Each quarter, the
The Fund makes annual distributions of its realized net long-term capital gains and quarterly cash distributions of all or a portion of its investment company taxable income (which includes ordinary income and net realized short-term capital gains) to common shareholders. A portion of the distribution may be a return of capital. Various factors will affect the level of the Fund’s income, such as its asset mix and use of merger arbitrage strategies. To permit the Fund to maintain more stable distributions, the Fund may distribute more than the entire amount of income earned in a particular period. Because the Fund’s current quarterly distributions are subject to modification by the
If the Fund does not generate sufficient earnings (dividends and interest income and realized net capital gain) equal to or in excess of the aggregate distributions paid by the Fund in a given year, then the amount distributed in excess of the Fund’s earnings would be deemed a return of capital. Since this would be considered a return of a portion of a shareholder’s original investment, it is generally not taxable and is treated as a reduction in the shareholder’s cost basis. Under federal tax regulations, some or all of the return of capital distributed by the Fund may be taxable as ordinary income in certain circumstances. This may occur when the Fund has a capital loss carry forward, net capital gains are realized in a fiscal year, and distributions are made in excess of investment company taxable income.
Short-term capital gains, qualified dividend income, ordinary income, and return of capital, if any, will be allocated on a pro-rata basis to all distributions to common shareholders for the year. Based on the accounting records of the Fund as of
Investors should carefully consider the investment objectives, risks, charges, and expenses of the Fund before investing.More information regarding the Fund’s distribution policy and other information about the Fund is available by calling 800-
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