UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM N-Q
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QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANY
INVESTMENT COMPANY ACT FILE NUMBER 811-8747
CHARTWELL DIVIDEND AND INCOME FUND, INC.
(Exact name of registrant as specified in charter)
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1235 Westlakes Drive, Suite 400
Berwyn, PA 19312
(Address of principal executive offices) (Zip code)
PNC Bank, National Association
400 Bellevue Parkway
Wilmington, DE 19809
Attn: Closed-End Department
(Name and address of agent for service)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: 1-610-296-1400
DATE OF FISCAL YEAR END: NOVEMBER 30, 2005
DATE OF REPORTING PERIOD: FEBRUARY 28, 2005
ITEM 1. SCHEDULE OF INVESTMENTS
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CHARTWELL DIVIDEND AND INCOME FUND, INC. FEBRUARY 28, 2005
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SCHEDULE OF INVESTMENTS (Unaudited)
NUMBER OF MARKET
SHARES VALUE
-------------- --------------
COMMON STOCK--76.9%
BANKS--14.6%
AmSouth Bancorporation........................................................ 50,760 $ 1,267,985
Bank of America Corporation................................................... 212,000 9,889,800
Bank of New York Company, Inc................................................. 70,000 2,117,500
Citigroup, Inc................................................................ 100,000 4,772,000
New York Community Bancorp, Inc............................................... 50,000 918,000
U.S. Bancorp.................................................................. 100,000 2,975,000
------------
21,940,285
------------
BASIC INDUSTRY--4.9%
Alcoa, Inc.................................................................... 45,000 1,445,400
Dow Chemical Company.......................................................... 30,000 1,654,500
K-Sea Transportation Partners LP.............................................. 10,000 362,400
Packaging Corporation of America.............................................. 50,000 1,226,000
Weyerhaeuser Company.......................................................... 40,000 2,677,200
------------
7,365,500
------------
CONSUMER CYCLICAL--2.1%
Coinmach Corporation(a)....................................................... 245,000 3,231,550
------------
CONSUMER STAPLES--9.2%
Altria Group, Inc............................................................. 136,950 8,990,767
B&G Foods, Inc.(a)............................................................ 34,300 511,070
Loews Corporation - Carolina Group............................................ 128,225 4,198,087
------------
13,699,924
------------
ENERGY--8.4%
Halliburton Company........................................................... 112,800 4,959,816
Kerr-McGee Corporation........................................................ 25,000 1,941,500
Occidental Petroleum Corporation.............................................. 50,000 3,513,500
Schlumberger Limited.......................................................... 30,000 2,263,500
------------
12,678,316
------------
FINANCIAL--12.5%
Alliance Capital Management Holdings LP....................................... 100,000 4,703,000
Fannie Mae.................................................................... 25,300 1,479,038
Friedman Billings Ramsey Group, Inc........................................... 150,000 2,782,500
Hartford Financial Services Group, Inc........................................ 39,200 2,820,440
New Century Financial Corporation............................................. 60,000 3,043,200
People's Choice Europe Limited................................................ 35,000 350,000
Washington Mutual, Inc........................................................ 87,700 3,679,892
------------
18,858,070
------------
HEALTHCARE--0.2%
Pfizer Inc.................................................................... 10,000 262,900
------------
INDUSTRIAL--3.0%
Arlington Tankers Limited(a).................................................. 42,100 1,035,660
General Electric Company...................................................... 100,000 3,520,000
------------
4,555,660
------------
REAL ESTATE--9.5%
Bimini Mortgage Management, Inc............................................... 8,000 120,800
Boston Properties, Inc........................................................ 30,000 1,794,000
BRE Properties, Class A....................................................... 19,500 764,400
CarrAmerica Realty Corporation................................................ 32,600 1,018,750
1
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CHARTWELL
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CHARTWELL DIVIDEND AND INCOME FUND, INC. FEBRUARY 28, 2005
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SCHEDULE OF INVESTMENTS (Unaudited)
NUMBER OF
SHARES/
PRINCIPAL MARKET
AMOUNT VALUE
-------------- --------------
COMMON STOCK (CONTINUED)
REAL ESTATE (CONTINUED)
Duke Realty Corporation....................................................... 80,320 $ 2,544,538
HomeBanc Corporation.......................................................... 225,000 2,175,750
iStar Financial, Inc.......................................................... 50,000 2,124,500
Mack-Cali Realty Corporation.................................................. 27,682 1,223,544
Reckson Associates Realty Corporation......................................... 80,000 2,444,000
------------
14,210,282
------------
TECHNOLOGY--1.0%
Microsoft Corporation......................................................... 40,000 1,007,200
Solectron Corporation......................................................... 100,000 495,000
------------
1,502,200
------------
TELECOMMUNICATIONS--7.5%
Alaska Communications Systems Group, Inc...................................... 175,000 1,503,250
BellSouth Corporation......................................................... 100,000 2,580,000
Citizens Communications Company............................................... 350,000 4,669,000
Fairpoint Communications, Inc................................................. 75,000 1,305,000
SBC Communications, Inc....................................................... 50,000 1,202,500
------------
11,259,750
------------
UTILITIES--4.0%
AmeriGas Partners LP.......................................................... 15,200 445,968
Duquesne Light Holdings, Inc.................................................. 30,000 561,900
Kinder Morgan Energy Partners LP.............................................. 45,000 2,114,550
Northern Border Partners LP................................................... 26,600 1,359,260
TEPPCO Partners LP............................................................ 34,800 1,525,632
------------
6,007,310
------------
TOTAL COMMON STOCK (COST $102,020,683) ....................................... 115,571,747
------------
CORPORATE NOTES/BONDS--49.9%
BASIC INDUSTRY--12.8%
Aearo Company I
8.250%, 04/15/12............................................................ $ 755,000 796,525
Ainsworth Lumber Company Limited+
7.250%, 10/01/12............................................................ 775,000 798,250
BCP Caylux Holdings Luxembourg+
9.625%, 06/15/14............................................................ 850,000 988,275
Buhrmann US, Inc.
8.250%, 07/01/14............................................................ 850,000 886,125
Danka Business Systems
11.000%, 06/15/10........................................................... 920,000 917,700
Euramax International, Inc.
8.500%, 08/15/11............................................................ 1,645,000 1,772,487
Goodman Global Holdings Company, Inc.+
7.875%, 12/15/12............................................................ 600,000 589,500
Imco Recycling, Inc.
10.375%, 10/15/10........................................................... 855,000 970,425
Koppers Industries+
9.875%, 10/15/13............................................................ 1,230,000 1,408,350
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CHARTWELL
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CHARTWELL DIVIDEND AND INCOME FUND, INC. FEBRUARY 28, 2005
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SCHEDULE OF INVESTMENTS (Unaudited)
PRINCIPAL MARKET
AMOUNT VALUE
-------------- --------------
CORPORATE NOTES/BONDS (CONTINUED)
BASIC INDUSTRY (CONTINUED)
KRATON Polymers LLC+
8.125%, 01/15/14............................................................ $ 985,000 $ 1,004,700
Nalco Company
8.875%, 11/15/13............................................................ 1,090,000 1,209,900
Nortek, Inc.
8.500%, 09/01/14............................................................ 585,000 599,625
Ply Gem Industries, Inc.
9.000%, 02/15/12............................................................ 855,000 859,275
RH Donnelley Corporation+
6.875%, 01/15/13............................................................ 400,000 413,000
Ryerson Tull, Inc.+
8.250%, 12/15/11............................................................ 835,000 839,175
Sensus Metering Systems, Inc.
8.625%, 12/15/13............................................................ 700,000 726,250
United Agri Products+
8.250%, 12/15/11............................................................ 651,000 706,335
Universal City Florida Holdings Company, Inc.+
8.375%, 05/01/10............................................................ 755,000 798,412
Vertis, Inc., Series B
10.875%, 06/15/09........................................................... 1,555,000 1,578,325
Williams Scotsman, Inc.
9.875%, 06/01/07............................................................ 875,000 881,563
Wolverine Tube, Inc.
10.500%, 04/01/09........................................................... 500,000 535,000
------------
19,279,197
------------
CAPITAL GOODS--3.5%
Allied Waste North America, Series B
8.500%, 12/01/08............................................................ 935,000 1,009,800
GenCorp, Inc.
9.500%, 08/15/13............................................................ 451,000 498,355
H&E Equipment Finance
11.125%, 06/15/12........................................................... 970,000 1,071,850
Integrated Electrical Services, Inc., Series C
9.375%, 02/01/09............................................................ 300,000 275,250
K&F Acquisition, Inc.+
7.750%, 11/15/14............................................................ 680,000 691,900
Norcross Safety Products LLC, Series B
9.875%, 08/15/11............................................................ 1,070,000 1,182,350
Propex Fabrics, Inc.+
10.000%, 12/01/12........................................................... 600,000 609,000
------------
5,338,505
------------
CONSUMER CYCLICAL--5.4%
Allied Security Escrow Corporation
11.375%, 07/15/11........................................................... 1,020,000 1,072,275
Cenveo, Inc.
9.625%, 03/15/12............................................................ 1,455,000 1,607,775
Coinmach Corporation
9.000%, 02/01/10............................................................ 1,110,000 1,165,500
Denny's Corporation+
10.000%, 10/01/12........................................................... 600,000 655,500
LCE Acquisition Corporation+
9.000%, 08/01/14............................................................ 1,255,000 1,320,887
Mothers Work, Inc.
11.250%, 08/01/10........................................................... 935,000 944,350
Norcraft Companies
9.000%, 11/01/11............................................................ 570,000 615,600
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CHARTWELL
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CHARTWELL DIVIDEND AND INCOME FUND, INC. FEBRUARY 28, 2005
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SCHEDULE OF INVESTMENTS (Unaudited)
PRINCIPAL MARKET
AMOUNT VALUE
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CORPORATE NOTES/BONDS (CONTINUED)
CONSUMER CYCLICAL (CONTINUED)
Sonic Automotive, Inc., Series B
8.625%, 08/15/13............................................................ $ 635,000 $ 687,388
------------
8,069,275
------------
CONSUMER STAPLES--5.7%
American Achievement Corporation
8.250%, 04/01/12............................................................ 625,000 659,375
American Seafood Group LLC
10.125%, 04/15/10........................................................... 1,005,000 1,095,450
Amscan Holdings, Inc.
8.750%, 05/01/14............................................................ 595,000 593,512
Chiquita Brands International, Inc.+
7.500%, 11/01/14............................................................ 950,000 964,250
FTD, Inc.
7.750%, 02/15/14............................................................ 400,000 417,000
Gereral Nutrition Centers, Inc.
8.500%, 12/01/10............................................................ 945,000 805,613
Jean Coutu Group (PJC), Inc.+
8.500%, 08/01/14............................................................ 1,225,000 1,261,750
MTR Gaming Group, Inc.
9.750%, 04/01/10............................................................ 520,000 573,300
Solo Cup Company
8.500%, 02/15/14............................................................ 1,100,000 1,149,500
Stater Brothers Holdings
8.125%, 06/15/12............................................................ 715,000 747,175
WH Holdings Limited
9.500%, 04/01/11............................................................ 294,000 326,340
------------
8,593,265
------------
ENERGY--1.8%
Belden & Blake Corporation
8.750%, 07/15/12............................................................ 1,490,000 1,523,525
Bluewater Finance Limited
10.250%, 02/15/12........................................................... 1,000,000 1,110,000
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2,633,525
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FINANCIAL--3.4%
E*TRADE Financial Corporation
8.000%, 06/15/11............................................................ 870,000 943,950
Labranche & Company, Inc.(b)
11.000%, 05/15/12........................................................... 1,580,000 1,710,350
United Rentals North America, Inc.
7.750%, 11/15/13............................................................ 1,200,000 1,209,000
Western Financial
9.625%, 05/15/12............................................................ 1,120,000 1,271,200
------------
5,134,500
------------
HEALTHCARE--2.2%
Iasis Healthcare Corporation
8.750%, 06/15/14............................................................ 1,005,000 1,097,962
Town Sports International
9.625%, 04/15/11............................................................ 1,100,000 1,171,500
VWR International, Inc.
8.000%, 04/15/14............................................................ 1,010,000 1,055,450
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3,324,912
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4
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CHARTWELL
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CHARTWELL DIVIDEND AND INCOME FUND, INC. FEBRUARY 28, 2005
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SCHEDULE OF INVESTMENTS (Unaudited)
PRINCIPAL MARKET
AMOUNT VALUE
-------------- --------------
CORPORATE NOTES/BONDS (CONTINUED)
INDUSTRIAL--5.7%
Autocam Corporation
10.875%, 06/15/14........................................................... $ 600,000 $ 579,000
Douglas Dynamics, LLC+
7.750%, 01/15/12............................................................ 610,000 622,200
General Cable Corporation
9.500%, 11/15/10............................................................ 420,000 474,600
HLI Operating Company, Inc.
10.500%, 06/15/10........................................................... 230,000 238,050
INVISTA+
9.250%, 05/01/12............................................................ 1,690,000 1,905,475
MediaCom Broadband, LLC
11.000%, 07/15/13........................................................... 1,775,000 1,972,469
Rayovac Corporation
8.500%, 10/01/13............................................................ 395,000 434,006
Superior Essex Communications LLC
9.000%, 04/15/12............................................................ 900,000 963,000
Tenneco Automotive, Inc.+
8.625%, 11/15/14............................................................ 1,265,000 1,353,550
------------
8,542,350
------------
REAL ESTATE--2.4%
Geo Group, Inc.
8.250%, 07/15/13............................................................ 1,120,000 1,184,400
Intrawest Corporation
7.500%, 10/15/13............................................................ 890,000 948,963
Tech Olympic USA, Inc.
9.000%, 07/01/10............................................................ 1,320,000 1,435,500
------------
3,568,863
------------
TELECOMMUNICATIONS--4.5%
Albritton Communications Company
7.750%, 12/15/12............................................................ 990,000 1,037,025
Cablevision Systems Corporation+
8.000%, 04/15/12............................................................ 445,000 502,850
Centennial Cellular Operating Company
10.125%, 06/15/13........................................................... 1,110,000 1,293,150
Charter Communications Holdings, LLC
10.750%, 10/01/09........................................................... 400,000 347,000
Charter Communications Operating, LLC+
8.000%, 04/30/12............................................................ 425,000 436,688
Cincinnati Bell, Inc.(b)
8.375%, 01/15/14............................................................ 875,000 908,906
Cincinnati Bell, Inc.+
8.375%, 01/15/14............................................................ 15,000 15,581
Intelsat Bermuda Limited
7.794%, 01/15/12............................................................ 630,000 650,475
Time Warner, Inc.
9.750%, 07/15/08............................................................ 655,000 673,013
UbiquiTel Operating Company+
9.875%, 03/01/11............................................................ 310,000 351,850
UbiquiTel Operating Company
9.875%, 03/01/11............................................................ 550,000 624,250
------------
6,840,788
------------
TRANSPORTATION--1.3%
Continental Airlines, Inc.
8.000%, 12/15/05............................................................ 470,000 461,775
5
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CHARTWELL
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CHARTWELL DIVIDEND AND INCOME FUND, INC. FEBRUARY 28, 2005
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SCHEDULE OF INVESTMENTS (Unaudited)
PRINCIPAL
AMOUNT/
NUMBER OF MARKET
SHARES VALUE
-------------- --------------
CORPORATE NOTES/BONDS (CONTINUED)
TRANSPORTATION (CONTINUED)
Ship Finance International Limited
8.500%, 12/15/13............................................................ $1,525,000 $ 1,547,875
------------
2,009,650
------------
UTILITIES--1.2%
AES Corporation
9.500%, 06/01/09............................................................ 900,000 1,041,750
CE Generation, LLC
7.416%, 12/15/18............................................................ 684,028 721,320
------------
1,763,070
------------
TOTAL CORPORATE NOTES/BONDS (COST $72,920,931) ............................... 75,097,900
------------
CONVERTIBLE PREFERRED STOCK--2.5%
FINANCIAL--1.0%
ACE Limited................................................................... 26,025 696,429
Chubb Corporation............................................................. 10,000 297,900
Hartford Financial Services Group, Inc........................................ 5,000 335,350
XL Capital Limited............................................................ 10,000 244,400
------------
1,574,079
------------
REAL ESTATE--1.5%
LTC Properties, Inc........................................................... 25,000 912,500
Ramco-Gershenson Properties................................................... 40,000 1,289,200
------------
2,201,700
------------
TOTAL CONVERTIBLE PREFERRED STOCK (COST $3,171,097) .......................... 3,775,779
------------
PREFERRED STOCK--0.3%
FINANCIAL--0.3%
TransCanada Corporation....................................................... 14,905 384,549
------------
TOTAL PREFERRED STOCK (COST $381,501) ........................................ 384,549
------------
PREFERRED TERM SECURITIES (C)--5.8%
I-Preferred Term Securities IV................................................ 1,000,000 1,000,000
Preferred Term Securities IV.................................................. 2,000,000 1,420,500
Preferred Term Securities XIII................................................ 1,000,000 1,037,500
Preferred Term Securities XIV................................................. 2,000,000 2,080,000
Preferred Term Securities XV.................................................. 2,000,000 2,080,000
Preferred Term Securities XVI................................................. 1,000,000 1,030,000
------------
TOTAL PREFERRED TERM SECURITIES (COST $8,195,706) ............................ 8,648,000
------------
TOTAL INVESTMENTS--135.4%
(COST $186,689,918)* ....................................................... 203,477,975
------------
6
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CHARTWELL
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CHARTWELL DIVIDEND AND INCOME FUND, INC. FEBRUARY 28, 2005
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SCHEDULE OF INVESTMENTS (Unaudited)
WRITTEN MARKET
CONTRACTS VALUE
-------------- --------------
COVERED CALL OPTIONS WRITTEN--(0.3)%
Altria Group, Inc. Mar. 70 Call............................................... (600 $ (3,000)
Dow Chemical Company Mar. 55 Call............................................. (300) (31,500)
Friedman Billings Ramsey Group, Inc. Mar. 20 Call............................. (500) (5,000)
Hartford Financial Sercvies Group, Inc. Mar. 75 Call.......................... (390) (6,825)
Microsoft Corporation Marc. 27.5 Call......................................... (400) --
Occidental Petroleum Corporation Mar. 70 Call................................. (500) (107,500)
Schlumberger Limited Mar. 70 Call............................................. (200) (94,000)
Schlumberger Limited Mar. 75 Call............................................. (100) (18,500)
U.S. Bancorp Mar. 30 Call..................................................... (1,000) (30,000)
Weyerhaeuser Company Mar. 65 Call............................................. (400) (100,000)
------------
TOTAL COVERED CALL OPTIONS WRITTEN (PREMIUM RECEIVED $286,750) ............... (396,325)
------------
OTHER LIABILITIES IN EXCESS OF OTHER ASSETS--(35.1)% ......................... (52,809,718)++
------------
NET ASSETS--100% ............................................................. $150,271,932
============
* At February 28, 2005, the tax basis cost of the Fund's investments
was $186,689,918, and the unrealized appreciation and depreciation
were $19,606,681 and $(2,818,624), respectively.
+ Security exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt
from registration normally to qualified institutions. At
February 28, 2005, these securities amounted to $18,237,478 or 12.1%
of net assets.
++ As of February 28, 2005, $55,000,000 of commercial paper was
outstanding with an amortized cost of $54,935,535. The average
discount rate of commercial paper outstanding at February
28, 2005 was 2.58%. The average daily balance of commercial paper
outstanding for the quarter ended February 28, 2005 was $54,832,197
at a weighted average discount rate of 1.552%. The maximum face
amount of commercial paper outstanding at any time during the
quarter ended February 28, 2005 was $55,000,000. In conjunction
with the issuance of the commercial paper, the Fund has entered into
a line of credit arrangement with a bank for $30,000,000. Interest
on borrowing is based on market rates in effect at the time of
borrowing. The commitment fee is computed at the rate of 0.30% per
annum on the unused balance. There were no borrowings under this
arrangement during the quarter ended February 28, 2005.
(a) Non-income producing security.
(b) Security purchased on a when-issued basis.
(c) Securities are illiquid.
LLC Limited Liability Company
LP Limited Partnership
Amounts designated as "--" are either $0 or have been rounded to $0
For information regarding the Fund's policy regarding valuation of
investments and other significant accounting policies, please refer
to the Fund's most recent semi-annual or annual financial
statements.
7
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CHARTWELL
ITEM 2. CONTROLS AND PROCEDURES
(a) The certifying officers, whose certifications are included herewith, have
evaluated the registrant's disclosure controls and procedures within 90 days of
the filing date of this report. In their opinion, based on their evaluation, the
registrant's disclosure controls and procedures are adequately designed, and are
operating effectively to ensure, that information required to be disclosed by
the registrant in the reports it files or submits under the Securities Exchange
Act of 1934 is recorded, processed, summarized and reported within the time
periods specified in the Securities and Exchange Commission's rules and forms.
(b) There were no significant changes in the registrant's internal control over
financial reporting that occurred during the registrant's last fiscal quarter
that has materially affected, or is reasonably likely to materially affect, the
registrants internal control over financial reporting.
ITEM 3. EXHIBITS.
(a) A separate certification for the principal executive officer and the
principal financial officer of the registrant as required by Rule 30a-2(a) under
the Investment Company Act of 1940, as amended (17 CFR 270.30a-2(a)), are filed
herewith.
--------------------------------------------------------------------------------
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) Chartwell Dividend and Income Fund, Inc.
By (Signature and Title)* /s/ Winthrop S. Jessup
----------------------------------------
Winthrop S. Jessup, President
(Principal Executive Officer)
Date: April 29, 2005
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/ Winthrop S. Jessup
----------------------------------------
Winthrop S. Jessup, President
(Principal Executive Officer)
Date: April 29, 2005
By (Signature and Title)* /s/ G. Gregory Hagar
----------------------------------------
G. Gregory Hagar, Vice President and CFO
(Principal Financial Officer)
Date: April 29, 2005
* Print the name and title of each signing officer under his or her signature.