adviser, Gabelli Funds, LLC,
and any affiliate of Gabelli Funds, LLC ("Gabelli") that provides
services to the registrant (a "Covered Services Provider") if the
independent registered public accounting firm's engagement related
directly to the operations and financial reporting of the registrant.
The Committee may delegate its responsibility to pre-approve any such
audit and permissible non-audit services to the Chairperson of the
Committee, and the Chairperson must report to the Committee, at its
next regularly scheduled meeting after the Chairperson's pre-approval
of such services, his or her decision(s). The Committee may also
establish detailed pre-approval policies and procedures for
pre-approval of such services in accordance with applicable laws,
including the delegation of some or all of the Committee's pre-approval
responsibilities to the other persons (other than Gabelli or the
registrant's officers). Pre-approval by the Committee of any
permissible non-audit services is not required so long as: (i) the
permissible non-audit services were not recognized by the registrant at
the time of the engagement to be non-audit services; and (ii) such
services are promptly brought to the attention of the Committee and
approved by the Committee or Chairperson prior to the completion of the
audit.
(e)(2) The percentage of services described in each of paragraphs (b) through
(d) of this Item that were approved by the audit committee pursuant to
paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X are as follows:
(b) 100%
(c) 100%
(d) Not applicable
(f) The percentage of hours expended on the principal accountant's
engagement to audit the registrant's financial statements for the most
recent fiscal year that were attributed to work performed by persons
other than the principal accountant's full-time, permanent employees
was zero percent (0%).
(g) The aggregate non-audit fees billed by the registrant's accountant for
services rendered to the registrant, and rendered to the registrant's
investment adviser (not including any sub-adviser whose role is
primarily portfolio management and is subcontracted with or overseen by
another investment adviser), and any entity controlling, controlled by,
or under common control with the adviser that provides ongoing services
to the registrant for each of the last two fiscal years of the
registrant was $0 for 2006 and $0 for 2007.
(h) The registrant's audit committee of the board of directors has
considered whether the provision of non-audit services that were
rendered to the registrant's investment adviser (not including any
sub-adviser whose role is primarily portfolio management and is
subcontracted with or overseen by another investment adviser), and any
entity controlling, controlled by, or under common control with the
investment adviser that provides ongoing services to the registrant
that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule
2-01 of Regulation S-X is compatible with maintaining the principal
accountant's independence.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
The registrant has a separately designated audit committee consisting of
the following members: Anthony R. Pustorino, Werner J. Roeder and Salvatore J.
Zizza.
ITEM 6. SCHEDULE OF INVESTMENTS.
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.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
The Proxy Voting Policies are attached herewith.
THE VOTING OF PROXIES ON BEHALF OF CLIENTS
Rules 204(4)-2 and 204-2 under the Investment Advisers Act of 1940 and
Rule 30b1-4 under the Investment Company Act of 1940 require investment advisers
to adopt written policies and procedures governing the voting of proxies on
behalf of their clients.
These procedures will be used by GAMCO Asset Management Inc., Gabelli
Funds, LLC, Gabelli Securities, Inc., and Teton Advisors, Inc. (collectively,
the "Advisers") to determine how to vote proxies relating to portfolio
securities held by their clients, including the procedures that the Advisers use
when a vote presents a conflict between the interests of the shareholders of an
investment company managed by one of the Advisers, on the one hand, and those of
the Advisers; the principal underwriter; or any affiliated person of the
investment company, the Advisers, or the principal underwriter. These procedures
will not apply where the Advisers do not have voting discretion or where the
Advisers have agreed to with a client to vote the client's proxies in accordance
with specific guidelines or procedures supplied by the client (to the extent
permitted by ERISA).
I. PROXY VOTING COMMITTEE
The Proxy Voting Committee was originally formed in April 1989 for the
purpose of formulating guidelines and reviewing proxy statements within the
parameters set by the substantive proxy voting guidelines originally published
in 1988 and updated periodically, a copy of which are appended as Exhibit A. The
Committee will include representatives of Research, Administration, Legal, and
the Advisers. Additional or replacement members of the Committee will be
nominated by the Chairman and voted upon by the entire Committee.
Meetings are held as needed basis to form views on the manner in which
the Advisers should vote proxies on behalf of their clients.
In general, the Director of Proxy Voting Services, using the Proxy
Guidelines, recommendations of Institutional Shareholder Corporate Governance
Service ("ISS"), other third-party services and the analysts of Gabelli &
Company, Inc., will determine how to vote on each issue. For non-controversial
matters, the Director of Proxy Voting Services may vote the proxy if the vote is
(1) consistent with the recommendations of the issuer's Board of Directors and
not contrary to the Proxy Guidelines; (2) consistent with the recommendations of
the issuer's Board of Directors and is a non-controversial issue not covered by
the Proxy Guidelines; or (3) the vote is contrary to the recommendations of the
Board of Directors but is consistent with the Proxy Guidelines. In those
instances, the Director of Proxy Voting Services or the Chairman of the
Committee may sign and date the proxy statement indicating how each issue will
be voted.
All matters identified by the Chairman of the Committee, the Director
of Proxy Voting Services or the Legal Department as controversial, taking into
account the recommendations of ISS or other third party services and the
analysts of Gabelli & Company, Inc., will be presented to the Proxy Voting
Committee. If the Chairman of the Committee, the Director of Proxy Voting
Services or the Legal Department has identified the matter as one that (1) is
controversial; (2) would benefit from deliberation by the Proxy Voting
Committee; or (3) may give rise to a conflict of interest between the Advisers
and their clients, the Chairman of the Committee will initially determine what
vote to recommend that the Advisers should cast and the matter will go before
the Committee.
A. CONFLICTS OF INTEREST.
The Advisers have implemented these proxy voting procedures in
order to prevent conflicts of interest from influencing their
proxy voting decisions. By following the Proxy Guidelines, as
well as the recommendations of ISS, other third-party services
and the analysts of Gabelli & Company, the Advisers are able
to avoid, wherever possible, the influence of potential
conflicts of interest. Nevertheless, circumstances may arise
in which one or more of the Advisers are faced with a conflict
of interest or the appearance of a conflict of interest in
connection with its vote. In general, a conflict of interest
may arise when an Adviser knowingly does business with an
issuer, and may appear to have a material conflict between its
own interests and the interests of the shareholders of an
investment company managed by one of the Advisers regarding
how the proxy is to be voted. A conflict also may exist when
an Adviser has actual knowledge of a material business
arrangement between an issuer and an affiliate of the Adviser.
In practical terms, a conflict of interest may arise, for
example, when a proxy is voted for a company that is a client
of one of the Advisers, such as GAMCO Asset Management Inc. A
conflict also may arise when a client of one of the Advisers
has made a shareholder proposal in a proxy to be voted upon by
one or more of the Advisers. The Director of Proxy Voting
Services, together with the Legal Department, will scrutinize
all proxies for these or other situations that may give rise
to a conflict of interest with respect to the voting of
proxies.
B. OPERATION OF PROXY VOTING COMMITTEE
For matters submitted to the Committee, each member of the
Committee will receive, prior to the meeting, a copy of the
proxy statement, any relevant third party research, a summary
of any views provided by the Chief Investment Officer and any
recommendations by Gabelli & Company, Inc. analysts. The Chief
Investment Officer or the Gabelli & Company, Inc. analysts may
be invited to present their viewpoints. If the Director of
Proxy Voting Services or the Legal Department believe that the
matter before the committee is one with respect to which a
conflict of interest may exist between the Advisers and their
clients, counsel will provide an opinion to the Committee
concerning the conflict. If the matter is one in which the
interests of the clients of one or more of Advisers may
diverge, counsel will so advise and the Committee may make
different recommendations as to different clients. For any
matters where the recommendation may trigger appraisal rights,
counsel will provide an opinion concerning the likely risks
and merits of such an appraisal action.
Each matter submitted to the Committee will be determined by the vote
of a majority of the members present at the meeting. Should the vote concerning
one or more recommendations be tied in a vote of the Committee, the Chairman of
the Committee will cast the deciding vote. The Committee will notify the proxy
department of its decisions and the proxies will be voted accordingly.
Although the Proxy Guidelines express the normal preferences for the
voting of any shares not covered by a contrary investment guideline provided by
the client, the Committee is not bound by the preferences set forth in the Proxy
Guidelines and will review each matter on its own merits. Written minutes of all
Proxy Voting Committee meetings will be maintained. The Advisers subscribe to
ISS, which supplies current information on companies, matters being voted on,
regulations, trends in proxy voting and information on corporate governance
issues.
If the vote cast either by the analyst or as a result of the
deliberations of the Proxy Voting Committee runs contrary to the recommendation
of the Board of Directors of the issuer, the matter will be referred to legal
counsel to determine whether an amendment to the most recently filed Schedule
13D is appropriate.
II. SOCIAL ISSUES AND OTHER CLIENT GUIDELINES
If a client has provided special instructions relating to the voting of
proxies, they should be noted in the client's account file and forwarded to the
proxy department. This is the responsibility of the investment professional or
sales assistant for the client. In accordance with Department of Labor
guidelines, the Advisers' policy is to vote on behalf of ERISA accounts in the
best interest of the plan participants with regard to social issues that carry
an economic impact. Where an account is not governed by ERISA, the Advisers will
vote shares held on behalf of the client in a manner consistent with any
individual investment/voting guidelines provided by the client. Otherwise the
Advisers will abstain with respect to those shares.
III. CLIENT RETENTION OF VOTING RIGHTS
If a client chooses to retain the right to vote proxies or if there is
any change in voting authority, the following should be notified by the
investment professional or sales assistant for the client.
- Operations
- Legal Department
- Proxy Department
- Investment professional assigned to the account
In the event that the Board of Directors (or a Committee thereof) of
one or more of the investment companies managed by one of the Advisers has
retained direct voting control over any security, the Proxy Voting Department
will provide each Board Member (or Committee member) with a copy of the proxy
statement together with any other relevant information including recommendations
of ISS or other third-party services.
IV. VOTING RECORDS
The Proxy Voting Department will retain a record of matters voted upon
by the Advisers for their clients. The Advisers will supply information on how
an account voted its proxies upon request.
A letter is sent to the custodians for all clients for which the
Advisers have voting responsibility instructing them to forward all proxy
materials to:
[Adviser name]
Attn: Proxy Voting Department
One Corporate Center
Rye, New York 10580-1433
The sales assistant sends the letters to the custodians along with the
trading/DTC instructions. Proxy voting records will be retained in compliance
with Rule 204-2 under the Investment Advisers Act.
V. VOTING PROCEDURES
1. Custodian banks, outside brokerage firms and clearing firms are responsible
for forwarding proxies directly to the Advisers.
Proxies are received in one of two forms:
o Shareholder Vote Authorization Forms ("VAFs") - Issued by Broadridge
Financial Solutions, Inc. ("Broadridge") VAFs must be voted through the
issuing institution causing a time lag. Broadridge is an outside service
contracted by the various institutions to issue proxy materials.
o Proxy cards which may be voted directly.
2. Upon receipt of the proxy, the number of shares each form represents is
logged into the proxy system according to security.
3. In the case of a discrepancy such as an incorrect number of shares, an
improperly signed or dated card, wrong class of security, etc., the issuing
custodian is notified by phone. A corrected proxy is requested. Any arrangements
are made to insure that a proper proxy is received in time to be voted
(overnight delivery, fax, etc.). When securities are out on loan on record date,
the custodian is requested to supply written verification.
4. Upon receipt of instructions from the proxy committee (see Administrative),
the votes are cast and recorded for each account on an individual basis.
Records have been maintained on the Proxy Edge system. The system is backed up
regularly.
Proxy Edge records include:
Security Name and Cusip Number
Date and Type of Meeting (Annual, Special, Contest)
Client Name
Adviser or Fund Account Number
Directors' Recommendation
How GAMCO voted for the client on each issue
5. VAFs are kept alphabetically by security. Records for the current proxy
season are located in the Proxy Voting Department office. In preparation for the
upcoming season, files are transferred to an offsite storage facility during
January/February.
6. Shareholder Vote Authorization Forms issued by Broadridge are always sent
directly to a specific individual at Broadridge.
7. If a proxy card or VAF is received too late to be voted in the conventional
matter, every attempt is made to vote on one of the following manners:
o VAFs can be faxed to Broadridge up until the time of the meeting. This is
followed up by mailing the original form.
o When a solicitor has been retained, the solicitor is called. At the
solicitor's direction, the proxy is faxed.
8. In the case of a proxy contest, records are maintained for each opposing
entity.
9. Voting in Person
a) At times it may be necessary to vote the shares in person. In this case, a
"legal proxy" is obtained in the following manner:
o Banks and brokerage firms using the services at Broadridge:
The back of the VAF is stamped indicating that we wish to vote in person.
The forms are then sent overnight to Broadridge. Broadridge issues individual
legal proxies and sends them back via overnight (or the Adviser can pay
messenger charges). A lead-time of at least two weeks prior to the meeting is
needed to do this. Alternatively, the procedures detailed below for banks not
using Broadridge may be implemented.
o Banks and brokerage firms issuing proxies directly:
The bank is called and/or faxed and a legal proxy is requested.
All legal proxies should appoint:
"REPRESENTATIVE OF [ADVISER NAME] WITH FULL POWER OF SUBSTITUTION."
b) The legal proxies are given to the person attending the meeting along with
the following supplemental material:
o A limited Power of Attorney appointing the attendee an Adviser
representative.
o A list of all shares being voted by custodian only. Client names and account
numbers are not included. This list must be presented, along with the
proxies, to the Inspectors of Elections and/or tabulator at least one-half
hour prior to the scheduled start of the meeting. The tabulator must
"qualify" the votes (i.e. determine if the vote have previously been cast, if
the votes have been rescinded, etc. vote have previously been cast, etc.).
o A sample ERISA and Individual contract.
o A sample of the annual authorization to vote proxies form.
o A copy of our most recent Schedule 13D filing (if applicable).
APPENDIX A
PROXY GUIDELINES
PROXY VOTING GUIDELINES
GENERAL POLICY STATEMENT
It is the policy of GAMCO INVESTORS, INC. to vote in the best economic interests
of our clients. As we state in our Magna Carta of Shareholders Rights,
established in May 1988, we are neither FOR nor AGAINST management. We are for
shareholders.
At our first proxy committee meeting in 1989, it was decided that each proxy
statement should be evaluated on its own merits within the framework first
established by our Magna Carta of Shareholders Rights. The attached guidelines
serve to enhance that broad framework.
We do not consider any issue routine. We take into consideration all of our
research on the company, its directors, and their short and long-term goals for
the company. In cases where issues that we generally do not approve of are
combined with other issues, the negative aspects of the issues will be factored
into the evaluation of the overall proposals but will not necessitate a vote in
opposition to the overall proposals.
BOARD OF DIRECTORS
The advisers do not consider the election of the Board of Directors a routine
issue. Each slate of directors is evaluated on a case-by-case basis.
Factors taken into consideration include:
o Historical responsiveness to shareholders
This may include such areas as:
-Paying greenmail
-Failure to adopt shareholder resolutions receiving a majority of
shareholder votes
o Qualifications
o Nominating committee in place
o Number of outside directors on the board
o Attendance at meetings
o Overall performance
SELECTION OF AUDITORS
In general, we support the Board of Directors' recommendation for auditors.
BLANK CHECK PREFERRED STOCK
We oppose the issuance of blank check preferred stock.
Blank check preferred stock allows the company to issue stock and establish
dividends, voting rights, etc. without further shareholder approval.
CLASSIFIED BOARD
A classified board is one where the directors are divided into classes with
overlapping terms. A different class is elected at each annual meeting.
While a classified board promotes continuity of directors facilitating long
range planning, we feel directors should be accountable to shareholders on an
annual basis. We will look at this proposal on a case-by-case basis taking into
consideration the board's historical responsiveness to the rights of
shareholders.
Where a classified board is in place we will generally not support attempts to
change to an annually elected board.
When an annually elected board is in place, we generally will not support
attempts to classify the board.
INCREASE AUTHORIZED COMMON STOCK
The request to increase the amount of outstanding shares is considered on a
case-by-case basis.
Factors taken into consideration include:
o Future use of additional shares
-Stock split
-Stock option or other executive compensation plan
-Finance growth of company/strengthen balance sheet
-Aid in restructuring
-Improve credit rating
-Implement a poison pill or other takeover defense
o Amount of stock currently authorized but not yet issued or reserved for
stock option plans
o Amount of additional stock to be authorized and its dilutive effect
We will support this proposal if a detailed and verifiable plan for the use of
the additional shares is contained in the proxy statement.
CONFIDENTIAL BALLOT
We support the idea that a shareholder's identity and vote should be treated
with confidentiality.
However, we look at this issue on a case-by-case basis.
In order to promote confidentiality in the voting process, we endorse the use of
independent Inspectors of Election.
CUMULATIVE VOTING
In general, we support cumulative voting.
Cumulative voting is a process by which a shareholder may multiply the number of
directors being elected by the number of shares held on record date and cast the
total number for one candidate or allocate the voting among two or more
candidates.
Where cumulative voting is in place, we will vote against any proposal to
rescind this shareholder right.
Cumulative voting may result in a minority block of stock gaining representation
on the board. When a proposal is made to institute cumulative voting, the
proposal will be reviewed on a case-by-case basis. While we feel that each board
member should represent all shareholders, cumulative voting provides minority
shareholders an opportunity to have their views represented.
DIRECTOR LIABILITY AND INDEMNIFICATION
We support efforts to attract the best possible directors by limiting the
liability and increasing the indemnification of directors, except in the case of
insider dealing.
EQUAL ACCESS TO THE PROXY
The SEC's rules provide for shareholder resolutions. However, the resolutions
are limited in scope and there is a 500 word limit on proponents' written
arguments. Management has no such limitations. While we support equal access to
the proxy, we would look at such variables as length of time required to
respond, percentage of ownership, etc.
FAIR PRICE PROVISIONS
Charter provisions requiring a bidder to pay all shareholders a fair price are
intended to prevent two-tier tender offers that may be abusive. Typically, these
provisions do not apply to board-approved transactions.
We support fair price provisions because we feel all shareholders should be
entitled to receive the same benefits.
Reviewed on a case-by-case basis.
GOLDEN PARACHUTES
Golden parachutes are severance payments to top executives who are terminated or
demoted after a takeover.
We support any proposal that would assure management of its own welfare so that
they may continue to make decisions in the best interest of the company and
shareholders even if the decision results in them losing their job. We do not,
however, support excessive golden parachutes. Therefore, each proposal will be
decided on a case-by-case basis.
NOTE: CONGRESS HAS IMPOSED A TAX ON ANY PARACHUTE THAT IS MORE THAN THREE TIMES
THE EXECUTIVE'S AVERAGE ANNUAL COMPENSATION.
ANTI-GREENMAIL PROPOSALS
We do not support greenmail. An offer extended to one shareholder should be
extended to all shareholders equally across the board.
LIMIT SHAREHOLDERS' RIGHTS TO CALL SPECIAL MEETINGS
We support the right of shareholders to call a special meeting.
CONSIDERATION OF NONFINANCIAL EFFECTS OF A MERGER
This proposal releases the directors from only looking at the financial effects
of a merger and allows them the opportunity to consider the merger's effects on
employees, the community, and consumers.
As a fiduciary, we are obligated to vote in the best economic interests of our
clients. In general, this proposal does not allow us to do that. Therefore, we
generally cannot support this proposal.
Reviewed on a case-by-case basis.
MERGERS, BUYOUTS, SPIN-OFFS, RESTRUCTURINGS
Each of the above is considered on a case-by-case basis. According to the
Department of Labor, we are not required to vote for a proposal simply because
the offering price is at a premium to the current market price. We may take into
consideration the long term interests of the shareholders.
MILITARY ISSUES
Shareholder proposals regarding military production must be evaluated on a
purely economic set of criteria for our ERISA clients. As such, decisions will
be made on a case-by-case basis.
In voting on this proposal for our non-ERISA clients, we will vote according to
the client's direction when applicable. Where no direction has been given, we
will vote in the best economic interests of our clients. It is not our duty to
impose our social judgment on others.
NORTHERN IRELAND
Shareholder proposals requesting the signing of the MacBride principles for the
purpose of countering the discrimination of Catholics in hiring practices must
be evaluated on a purely economic set of criteria for our ERISA clients. As
such, decisions will be made on a case-by-case basis.
In voting on this proposal for our non-ERISA clients, we will vote according to
client direction when applicable. Where no direction has been given, we will
vote in the best economic interests of our clients. It is not our duty to impose
our social judgment on others.
OPT OUT OF STATE ANTI-TAKEOVER LAW
This shareholder proposal requests that a company opt out of the coverage of the
state's takeover statutes. Example: Delaware law requires that a buyer must
acquire at least 85% of the company's stock before the buyer can exercise
control unless the board approves.
We consider this on a case-by-case basis. Our decision will be based on the
following:
o State of Incorporation
o Management history of responsiveness to shareholders
o Other mitigating factors
POISON PILL
In general, we do not endorse poison pills.
In certain cases where management has a history of being responsive to the needs
of shareholders and the stock is very liquid, we will reconsider this position.
REINCORPORATION
Generally, we support reincorporation for well-defined business reasons. We
oppose reincorporation if proposed solely for the purpose of reincorporating in
a state with more stringent anti-takeover statutes that may negatively impact
the value of the stock.
STOCK OPTION PLANS
Stock option plans are an excellent way to attract, hold and motivate directors
and employees. However, each stock option plan must be evaluated on its own
merits, taking into consideration the following:
o Dilution of voting power or earnings per share by more than 10%
o Kind of stock to be awarded, to whom, when and how much
o Method of payment
o Amount of stock already authorized but not yet issued under existing
stock option plans
SUPERMAJORITY VOTE REQUIREMENTS
Supermajority vote requirements in a company's charter or bylaws require a level
of voting approval in excess of a simple majority of the outstanding shares. In
general, we oppose supermajority-voting requirements. Supermajority requirements
often exceed the average level of shareholder participation. We support
proposals' approvals by a simple majority of the shares voting.
LIMIT SHAREHOLDERS RIGHT TO ACT BY WRITTEN CONSENT
Written consent allows shareholders to initiate and carry on a shareholder
action without having to wait until the next annual meeting or to call a special
meeting. It permits action to be taken by the written consent of the same
percentage of the shares that would be required to effect proposed action at a
shareholder meeting.
Reviewed on a case-by-case basis.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
PORTFOLIO MANAGERS
Mr. Mario J. Gabelli, CFA, is primarily responsible for the day-to-day
management of The Gabelli Global Multimedia Trust Inc., (the Trust). Mr. Gabelli
has served as Chairman, Chief Executive Officer, and Chief Investment Officer
-Value Portfolios of GAMCO Investors, Inc. and its affiliates since their
organization.
Lawrence J. Haverty, Jr., CFA, is associate portfolio manager of the Gabelli
Global Multimedia Trust. (2005 - present). Prior to 2005 Mr. Haverty was a
managing director for consumer discretionary research at State Street Research,
the Boston-based subsidiary of Metropolitan Life Insurance Company.
MANAGEMENT OF OTHER ACCOUNTS
The table below shows the number of other accounts managed by the portfolio
managers and the total assets in each of the following categories: registered
investment companies, other paid investment vehicles and other accounts. For
each category, the table also shows the number of accounts and the total assets
in the accounts with respect to which the advisory fee is based on account
performance.
------------------------- ------------------- ------------------- -------------- ----------------- ----------------
Total Assets
No. of Accounts in Accounts
Name of Portfolio Total where Advisory where Advisory
Manager or Type of No. of Accounts Total Fee is Based on Fee is Based
Team Member Accounts Managed Assets Performance on Performance
------------------------- ------------------- ------------------- -------------- ----------------- ----------------
--------------------------- ------------------- ------------------- -------------- ----------------- ----------------
1. Mario J. Gabelli Registered 23 $15.6B 6 $5.3B
Investment
Companies:
--------------------------- ------------------- ------------------- -------------- ----------------- ----------------
Other Pooled 12 $269.6M 11 $188.6M
Investment
Vehicles:
--------------------------- ------------------- ------------------- -------------- ----------------- ----------------
Other Accounts: 1991 $10.6B 6 $1.6B
--------------------------- ------------------- ------------------- -------------- ----------------- ----------------
2. Lawrence J. Haverty, Registered 0 $0 0 $0
Jr. Investment
Companies:
--------------------------- ------------------- ------------------- -------------- ----------------- ----------------
Other Pooled 0 $0 0 $0
Investment
Vehicles:
--------------------------- ------------------- ------------------- -------------- ----------------- ----------------
Other Accounts: 0 $0 0 $0
--------------------------- ------------------- ------------------- -------------- ----------------- ----------------
POTENTIAL CONFLICTS OF INTEREST
Actual or apparent conflicts of interest may arise when a Portfolio Manager also
has day-to-day management responsibilities with respect to one or more other
accounts. These potential conflicts include:
ALLOCATION OF LIMITED TIME AND ATTENTION. Because the portfolio managers manage
many accounts, they may not be able to formulate as complete a strategy or
identify equally attractive investment opportunities for each of those accounts
as might be the case if they were to devote all of their attention to the
management of only a few accounts.
ALLOCATION OF LIMITED INVESTMENT OPPORTUNITIES. If the portfolio managers
identify an investment opportunity that may be suitable for multiple accounts,
the Fund may not be able to take full advantage of that opportunity because the
opportunity may be allocated among all or many of these accounts or other
accounts managed primarily by other portfolio managers of the Adviser, and their
affiliates.
PURSUIT OF DIFFERING STRATEGIES. At times, the portfolio managers may determine
that an investment opportunity may be appropriate for only some of the accounts
for which they exercises investment responsibility, or may decide that certain
of these accounts should take differing positions with respect to a particular
security. In these cases, the portfolio managers may execute differing or
opposite transactions for one or more accounts which may affect the market price
of the security or the execution of the transaction, or both, to the detriment
of one or more of their accounts.
VARIATION IN COMPENSATION. A conflict of interest may arise where the financial
or other benefits available to the portfolio manager differ among the accounts
that they manage. If the structure of the Adviser's management fee or the
portfolio manager's compensation differs among accounts (such as where certain
accounts pay higher management fees or performance-based management fees), the
portfolio managers may be motivated to favor certain accounts over others. The
portfolio managers also may be motivated to favor accounts in which they have an
investment interest, or in which the Adviser, or its affiliates have investment
interests. In Mr. Gabelli's case, the Adviser's compensation and expenses for
the Fund are marginally greater as a percentage of assets than for certain other
accounts and are less than for certain other accounts managed by Mr. Gabelli,
while his personal compensation structure varies with near-term performance to a
greater degree in certain performance fee based accounts than with
on-performance based accounts. In addition, he has investment interests in
several of the funds managed by the Adviser and its affiliates.
The Adviser, and the Funds have adopted compliance policies and procedures that
are designed to address the various conflicts of interest that may arise for the
Adviser and their staff members. However, there is no guarantee that such
policies and procedures will be able to detect and prevent every situation in
which an actual or potential conflict may arise.
COMPENSATION STRUCTURE FOR MARIO J. GABELLI
Mr. Gabelli receives incentive-based variable compensation based on a percentage
of net revenues received by the Adviser for managing the Trust. Net revenues are
determined by deducting from gross investment management fees the firm's
expenses (other than Mr. Gabelli's compensation) allocable to this Trust. Five
closed-end registered investment companies (including this Trust) managed by Mr.
Gabelli have arrangements whereby the Adviser will only receive its investment
advisory fee attributable to the liquidation value of outstanding preferred
stock (and Mr. Gabelli would only receive his percentage of such advisory fee)
if certain performance levels are met. Additionally, he receives similar
incentive based variable compensation for managing other accounts within the
firm and its affiliates. This method of compensation is based on the premise
that superior long-term performance in managing a portfolio should be rewarded
with higher compensation as a result of growth of assets through appreciation
and net investment activity. The level of compensation is not determined with
specific reference to the performance of any account against any specific
benchmark. One of the other registered investment companies managed by Mr.
Gabelli has a performance (fulcrum) fee arrangement for which his compensation
is adjusted up or down based on the performance of the investment company
relative to an index. Mr. Gabelli manages other accounts with performance fees.
Compensation for managing these accounts has two components. One component is
based on a percentage of net revenues to the investment adviser for managing the
account. The second component is based on absolute performance of the account,
with respect to which a percentage of such performance fee is paid to Mr.
Gabelli. As an executive officer of the Adviser's parent company, GBL, Mr.
Gabelli also receives ten percent of the net operating profits of the parent
company. He receives no base salary, no annual bonus, and no stock options.
COMPENSATION STRUCTURE FOR PORTFOLIO MANAGERS OF THE ADVISER OTHER THAN MARIO
GABELLI
The compensation of the Portfolio Managers for the Fund is structure to enable
the Adviser to attract and retain highly qualified professionals in a
competitive environment. The Portfolio Managers receive a compensation package
that includes a minimum draw or base salary, equity-based incentive compensation
via awards of stock options, and incentive-based variable compensation based on
a percentage of net revenue received by the Adviser for managing a Fund to the
extent that the amount exceeds a minimum level of compensation. Net revenues are
determined by deducting from gross investment management fees certain of the
firm's expenses (other than the respective Portfolio Manager's compensation)
allocable to the respective Fund (the incentive-based variable compensation for
managing other accounts is also based on a percentage of net revenues to the
investment adviser for managing the account). This method of compensation is
based on the premise that superior long-term performance in managing a portfolio
should be rewarded with higher compensation as a result of growth of assets
through appreciation and net investment activity. The level of equity-based
incentive and incentive-based variable compensation is based on an evaluation by
the Adviser's parent, GBL, of quantitative and qualitative performance
evaluation criteria. This evaluation takes into account, in a broad sense, the
performance of the accounts managed by the Portfolio Manager, but the level of
compensation is not determined with specific reference to the performance of any
account against any specific benchmark. Generally, greater consideration is
given to the performance of larger accounts and to longer term performance over
smaller accounts and short-term performance.
OWNERSHIP OF SHARES IN THE FUND
Mario Gabelli and Lawrence J. Haverty, Jr. owned over $1,000,000 and $100,001 -
$500,000, respectively, of shares of the Trust as of December 31, 2007.
(B) Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
REGISTRANT PURCHASES OF EQUITY SECURITIES
============= ========================= ========================== ========================== ===============================
(C) TOTAL NUMBER OF (D) MAXIMUM NUMBER (OR
SHARES (OR UNITS) APPROXIMATE DOLLAR VALUE) OF
(A) TOTAL NUMBER OF PURCHASED AS PART OF SHARES (OR UNITS) THAT MAY
SHARES (OR UNITS) (B) AVERAGE PRICE PAID PER PUBLICLY ANNOUNCED PLANS YET BE PURCHASED UNDER THE
PERIOD PURCHASED SHARE (OR UNIT) OR PROGRAMS PLANS OR PROGRAMS
============= ========================= ========================== ========================== ===============================
Month #1 Common - N/A Common - N/A Common - N/A Common - 14,006,353
07/01/07
through Preferred Series B - N/A Preferred Series B - N/A Preferred Series B - N/A Preferred Series B - 993,100
07/31/07
============= ========================= ========================== ========================== ===============================
Month #2 Common - N/A Common - N/A Common - N/A Common - 14,006,353
08/01/07
through Preferred Series B - N/A Preferred Series B - N/A Preferred Series B - N/A Preferred Series B - 993,100
08/31/07
============= ========================= ========================== ========================== ===============================
Month #3 Common - N/A Common - N/A Common - N/A Common - 14,006,353
09/01/07
through Preferred Series B - N/A Preferred Series B - N/A Preferred Series B - N/A Preferred Series B - 993,100
09/30/07
============= ========================= ========================== ========================== ===============================
Month #4 Common - 5,000 Common - $14.2728 Common - 5,000 Common - 14,006,353 - 5,000
10/01/07 = 14,001,353
through Preferred Series B - N/A Preferred Series B - N/A Preferred Series B - N/A
10/31/07 Preferred Series B - 993,100
============= ========================= ========================== ========================== ===============================
Month #5 Common - N/A Common - N/A Common - N/A Common - 14,001,353
11/01/07
through Preferred Series B - N/A Preferred Series B - N/A Preferred Series B - N/A Preferred Series B - 993,100
11/30/07
============= ========================= ========================== ========================== ===============================
Month #6 Common - N/A Common - N/A Common - N/A Common - 14,001,353
12/01/07
through Preferred Series B - N/A Preferred Series B - N/A Preferred Series B - N/A Preferred Series B - 993,100
12/31/07
============= ========================= ========================== ========================== ===============================
Total Common - 5,000 Common - $14.2728 Common - 5,000 N/A
Preferred Series B - N/A Preferred Series B - N/A Preferred Series B - N/A
============= ========================= ========================== ========================== ===============================
Footnote columns (c) and (d) of the table, by disclosing the following
information in the aggregate for all plans or programs publicly announced:
a. The date each plan or program was announced - The notice of the potential
repurchase of common and preferred shares occurs quarterly in the Fund's
quarterly report in accordance with Section 23(c) of the Investment Company
Act of 1940, as amended.
b. The dollar amount (or share or unit amount) approved - Any or all common
shares outstanding may be repurchased when the Fund's common shares are
trading at a discount of 10% or more from the net asset value of the
shares. Any or all preferred shares outstanding may be repurchased when the
Fund's preferred shares are trading at a discount to the liquidation value
of $25.00.
c. The expiration date (if any) of each plan or program - The Fund's
repurchase plans are ongoing.
d. Each plan or program that has expired during the period covered by the
table - The Fund's repurchase plans are ongoing.
e. Each plan or program the registrant has determined to terminate prior to
expiration, or under which the registrant does not intend to make further
purchases. - The Fund's repurchase plans are ongoing.
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) Code of ethics, or any amendment thereto, that is the subject of
disclosure required by Item 2 is attached hereto.
(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 Global Multimedia Trust Inc.
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By (Signature and Title)* /s/ Bruce N. Alpert
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Bruce N. Alpert, Principal Executive Officer
Date 03/07/08
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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
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Bruce N. Alpert, Principal Executive Officer
Date 03/07/08
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By (Signature and Title)* /s/ Agnes Mullady
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Agnes Mullady,
Principal Financial Officer and Treasurer
Date 03/07/08
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* Print the name and title of each signing officer under his or her signature.