NOTES TO FINANCIAL STATEMENTS – DECEMBER 31,
2007
1.
Organization, Investment Objectives, and Summary of Significant Accounting
Policies
Organization and Investment Objectives
–
Global Income Fund, Inc., a Maryland corporation registered under the Investment Company
Act of 1940, as amended (the “Act”), is a non-diversified, closed end
management investment company, whose shares are listed on the American Stock Exchange. The
Fund’s primary and fundamental objective is to provide a high level of income. The
Fund’s secondary, non-fundamental, investment objective is capital appreciation. The
Fund pursues its investment objectives by investing primarily in a global portfolio of
investment grade fixed income securities and closed end funds that invest significantly in
income producing securities. The Fund is subject to the risk of price fluctuations of the
securities held in its portfolio which is generally a function of the underlying credit
ratings of an issuer, currency denomination, duration, and yield of its securities, and
general economic and interest rate conditions. The Fund retains CEF Advisers, Inc. as its
Investment Manager.
The
following is a summary of the Fund’s significant accounting policies.
Security Valuation
– Securities traded
primarily on the NASDAQ Stock Market (“NASDAQ”) are normally valued by the Fund
at the NASDAQ Official Closing Price (“NOCP”) provided by NASDAQ each business
day. The NOCP is the most recently reported price as of 4:00:02 p.m., Eastern time, unless
that price is outside the range of the “inside” bid and asked prices (i.e., the
bid and asked prices that dealers quote to each other when trading for their own accounts);
in that case, NASDAQ will adjust the price to equal the inside bid or asked price,
whichever is closer. Because of delays in reporting trades, the NOCP may not be based on
the price of the last trade to occur before the market closes. Such securities that are not
traded on a particular day, securities traded in the over-the-counter market that are not
on NASDAQ, and foreign securities are valued at the mean between the current bid and asked
prices. Certain of the securities in which the Fund invests are priced through pricing
services that may utilize a matrix pricing system which takes into consideration factors
such as yields, prices, maturities, call features, and ratings on comparable securities.
Bonds may be valued according to prices quoted by a dealer in bonds that offers pricing
services. Open end investment companies are valued at their net asset value. Securities for
which quotations are not readily available or reliable and other assets may be valued as
determined in good faith under the direction of and pursuant to procedures established by
the Fund’s Board of Directors.
Foreign Currency Translation
–
Securities denominated in foreign currencies are translated into U.S. dollars at prevailing
exchange rates. Realized gain or loss on a sale of investments denominated in foreign
currencies is reported separately from gain or loss attributable to a change in foreign
exchange rates for those investments.
Foreign Currency Contracts
– Forward
contracts are marked to market and the change in market value is recorded by the Fund as an
unrealized gain or loss. When a 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 Fund could be exposed to risk if the
counterparties are unable to meet the terms of the contracts or if the value of the
currency changes unfavorably.
Investment in Affiliated Money Market Fund
– The Board of Directors has authorized the Fund to invest daily available cash
balances in Midas Dollar Reserves, Inc. (“MDR”). MDR is an open end investment
company registered under the Act. MDR operates as a money market fund and seeks maximum
current income consistent with preservation of capital and maintenance of liquidity by
investing exclusively in obligations of the U.S. Government, its agencies and
instrumentalities. Midas Management Corporation (“MMC”) and Investor Service
Center, Inc. (“ISC”), affiliates of the Investment Manager, act as the
investment adviser and distributor, respectively, of MDR. The Investment Manager, MMC, and
ISC are wholly owned subsidiaries of Winmill & Co. Incorporated. As a shareholder,
the Fund is subject to its proportional share of MDR’s expenses, including its
management and distribution fees. MMC and ISC have voluntarily waived management and
distribution fees, respectively, due from MDR. These voluntary reimbursements to MDR may be
terminated at any time. Should ISC no longer voluntarily waive its distribution fee, the
Investment Manager will waive a sufficient amount of its management fee to offset the cost
of ISC’s distribution fee.
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GLOBAL INCOME FUND,
INC.
|
|
8
|
|
|
NOTES TO FINANCIAL STATEMENTS – DECEMBER 31,
2007 (CONTINUED)
Investments in Other Investment Companies
– The Fund may invest, from time to time, in shares of other investment companies (or
entities that would be considered investment companies but are excluded from the definition
pursuant to certain exceptions under the Act) (the “Acquired Funds”) in
accordance with the Act and related rules. As a shareholder in the Fund, you would bear the
pro rata portion of the periodic expenses of the Acquired Funds in addition to the
Fund’s expenses. For the year ended December 31, 2007, the Fund’s pro rata
portion of the periodic expenses charged by the Acquired Funds was approximately
0.026%.
Security Transactions
– Investment
transactions are accounted for on the trade date (the date the order to buy or sell is
executed). Net realized gains and losses are determined on the identified cost basis, which
is also used for federal income tax purposes.
Investment Income
– Interest income is
recorded on the accrual basis. Amortization of premium and accretion of discount on debt
securities are included in interest income. Dividend income is recorded on the ex-dividend
date. Withholding taxes on foreign dividends have been provided for in accordance with the
Fund’s understanding of the applicable country’s tax rules and
rates.
Expenses
– Estimated expenses are
accrued daily. Expenses directly attributable to the Fund are charged to the Fund. Expenses
borne by the complex of related investment companies, which includes open end and closed
end investment companies for which the Investment Manager or its affiliates serves as
investment manager, that are not directly attributed to the Fund are allocated among the
Fund and the other investment companies in the complex on the basis of relative net assets,
except where a more appropriate allocation of expenses to each investment company in the
complex otherwise can be made fairly.
Expense Reduction Arrangement
– Through
arrangements with the Fund’s custodian and cash management bank, credits realized as
a result of uninvested cash balances were used to reduce custody expense by
$1,835.
Distributions
– Distributions to
shareholders are recorded on the ex-dividend date and are determined according to income
tax regulations (tax basis). Distributable earnings determined on a tax basis may differ
from earnings recorded in accordance with accounting principles generally accepted in the
United States of America. These differences may be permanent or temporary. Permanent
differences are reclassified among capital accounts to reflect their tax character. These
reclassifications have no impact on net assets or the results of operations. Temporary
differences are not reclassified, as they may reverse in subsequent periods.
Income Taxes
– No provision has been
made for U.S. income taxes because the Fund’s current intention is to continue to
qualify as a regulated investment company under the Internal Revenue Code and to distribute
to its shareholders substantially all of its taxable income and net realized gains. Foreign
securities held by the Fund may be subject to foreign taxation. Foreign taxes, if any, are
recorded based on the tax regulations and rates that exist in the foreign markets in which
the Fund invests.
Use of Estimates
– In preparing
financial statements in conformity with accounting principles generally accepted in the
United States of America, management makes estimates and assumptions that affect the
reported amounts of assets and liabilities at the date of the financial statements, as well
as the reported amounts of revenues and expenses during the reporting period. Actual
results could differ from those estimates.
Indemnifications
– The Fund indemnifies
its officers and directors for certain liabilities that might arise from their performance
of their duties for the Fund. Additionally, in the normal course of business the Fund
enters into contracts that contain a variety of representations and warranties and which
may provide general indemnifications. The Fund’s maximum exposure under these
arrangements is unknown as it involves future claims that may be made against the Fund
under circumstances that have not occurred.
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9
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|
GLOBAL
INCOME FUND, INC.
|
NOTES TO FINANCIAL STATEMENTS – DECEMBER 31,
2007 (CONTINUED)
2.
Fees and Transactions with Related Parties
The Fund retains the Investment Manager pursuant to
an Investment Management Agreement (“IMA”). Under the terms of the IMA, the
Investment Manager receives a management fee, payable monthly, based on the average daily
net assets of the Fund at an annual rate of
7
/
10
of 1% of the first $50 million,
5
/
8
of 1% over $50 million to $150 million, and
1
/
2
of 1% over $150 million. Prior to November 20,
2007, the management fee was based on the average weekly net assets of the Fund. Certain
officers and directors of the Fund are officers and directors of the Investment Manager.
Pursuant to the IMA, the Fund reimburses the Investment Manager for providing at cost
certain administrative services comprised of compliance and accounting services. For the
year ended December 31, 2007, the Fund incurred total administrative costs of $88,845,
comprised of $51,450 and $37,395 for compliance and accounting services,
respectively.
3.
Distributions to Shareholders and Distributable Earnings
The
tax character of distributions paid to shareholders for the year ended December 31,
2007 and 2006 was as follows:
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|
2007
|
|
2006
|
Distributions paid from:
|
|
|
|
|
|
|
Ordinary income
|
|
$
|
1,276,991
|
|
$
|
995,603
|
Return of capital
|
|
|
350,108
|
|
|
1,072,996
|
|
|
|
|
|
|
|
|
|
$
|
1,627,099
|
|
$
|
2,068,599
|
|
|
|
|
|
|
|
As of
December 31, 2007, the components of distributable earnings on a tax basis were as
follows:
|
|
|
|
|
Unrealized appreciation on investments
and foreign currencies
|
|
$
|
2,471,647
|
|
Capital loss carryovers
|
|
|
(3,003,181
|
)
|
Post-October foreign currency
losses
|
|
|
—
|
|
|
|
|
|
|
|
|
$
|
(531,534
|
)
|
|
|
|
|
|
Accounting principles generally accepted in the
United States of America require certain components of net assets to be reclassified
between financial and tax reporting. These reclassifications have no effect on net assets
or net asset value per share. For the year ended December 31, 2007, permanent
differences between book and tax accounting have been reclassified as follows:
|
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|
|
|
|
|
|
Decrease in
Accumulated Undistributed
Net Investment Loss
|
|
Decrease in Accumulated
Net Realized Loss on
Investments and Foreign Currencies
|
|
Decrease in
Paid-in Capital
|
|
$
|
662,591
|
|
$
|
1,396,051
|
|
$
|
(2,058,642
|
)
|
As of
December 31, 2007, the Fund had net capital loss carryovers of $3,003,181, of which
$1,381,580, $1,369,211 and $252,390 expires in 2008, 2010, and 2014, respectively, that may
be used to offset future realized capital gains for federal income tax purposes.
4.
Securities Transactions
Purchases and sales of securities, other than short
term investments, aggregated $3,200,416 and $3,351,569, respectively, for the year ended
December 31, 2007. At December 31, 2007, for federal income tax purposes the
aggregate cost of securities was $30,822,120 and net unrealized appreciation was
$2,433,210, comprised of gross unrealized appreciation of $2,651,776 and gross unrealized
depreciation of $218,566.
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|
GLOBAL INCOME FUND,
INC.
|
|
10
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|
|
NOTES TO FINANCIAL STATEMENTS – DECEMBER 31,
2007 (CONTINUED)
5.
Affiliated Issuer
The
term affiliate, as defined under the Act, includes companies in which there is a direct or
indirect (a) ownership of, control of, or voting power over 5% or more of the
outstanding voting shares or (b) control of, or common control under, another company
or persons. Transactions with affiliates for the year ended December 31, 2007 were as
follows:
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|
|
|
|
|
|
|
|
|
|
|
|
Number of Shares Held
|
|
|
|
|
|
Realized
Gains/
(Losses)
|
Name of Issuer
|
|
December 31,
2006
|
|
Gross
Additions
|
|
Gross
Reductions
|
|
December 31,
2007
|
|
Value
December 31, 2007
|
|
Dividend
Income
|
|
Midas Dollar Reserves, Inc.
|
|
—
|
|
3,626,791
|
|
3,555,424
|
|
71,367
|
|
$
|
71,367
|
|
$
|
22,985
|
|
$
|
—
|
6.
Bank Credit Facility
The
Fund, Foxby Corp., Midas Fund, Inc., and Midas Special Fund, Inc. (the
“Borrowers”) have entered into a committed secured line of credit facility with
State Street Bank & Trust Company (“Bank”), the Fund’s
custodian. Foxby Corp. is a closed end investment company managed by the Investment
Manager, and Midas Fund, Inc. and Midas Special Fund, Inc. are open end investment
companies managed by MMC, an affiliate of the Investment Manager. The aggregate amount of
the credit facility is $25,000,000. The borrowing of each Borrower is collateralized by the
underlying investments of such Borrower. The Bank will make revolving loans to a Borrower
not to exceed in the aggregate outstanding at any time with respect to any one Borrower,
the least of $25,000,000, the maximum amount permitted pursuant to each Borrower’s
investment policies, or as permitted under the Act. The commitment fee on this facility is
0.10% per annum on the unused portion of the commitment, based on a 360-day year. All
loans under this facility will be available at the Borrower’s option of
(i) overnight Federal funds or (ii) LIBOR (30, 60, 90 days), each as in effect
from time to time, plus 0.75% per annum, calculated on the basis of actual days
elapsed for a 360-day year. At December 31, 2007, the Fund had no outstanding
borrowings under the facility. For the year ended December 31, 2007, the Fund’s
weighted average interest rate under the facility was 5.50% based on its balances
outstanding during the period and the Fund’s average daily amount outstanding during
the period was $50,827.
7.
Foreign Securities Risk
Investing in securities of foreign issuers involves
special risks which include changes in foreign exchange rates and the possibility of future
adverse political and economic developments which could adversely affect the value of such
securities. Moreover, securities of many foreign issuers and in foreign markets may be less
liquid and their prices more volatile than those of U.S. issuers and markets.
8.
Capital Stock
At
December 31, 2007, there were 7,398,713 shares of $.01 par value common stock
outstanding (20,000,000 shares authorized). The shares issued and resulting increase in
paid-in capital in connection with reinvestment of distributions for the years ended
December 31, 2007 and 2006 were as follows:
|
|
|
|
|
|
|
|
|
2007
|
|
2006
|
Shares issued
|
|
|
5,141
|
|
|
8,784
|
Increase in paid-in capital
|
|
$
|
20,365
|
|
$
|
35,168
|
|
|
|
|
|
|
|
11
|
|
GLOBAL
INCOME FUND, INC.
|
NOTES TO FINANCIAL STATEMENTS – DECEMBER 31,
2007 (CONCLUDED)
9.
Recently Issued Accounting Standards
The
Fund adopted Financial Accounting Standards Board (“FASB”) Interpretation
No. 48, “Accounting for Uncertainty in Income Taxes—an Interpretation of
FASB Statement No. 109, Accounting for Income Taxes” (“FIN 48”) on
June 29, 2007. FIN 48 provides guidance for how uncertain tax positions should be
recognized, measured, presented, and disclosed in the financial statements. FIN 48 requires
an evaluation of tax positions taken or expected to be taken in the course of preparing the
Fund’s tax returns to determine whether the tax positions are
“more-likely-than-not” of being sustained by the applicable tax authority. Tax
position not deemed to meet the more-likely-than-not threshold would be recorded as a tax
benefit or expense in the current year. Management has analyzed the Fund’s tax
positions taken on federal, state, and local income tax returns for all open tax years (tax
years ended December 31, 2004—2007) and has concluded that no provision from
income tax is required in the Fund’s financial statements.
The
FASB issued Statement of Financial Accounting Standards No. 157, “Fair Value
Measurements” (“FAS 157”), in September 2006, which is effective for
fiscal years beginning after November 15, 2007. FAS 157 defines fair value,
establishes a framework for measuring fair value, and expands the required financial
statement disclosures about fair value measurements. Management is currently evaluating the
impact of adopting FAS 157.
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|
|
GLOBAL INCOME FUND,
INC.
|
|
12
|
|
|
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
To
the Board of Directors and Shareholders of Global Income Fund, Inc.
We
have audited the accompanying statement of assets and liabilities of Global Income Fund,
Inc. including the schedule of portfolio investments as of December 31, 2007 and the
related statement of operations for the year then ended, the statements of changes in net
assets for each of the two years in the period then ended, and the financial highlights for
each of the years indicated thereon. These financial statements and financial highlights
are the responsibility of the Fund’s management. Our responsibility is to express an
opinion on these financial statements and financial highlights based on our
audit.
We
conducted our audits in accordance with auditing 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 and financial
highlights are free of material misstatement. The Fund is not required to have, nor were we
engaged to perform, an audit of its internal control over financial reporting. Our audits
included consideration of internal control over financial reporting as a basis for
designing audit procedures that are appropriate in the circumstances, but not for the
purpose of expressing an opinion on the effectiveness of the Fund’s internal control
over financial reporting. Accordingly, we express no such opinion. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in the
financial statements. Our procedures included confirmation of securities owned as of
December 31, 2007 by correspondence with the custodian. An audit also includes
assessing the accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In
our opinion, the financial statements and financial highlights referred to above present
fairly, in all material respects, the financial position of Global Income Fund, Inc. as of
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 years indicated thereon, in conformity with accounting
principles generally accepted in the United States of America.
TAIT, WELLER & BAKER LLP
Philadelphia, Pennsylvania
February 26, 2008
|
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|
|
GLOBAL INCOME FUND,
INC.
|
|
14
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|
|
INVESTMENT OBJECTIVES AND POLICIES
The
Fund’s primary investment objective of providing a high level of income is
fundamental and may not be changed without shareholder approval. The Fund is also subject
to certain investment restrictions, set forth in its most recently effective Statement of
Additional Information, that are fundamental and cannot be changed without shareholder
approval. The Fund’s secondary investment objective of capital appreciation and the
other investment policies described herein, unless otherwise stated, are not fundamental
and may be changed by the Board of Directors without shareholder approval. Notice to
shareholders of any change in the Fund’s secondary investment objective will be
provided as required by law.
PRIVACY POLICY
The
Fund recognizes the importance of protecting the personal and financial information of its
shareholders. We consider each shareholder’s personal information to be private and
confidential. This describes the practices followed by us to protect our
shareholders’ privacy. We may obtain information about you from the following
sources: (1) information we receive from you on forms and other information you
provide to us whether in writing, by telephone, electronically or by any other means; and
(2) information regarding your transactions with us, our corporate affiliates, or
others. We do not sell shareholder personal information to third parties. We will collect
and use shareholder personal information only to service shareholder accounts. This
information may be used by us in connection with providing services or financial products
requested by shareholders. We will not disclose shareholder personal information to any
non-affiliated third party except as permitted by law. We take steps to safeguard
shareholder information. We restrict access to non-public personal information about you to
those employees and service providers who need to know such information to provide products
or services to you. Together with our service providers, we maintain physical, electronic,
and procedural safeguards to guard your non-public personal information. Even if you are no
longer a shareholder, our Privacy Policy will continue to apply to you. We reserve the
right to modify, remove, or add portions of this Privacy Policy at any time.
PROXY VOTING
The
Fund’s Proxy Voting Guidelines (the “Guidelines”) and its voting record
for the most recent 12 months ended June 30, are available without charge by calling
the Fund collect at 1-212-344-6310 and on the SEC’s website at www.sec.gov. The
Guidelines are also posted at www.globalincomefund.net.
QUARTERLY HOLDINGS
The
Fund files its complete schedule of portfolio holdings with the SEC for the first and third
quarters of each fiscal year on Form N-Q. The Fund’s Forms N-Q are available on the
SEC’s website at http://www.sec.gov. The Fund’s Forms N-Q may be reviewed and
copied at the SEC’s Public Reference Room in Washington, DC, and information on the
operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330. The Fund
makes the Forms N-Q available on its website at www.globalincomefund.net.
WWW.GLOBALINCOMEFUND.NET
Visit
us on the web at www.globalincomefund.net. The site provides information about the Fund,
including market performance, net asset value (“NAV”), dividends, press
releases, and shareholder reports. For further information, please email us at
info@globalincomefund.net. The Fund is a member of the Closed-End Fund Association
(“CEFA”). Its website address is www.cefa.com. CEFA is solely responsible for
the content of its website.
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|
|
Additional Information
(Unaudited)
|
|
15
|
|
GLOBAL
INCOME FUND, INC.
|
MANAGED DISTRIBUTIONS
The
Board’s current policy is to provide investors with a stable quarterly distribution
out of current income, supplemented by realized capital gains, and to the extent necessary,
paid-in capital. The Fund is subject to U.S. corporate, tax, and securities laws. Under
U.S. tax accounting rules, the amount of distributable net income is determined on an
annual basis and is dependent during the fiscal year on the aggregate gains and losses
realized by the Fund and, to a lesser extent, the actual exchange rate between the U.S.
dollar and the currencies in which Fund assets are denominated. Therefore, the exact amount
of distributable income can only be determined as of the end of the Fund’s fiscal
year. Under the Investment Company Act of 1940, as amended, however, the Fund is required
to indicate the source of each distribution to shareholders. The Fund estimates that
distributions for the fiscal period commencing January 1, 2008, including the
distributions paid quarterly, will be comprised approximately three-quarters of net
investment income and the balance from paid-in capital. This estimated distribution
composition may vary from quarter to quarter because it may be materially impacted by
future realized gains and losses on securities and fluctuations in the value of currencies
in which Fund assets are denominated. In January after each fiscal year, a Form 1099-DIV
will be sent to shareholders stating the amount and composition of distributions and
providing information about their appropriate tax treatment.
DIVIDEND REINVESTMENT PLAN
Terms and Conditions of
the 2008 Restated Dividend Reinvestment
Plan
1.
Each shareholder (the “Shareholder”) holding shares of common stock (the
“Shares”) of Global Income Fund, Inc. (the “Fund”) will
automatically be a participant in the Dividend Reinvestment Plan (the “Plan”),
unless the Shareholder specifically elects to receive all dividends and capital gains in
cash paid by check mailed directly to the Shareholder by American Stock Transfer &
Trust Company, 59 Maiden Lane, New York, New York 10038, 1-800-278-4353, as agent under the
Plan (the “Agent”). The Agent will open an account for each Shareholder under
the Plan in the same name in which such Shareholder’s shares of Common Stock are
registered.
2.
Whenever the Fund declares a capital gain distribution or an income dividend payable in
Shares or cash, participating Shareholders will take the distribution or dividend entirely
in Shares and the Agent will automatically receive the Shares, including fractions, for the
Shareholder’s account in accordance with the following:
Whenever the Market Price (as defined in
Section 3 below) per Share is equal to or exceeds the net asset value per Share at the
time Shares are valued for the purpose of determining the number of Shares equivalent to
the cash dividend or capital gain distribution (the “Valuation Date”),
participants will be issued additional Shares equal to the amount of such dividend divided
by the greater of the Fund’s net asset value per Share or 95% of the Fund’s
Market Price per Share. Whenever the Market Price per Share is less than such net asset
value on the Valuation Date, participants will be issued additional Shares equal to the
amount of such dividend divided by the Market Price. The Valuation Date is the day before
the dividend or distribution payment date or, if that day is not an American Stock Exchange
trading day, the next trading day. If the Fund should declare a dividend or capital gain
distribution payable only in cash, the Agent will, as purchasing agent for the
participating Shareholders, buy Shares in the open market, on the American Stock Exchange
(the “Exchange”) or elsewhere, for such Shareholders’ accounts after the
payment date, except that the Agent will endeavor to terminate purchases in the open market
and cause the Fund to issue the remaining Shares if, following the commencement of the
purchases, the market value of the Shares exceeds the net asset value. These remaining
Shares will be issued by the Fund at a price equal to the Market Price.
In a case where the Agent has terminated open market
purchases and caused the issuance of remaining Shares by the Fund, the number of Shares
received by the participant in respect of the cash dividend or distribution will be based
on the weighted average of prices paid for Shares purchased in the open market and the
price at which the Fund issues remaining Shares. To the extent that the Agent is unable to
terminate purchases in the open market before the Agent has completed
|
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|
|
GLOBAL INCOME FUND,
INC.
|
|
16
|
|
Additional
Information (Unaudited)
|
its purchases, or remaining Shares cannot be issued
by the Fund because the Fund declared a dividend or distribution payable only in cash, and
the market price exceeds the net asset value of the Shares, the average Share purchase
price paid by the Agent may exceed the net asset value of the Shares, resulting in the
acquisition of fewer Shares than if the dividend or capital gain distribution had been paid
in Shares issued by the Fund.
The Agent will apply all cash received as a dividend
or capital gain distribution to purchase shares of common stock on the open market as soon
as practicable after the payment date of the dividend or capital gain distribution, but in
no event later than 45 days after that date, except when necessary to comply with
applicable provisions of the federal securities laws.
3.
For all purposes of the Plan: (a) the Market Price of the Shares on a particular date
shall be the average of the volume weighted average sale prices or, if no sale occurred
then the mean between the closing bid and asked quotations, for the Shares on the Exchange
on each of the five trading days the Shares traded ex-dividend on the Exchange immediately
prior to such date, and (b) net asset value per share on a particular date shall be as
determined by or on behalf of the Fund.
4.
The open-market purchases provided for herein may be made on any securities exchange on
which the Shares are traded, in the over-the-counter market or in negotiated transactions,
and may be on such terms as to price, delivery and otherwise as the Agent shall determine.
Funds held by the Agent uninvested will not bear interest, and it is understood that, in
any event, the Agent shall have no liability in connection with any inability to purchase
Shares within 45 days after the initial date of such purchase as herein provided, or with
the timing of any purchases effected. The Agent shall have no responsibility as to the
value of the Shares acquired for the Shareholder’s account.
5.
The Agent will hold Shares acquired pursuant to the Plan in noncertificated form in the
Agent’s name or that of its nominee. At no additional cost, a Shareholder
participating in the Plan may send to the Agent for deposit into its Plan account those
certificate shares of the Fund in its possession. These Shares will be combined with those
unissued full and fractional Shares acquired under the Plan and held by the Agent. Shortly
thereafter, such Shareholder will receive a statement showing its combined holdings. The
Agent will forward to the Shareholder any proxy solicitation material and will vote any
Shares so held for the Shareholder only in accordance with the proxy returned by the
Shareholder to the Fund. Upon the Shareholder’s written request, the Agent will
deliver to him or her, without charge, a certificate or certificates for the full
Shares.
6.
The Agent will confirm to the Shareholder each acquisition for the Shareholder’s
account as soon as practicable but not later than 60 days after the date thereof. Although
the Shareholder may from time to time have an individual fractional interest (computed to
three decimal places) in a Share, no certificates for fractional Shares will be issued.
However, dividends and distributions on fractional Shares will be credited to
Shareholders’ accounts. In the event of a termination of a Shareholder’s
account under the Plan, the Agent will adjust for any such undivided fractional interest in
cash at the opening market value of the Shares at the time of termination.
7.
Any stock dividends or split Shares distributed by the Fund on Shares held by the Agent for
the Shareholder will be credited to the Shareholder’s account. In the event that the
Fund makes available to the Shareholder the right to purchase additional Shares or other
securities, the Shares held for a Shareholder under the Plan will be added to other Shares
held by the Shareholder in calculating the number of rights to be issued to such
Shareholder. Transaction processing may either be curtailed or suspended until the
completion of any stock dividend, stock split, or corporate action.
8.
The Agent’s service fee for handling capital gain distributions or income dividends
will be paid by the Fund. The Shareholder will be charged a pro rata share of brokerage
commissions on all open market purchases.
9.
The Shareholder may terminate the account under the Plan by notifying the Agent. A
termination will be effective immediately if notice is received by the Agent two days prior
to any dividend or distribution payment date. If the request is received less than two days
prior to the payment date, then that dividend will be invested, and all subsequent
dividends will be paid in cash. Upon any termination the Agent will cause a
certifi-
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Additional Information
(Unaudited)
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17
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GLOBAL
INCOME FUND, INC.
|
cate
or certificates for the full Shares held for the Shareholder under the Plan and cash
adjustment for any fraction to be delivered to the Shareholder.
10.
These terms and conditions may be amended or supplemented by the Fund at any time or times
but, except when necessary or appropriate to comply with applicable law or the rules or
policies of the Securities and Exchange Commission or any other regulatory authority, only
by mailing to the Shareholder appropriate written notice at least 30 days prior to the
effective date thereof. The amendment or supplement shall be deemed to be accepted by the
Shareholder unless, prior to the effective date thereof, the Agent receives written notice
of the termination of such Shareholder’s account under the Plan. Any such amendment
may include an appointment by the Fund of a successor agent in its place and stead under
these terms and conditions, with full power and authority to perform all or any of the acts
to be performed by the Agent. Upon any such appointment of an Agent for the purpose of
receiving dividends and distributions, the Fund will be authorized to pay to such successor
Agent all dividends and distributions payable on Shares held in the Shareholder’s
name or under the Plan for retention or application by such successor Agent as provided in
these terms and conditions.
11.
In the case of Shareholders, such as banks, brokers or nominees, which hold Shares for
others who are the beneficial owners, the Agent will administer the Plan on the basis of
the number of Shares certified from time to time by the Shareholders as representing the
total amount registered in the Shareholder’s name and held for the account of
beneficial owners who are to participate in the Plan.
12.
The Agent shall at all times act in good faith and agree to use its best efforts within
reasonable limits to insure the accuracy of all services performed under this agreement and
to comply with applicable law, but assumes no responsibility and shall not be liable for
loss or damage due to errors unless the errors are caused by its negligence, bad faith or
willful misconduct or that of its employees.
13.
Neither the Fund or the Agent will be liable for any act performed in good faith or for any
good faith omission to act, including without limitation, any claim of liability arising
out of (i) failure to terminate a Shareholder’s account, sell shares or purchase
shares, (ii) the prices which shares are purchased or sold for the Shareholder’s
account, and (iii) the time such purchases or sales are made, including price
fluctuation in market value after such purchases or sales.
HISTORICAL DISTRIBUTION SUMMARY
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|
|
|
Period
|
|
Investment
Income
|
|
Return of
Capital
|
|
Total
|
2007
|
|
$
|
0.170
|
|
$
|
0.050
|
|
$
|
0.220
|
2006
|
|
$
|
0.130
|
|
$
|
0.150
|
|
$
|
0.280
|
2005
|
|
$
|
0.200
|
|
$
|
0.080
|
|
$
|
0.280
|
2004
|
|
$
|
0.245
|
|
$
|
0.090
|
|
$
|
0.335
|
2003
|
|
$
|
0.220
|
|
$
|
0.140
|
|
$
|
0.360
|
2002
|
|
$
|
0.280
|
|
$
|
0.220
|
|
$
|
0.500
|
2001
|
|
$
|
0.360
|
|
$
|
0.200
|
|
$
|
0.560
|
2000
|
|
$
|
0.420
|
|
$
|
0.160
|
|
$
|
0.580
|
6 Months Ended 12/31/99
|
|
$
|
0.230
|
|
$
|
0.070
|
|
$
|
0.300
|
12 Months Ended 6/30/99
|
|
$
|
0.550
|
|
$
|
0.130
|
|
$
|
0.680
|
12 Months Ended 6/30/98
|
|
$
|
0.520
|
|
$
|
0.320
|
|
$
|
0.840
|
|
|
|
|
|
GLOBAL INCOME FUND,
INC.
|
|
18
|
|
Additional
Information (Unaudited)
|
STOCK DATA
|
|
|
|
|
|
|
|
|
Price (12/31/07)
|
|
$
|
3.90
|
|
Net Asset Value (12/31/07)
|
|
$
|
4.60
|
|
Discount
|
|
|
15.2
|
%
|
American Stock Exchange Symbol: GIF Newspaper
exchange listings appear under an abbreviation, such as: Glinc
2008 DISTRIBUTION PAYMENT DATES
|
|
|
|
|
Declaration
|
|
Record
|
|
Payment
|
March 3
|
|
March 17
|
|
March 31
|
June 2
|
|
June 16
|
|
June 30
|
September 4
|
|
September 18
|
|
September 30
|
December 1
|
|
December 15
|
|
December 31
|
FUND INFORMATION
|
|
|
Investment
Manager
|
|
Stock Transfer Agent
and Registrar
|
CEF Advisers, Inc.
11 Hanover Square
New York, NY 10005
1-212-344-6310
|
|
American Stock Transfer & Trust
Co.
59 Maiden Lane
New York, NY 10038
www.amstock.com
1-800-278-4353
|