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
DATE OF REPORTING PERIOD: AUGUST 31, 2005
ITEM 1. SCHEDULE OF INVESTMENTS
CHARTWELL DIVIDEND AND INCOME FUND INC. AUGUST 31, 2005
SCHEDULE OF INVESTMENTS (Unaudited)
NUMBER OF MARKET
SHARES VALUE
-------------- --------------
COMMON STOCK--74.4%
BANKS--12.6%
AmSouth Bancorporation........................................................ 46,760 $ 1,230,723
Bank of America Corporation................................................... 242,000 10,413,260
Citigroup, Inc................................................................ 50,000 2,188,500
New York Community Bancorp, Inc............................................... 100,000 1,758,000
U.S. Bancorp.................................................................. 100,000 2,922,000
--------------
18,512,483
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BASIC INDUSTRY--3.1%
Dow Chemical Company.......................................................... 30,000 1,296,000
Packaging Corporation of America.............................................. 50,000 1,048,000
Reddy Ice Holdings, Inc....................................................... 59,280 1,285,783
Weyerhaeuser Company.......................................................... 12,900 838,758
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4,468,541
--------------
CONSUMER CYCLICAL--2.3%
Coinmach Corporation.......................................................... 245,000 3,354,050
--------------
CONSUMER STAPLES--11.6%
Altria Group, Inc............................................................. 132,950 9,399,565
B&G Foods, Inc................................................................ 34,300 444,185
Loews Corporation - Carolina Group............................................ 128,225 4,950,767
Regal Entertainment Group, Class A............................................ 110,000 2,150,500
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16,945,017
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ENERGY--9.5%
Baker Hughes, Inc............................................................. 30,000 1,762,500
Chevron Corporation........................................................... 30,000 1,842,000
ConocoPhillips................................................................ 75,000 4,945,500
Exxon Mobil Corporation....................................................... 20,000 1,198,000
Halliburton Company........................................................... 800 49,576
Schlumberger Limited.......................................................... 30,000 2,586,900
Sunoco Logistics Partners LP.................................................. 40,000 1,554,400
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13,938,876
--------------
FINANCIAL--8.9%
Alliance Capital Management Holdings LP....................................... 100,000 4,422,000
Hartford Financial Services Group, Inc........................................ 39,200 2,863,560
Montpelier Re Holdings Limited................................................ 80,000 2,616,000
People's Choice Europe Limited+............................................... 35,000 341,250
Washington Mutual, Inc........................................................ 67,700 2,814,966
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13,057,776
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INDUSTRIAL--1.4%
Arlington Tankers Limited..................................................... 42,100 947,671
Teekay LNG Partners LP........................................................ 35,000 1,114,750
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2,062,421
--------------
REAL ESTATE--11.6%
Boston Properties, Inc........................................................ 30,000 2,134,500
BRE Properties, Class A....................................................... 19,500 807,300
CarrAmerica Realty Corporation................................................ 32,600 1,176,534
Deerfield Triarc Capital Corporation.......................................... 50,000 705,500
Duke Realty Corporation....................................................... 80,320 2,629,677
HomeBanc Corporation.......................................................... 225,000 1,793,250
1
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CHARTWELL
CHARTWELL DIVIDEND AND INCOME FUND INC. AUGUST 31, 2005
SCHEDULE OF INVESTMENTS (Unaudited)
NUMBER OF
SHARES/PRINCIPAL MARKET
AMOUNT VALUE
-------------- --------------
COMMON STOCK (CONTINUED)
REAL ESTATE (CONTINUED)
iStar Financial, Inc.......................................................... 50,000 $ 2,073,500
Mack-Cali Realty Corporation.................................................. 27,682 1,219,392
New Century Financial Corporation............................................. 40,000 1,719,600
Reckson Associates Realty Corporation......................................... 80,000 2,652,000
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16,911,253
--------------
TELECOMMUNICATIONS--7.6%
Alaska Communications Systems Group, Inc...................................... 175,000 1,895,250
BellSouth Corporation......................................................... 100,000 2,629,000
Citizens Communications Company............................................... 350,000 4,774,000
Consolidated Communications Holdings, Inc..................................... 50,000 690,000
Fairpoint Communications, Inc................................................. 75,000 1,205,250
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11,193,500
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TRANSPORTATION--1.7%
Aries Maritime Transport Limited.............................................. 50,000 759,100
K-Sea Transportation Partners LP.............................................. 10,000 400,500
Seaspan Corporation........................................................... 43,400 910,966
Transmontaigne Partners LP.................................................... 15,000 388,500
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2,459,066
--------------
UTILITIES--4.1%
AmeriGas Partners LP.......................................................... 15,200 500,688
Duquesne Light Holdings, Inc.................................................. 30,000 544,500
Kinder Morgan Energy Partners LP.............................................. 45,000 2,299,950
Northern Border Partners LP................................................... 26,600 1,272,810
TEPPCO Partners LP............................................................ 34,800 1,439,328
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6,057,276
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TOTAL COMMON STOCK (COST $96,339,124)......................................... 108,960,259
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CORPORATE NOTES/BONDS--48.0%
BASIC INDUSTRY--8.5%
Buhrmann US, Inc.
8.250%, 07/01/14............................................................ $ 850,000 877,625
Commercial Vehicle Group+
8.000%, 07/01/13............................................................ 755,000 788,975
Domtar, Inc.
7.125%, 08/15/15............................................................ 500,000 500,992
Georgia-Pacific Corporation
7.700%, 06/15/15............................................................ 500,000 568,750
Goodman Global Holdings Company, Inc.+
7.875%, 12/15/12............................................................ 1,100,000 1,045,000
K. Hovnanian Enterprises
6.500%, 01/15/14............................................................ 500,000 499,684
Koppers Industries
9.875%, 10/15/13............................................................ 1,560,000 1,739,400
Lamar Media Corporation+
6.625%, 08/15/15............................................................ 900,000 922,500
Nortek, Inc.
8.500%, 09/01/14............................................................ 1,085,000 1,060,588
2
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CHARTWELL
CHARTWELL DIVIDEND AND INCOME FUND INC. AUGUST 31, 2005
SCHEDULE OF INVESTMENTS (Unaudited)
PRINCIPAL MARKET
AMOUNT VALUE
-------------- --------------
CORPORATE NOTES/BONDS (CONTINUED)
BASIC INDUSTRY (CONTINUED)
Ply Gem Industries, Inc.
9.000%, 02/15/12............................................................ $ 855,000 $ 769,500
Sensus Metering Systems, Inc.
8.625%, 12/15/13............................................................ 700,000 659,750
Tenneco Automotive, Inc.
8.625%, 11/15/14............................................................ 800,000 834,000
United Agri Products
8.250%, 12/15/11............................................................ 651,000 693,315
Vertis, Inc., Series B
10.875%, 06/15/09........................................................... 500,000 513,750
Williams Scotsman, Inc.
9.875%, 06/01/07............................................................ 875,000 879,375
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12,353,204
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CAPITAL GOODS--2.5%
Allied Waste North America, Series B
8.500%, 12/01/08............................................................ 935,000 993,438
H&E Equipment Finance
11.125%, 06/15/12........................................................... 970,000 1,088,825
Norcross Safety Products LLC, Series B
9.875%, 08/15/11............................................................ 850,000 907,375
Propex Frabics, Inc.
10.000%, 12/01/12........................................................... 600,000 582,000
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3,571,638
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CONSUMER CYCLICAL--4.2%
Allied Security Escrow
11.375%, 07/15/11........................................................... 1,020,000 1,017,450
Cenveo, Inc.
9.625%, 03/15/12............................................................ 1,200,000 1,290,000
Coinmach Corporation
9.000%, 02/01/10............................................................ 1,110,000 1,154,400
LCE Acquisition Corporation+
9.000%, 08/01/14............................................................ 1,255,000 1,239,313
Norcraft Companies
9.000%, 11/01/11............................................................ 570,000 601,350
Sonic Automotive, Inc., Series B
8.625%, 08/15/13............................................................ 865,000 895,275
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6,197,788
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CONSUMER STAPLES--5.7%
American Seafood Group LLC
10.125%, 04/15/10........................................................... 1,005,000 1,077,863
Brown Shoe Company, Inc.
8.750%, 05/01/12............................................................ 800,000 858,000
Chiquita Brands International, Inc.
7.500%, 11/01/14............................................................ 950,000 916,750
Jean Countu Group (PJC), Inc.
8.500%, 08/01/14............................................................ 1,225,000 1,261,750
MTR Gaming Group, Inc., Series B
9.750%, 04/01/10............................................................ 520,000 567,450
Solo Cup Company
8.500%, 02/15/14............................................................ 1,100,000 1,075,250
Starwood Hotels & Resorts
7.375%, 11/15/15............................................................ 960,000 1,056,000
Stater Brothers Holdings
8.125%, 06/15/12............................................................ 715,000 729,300
3
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CHARTWELL
CHARTWELL DIVIDEND AND INCOME FUND INC. AUGUST 31, 2005
SCHEDULE OF INVESTMENTS (Unaudited)
PRINCIPAL MARKET
AMOUNT VALUE
-------------- --------------
CORPORATE NOTES/BONDS (CONTINUED)
CONSUMER STAPLES (CONTINUED)
WH Holdings Limited
9.500%, 04/01/11............................................................ $ 294,000 $ 320,460
Wynn Las Vegas, LLC
6.625%, 12/01/14............................................................ 500,000 488,750
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8,351,573
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ENERGY--2.5%
Bluewater Finance Limited
10.250%, 02/15/12........................................................... 1,000,000 1,090,000
Chesepeake Energy Corporation+
6.250%, 01/15/18............................................................ 500,000 498,125
Kerr-McGee Corporation
7.000%, 11/01/11............................................................ 1,010,000 1,015,050
Reliant Energy, Inc.
6.750%, 12/15/14............................................................ 500,000 495,000
Whiting Petroleum Corporation
7.250%, 05/01/13............................................................ 600,000 606,000
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3,704,175
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FINANCIAL--2.4%
E*Trade Financial Corporation
8.000%, 06/15/11............................................................ 870,000 926,550
Labranche & Company, Inc.
11.000%, 05/15/12........................................................... 1,160,000 1,287,600
Western Financial
9.625%, 05/15/12............................................................ 1,120,000 1,271,200
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3,485,350
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HEALTHCARE--2.5%
HCA, Inc.
5.750%, 03/15/14............................................................ 910,000 903,873
Iasis Healthcare Corporation
8.750%, 06/15/14............................................................ 1,005,000 1,087,912
Mylan Laboratories, Inc.+
6.375%, 08/15/15............................................................ 500,000 503,125
Town Sports International
9.625%, 04/15/11............................................................ 1,100,000 1,171,500
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3,666,410
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INDUSTRIAL--5.0%
Ainsworth Lumber
7.250%, 10/01/12............................................................ 665,000 625,100
Douglas Dynamics, LLC+
7.750%, 01/15/12............................................................ 610,000 619,150
Freeport-McMoRan Copper & Gold, Inc.
10.125%, 02/01/10........................................................... 1,010,000 1,116,050
General Cable Corporation
9.500%, 11/15/10............................................................ 420,000 447,300
INVISTA+
9.250%, 05/01/12............................................................ 1,690,000 1,867,450
L-3 Communications Corporation+
6.375%, 10/15/15............................................................ 500,000 510,000
Noble Group Limited+
6.625%, 03/17/15............................................................ 900,000 840,241
Rayovac Corporation
8.500%, 10/01/13............................................................ 395,000 408,825
4
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CHARTWELL
CHARTWELL DIVIDEND AND INCOME FUND INC. AUGUST 31, 2005
SCHEDULE OF INVESTMENTS (Unaudited)
PRINCIPAL MARKET
AMOUNT VALUE
-------------- --------------
CORPORATE NOTES/BONDS (CONTINUED)
INDUSTRIAL (CONTINUED)
Superior Essex Communications, LLC
9.000%, 04/15/12............................................................ $ 900,000 $ 918,000
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7,352,116
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REAL ESTATE--4.0%
Aztar Corporation
7.875%, 06/15/14............................................................ 880,000 937,200
Geo Group, Inc.
8.250%, 07/15/13............................................................ 1,120,000 1,106,000
Intrawest Corporation
7.500%, 10/15/13............................................................ 890,000 923,375
La Quinta Properties
8.875%, 03/15/11............................................................ 1,430,000 1,547,975
Tech Olympic USA, Inc.
9.000%, 07/01/10............................................................ 1,320,000 1,381,050
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5,895,600
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TELECOMMUNICATIONS--7.0%
Albritton Communications Company
7.750%, 12/15/12............................................................ 990,000 1,001,137
Cablevision Systems Corporation
8.000%, 04/15/12............................................................ 670,000 669,162
Charter Communications Operating, LLC+
8.000%, 04/30/12............................................................ 900,000 915,750
Cincinnati Bell, Inc.
8.375%, 01/15/14............................................................ 875,000 888,125
Cincinnati Bell, Inc.+
8.375%, 01/15/14............................................................ 515,000 522,725
Directv Holdings/Finance+
6.375%, 06/15/15............................................................ 845,000 847,113
Echostar DBS Corporation
6.625%, 10/01/14............................................................ 500,000 498,125
Intelsat Bermuda Limited+
8.695%, 01/15/12............................................................ 630,000 644,175
MediaCom Broadband, LLC
11.000%, 07/15/13........................................................... 1,775,000 1,945,844
Qwest Corporation+
7.625%, 06/15/15............................................................ 1,075,000 1,107,250
Time Warner, Inc.
9.750%, 07/15/08............................................................ 1,150,000 1,173,000
--------------
10,212,406
--------------
TRANSPORTATION--0.9%
Ship Finance International Limited
8.500%, 12/15/13............................................................ 1,365,000 1,325,756
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UTILITIES--2.8%
AES Corporation
9.500%, 06/01/09............................................................ 900,000 996,750
CE Generation, LLC
7.416%, 12/15/18............................................................ 668,395 730,512
CMS Energy Corporation
6.300%, 02/01/12............................................................ 1,035,000 1,060,875
MSW Energy Holdings
7.375%, 09/01/10............................................................ 130,000 135,850
Tenaska Alabama Part+
7.000%, 06/30/21............................................................ 600,000 628,914
5
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CHARTWELL
CHARTWELL DIVIDEND AND INCOME FUND INC. AUGUST 31, 2005
SCHEDULE OF INVESTMENTS (Unaudited)
PRINCIPAL
AMOUNT/NUMBER MARKET
OF SHARES VALUE
-------------- --------------
CORPORATE NOTES/BONDS (CONTINUED)
UTILITIES (CONTINUED)
TXU Corporation+
5.550%, 11/15/14............................................................ $ 500,000 $ 486,986
--------------
4,039,887
--------------
TOTAL CORPORATE NOTES/BONDS (COST $69,577,229)................................ 70,155,903
--------------
CONVERTIBLE PREFERRED STOCK--3.3%
CONSUMER STAPLES--0.8%
Albertson's, Inc.............................................................. 54,400 1,194,624
--------------
FINANCIAL--1.8%
ACE Limited................................................................... 26,025 694,607
Chubb Corporation............................................................. 10,000 316,800
Felcor Lodging Trust, Inc..................................................... 40,000 999,200
Hartford Financial Services Group, Inc........................................ 5,000 333,700
XL Capital Limited............................................................ 10,000 229,600
--------------
2,573,907
--------------
REAL ESTATE--0.7%
LTC Properties, Inc........................................................... 25,000 1,037,500
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TOTAL CONVERTIBLE PREFERRED STOCK (COST $4,269,583)........................... 4,806,031
--------------
PREFERRED STOCK--0.7%
FINANCIAL--0.7%
Metlife, Inc.................................................................. 25,000 690,250
TransCanada Corporation....................................................... 14,905 389,319
--------------
TOTAL PREFERRED STOCK (COST $1,006,501)....................................... 1,079,569
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PREFERRED TERM SECURITIES (A)--7.4%
I-Preferred Term Securities IV................................................ 10,000 1,051,250
Preferred Term Securities IV.................................................. 20,000 1,282,500
Preferred Term Securities XIII................................................ 10,000 999,000
Preferred Term Securities XIV................................................. 20,000 1,971,000
Preferred Term Securities XV.................................................. 20,000 2,120,000
Preferred Term Securities XVI................................................. 10,000 1,080,000
Preferred Term Securities XVII................................................ 6,000 606,000
Preferred Term Securities XVIII............................................... 10,000 985,500
Taberna Preferred Funding I+.................................................. 2,500 250,000
Taberna Preferred Funding II+................................................. 5 500,000
--------------
TOTAL PREFERRED TERM SECURITIES (COST $10,137,277)............................ 10,845,250
--------------
CASH EQUIVALENTS--3.8%
SEI Daily Income Trust, Prime Obligations Fund, Class A....................... 1,386,312 1,386,312
SEI Daily Income Trust, Treasury Fund......................................... 4,174,687 4,174,687
--------------
TOTAL CASH EQUIVALENTS (COST $5,560,999)...................................... 5,560,999
--------------
TOTAL INVESTMENTS--137.6%
(COST $186,890,713)*........................................................ 201,408,011
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6
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CHARTWELL
CHARTWELL DIVIDEND AND INCOME FUND INC. AUGUST 31, 2005
SCHEDULE OF INVESTMENTS (Unaudited)
WRITTEN MARKET
CONTRACTS VALUE
-------------- --------------
COVERED CALL OPTIONS WRITTEN--(0.3)%
Altria Group, Inc. Oct. 75 Call............................................... (200)$ (18,000)
Baker Hughes, Inc. Sept. 60 Call.............................................. (200) (13,000)
BellSouth Corporation Sept. 27.5 Call......................................... (1,000) (5,000)
Chevron Corporation Oct. 65 Call.............................................. (300) (21,000)
ConocoPhillips Sept. 65 Call.................................................. (750) (165,000)
Dow Chemical Company Oct. 50 Call............................................. (300) (3,000)
Exxon Mobil Corporation Sept. 60 Call......................................... (200) (19,000)
Hartford Financial Services Group, Inc. Sept. 80 Call......................... (392) (1,960)
New Century Financial Corporation Sept. 45 Call............................... (400) (26,000)
Schulmberger Limited Aug. 80 Call............................................. (300) (191,100)
Weyerhaeuser Company Sept. 65 Call............................................ (129) (16,125)
--------------
TOTAL COVERED CALL OPTIONS WRITTEN (PREMIUM RECEIVED $376,350)................ (479,185)
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OTHER LIABILITIES IN EXCESS OF OTHER ASSETS -- (37.3)%........................ (54,559,959) ++
--------------
NET ASSETS -- 100.0%....................................................... $ 146,368,867
==============
* At August 31, 2005, the tax basis cost of the Fund's investments was
$186,890,713, and the unrealized appreciation and depreciation were $18,686,200 and
$(4,168,902), 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 August 31, 2005, these securities amounted to $15,578,041 or 10.3% of
net assets.
++ As of August 31, 2005, $55,000,000 of commercial paper was outstanding with an amortized
cost of $54,751,735. The average discount rate of commercial paper outstanding at
August 31, 2005, was 3.57%. The average daily balance of commercial paper outstanding for
the quarter ended August 31, 2005, was $54,767,970 at a weighted average discount
rate of 1.92%. The maximum face amount of commercial paper outstanding at any time during
the quarter ended August 31, 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
August 31, 2005.
(a) Securities are illiquid.
LLC Limited Liability Company
LP Limited Partnership
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
registrant's 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 October 17, 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 October 17, 2005
By (Signature and Title)* /s/ G. Gregory Hagar
----------------------------------------
G. Gregory Hagar, Vice President and CFO
(Principal Financial Officer)
Date October 17, 2005
* Print the name and title of each signing officer under his or her signature.