SCHEDULE 14A INFORMATION
ProxyStatement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. )
Filed by Registrant [ X ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted b
Rule 14a-6(e)(2))
[ X ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sec. 240.14a-11(c) or Sec. 240.14a-12
The Gabelli Equity Trust Inc.
. . . . . . .
(Name of Registrant as Specified In Its Charter)
. . . . . . . . . .
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[ X ] No fee required
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11(set forth the amount on which the filing fee is
calculated and state how it was determined):
4) Proposed maximum aggregate value of transaction:
5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule or Registration Statement No.:
3) Filing Party:
4) Date Filed:
<PAGE>
The Gabelli Equity Trust Inc.
One Corporate Center
Rye, New York 10580-1434
(914) 921-5070
-------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
To Be Held on May 12, 1997
-------------
To the Shareholders of
THE GABELLI EQUITY TRUST INC.
Notice is hereby given that the Annual Meeting of Shareholders of The
Gabelli Equity Trust Inc. (the "Equity Trust") will be held at the Cole
Auditorium, Greenwich Public Library, 101 West Putnam Avenue, Greenwich,
Connecticut 06830, on Monday, May 12, 1997, at 9:30 a.m., for the following
purposes:
1. To elect three Directors of the Equity Trust (PROPOSAL 1);
2. To ratify the selection of Price Waterhouse LLP as the independent
accountants of the Equity Trust for the year ending December 31, 1997
(PROPOSAL 2);
3. To approve the revision of the fundamental investment
restriction regarding senior securities (PROPOSAL 3(a); and
4. To consider and vote upon such other matters as may come before said
meeting or any adjournment
thereof.
These items are discussed in greater detail in the attached Proxy
Statement.
The close of business on March 3, 1997, has been fixed as the record
date for the determination of shareholders entitled to notice of and to vote at
the meeting and any adjournments thereof.
YOUR VOTE IS IMPORTANT REGARDLESS OF THE SIZE OF YOUR HOLDINGS IN THE
EQUITY TRUST. WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, WE ASK THAT YOU
PLEASE COMPLETE AND SIGN THE ENCLOSED PROXY CARD AND RETURN IT PROMPTLY IN THE
ENCLOSED ENVELOPE WHICH NEEDS NO POSTAGE IF MAILED IN THE CONTINENTAL UNITED
STATES. INSTRUCTIONS FOR THE PROPER EXECUTION OF PROXIES ARE SET FORTH ON THE
INSIDE COVER.
By Order of the Directors
JAMES E. MCKEE
Secretary
April 3 , 1997
<PAGE>
INSTRUCTIONS FOR SIGNING PROXY CARDS
The following general rules for signing proxy cards may be of
assistance to you and avoid the time and expense to the Equity Trust involved in
validating your vote if you fail to sign your proxy card properly.
1. Individual Accounts: Sign your name exactly as it appears in the
registration on the proxy card.
2. Joint Accounts: Either party may sign, but the name of the party signing
should conform exactly to a name shown in the registration.
3. All Other Accounts: The capacity of the individuals signing the proxy card
should be indicated unless it is reflected in the form of registration. For
example:
Registration Valid Signature
Corporate Accounts
(1) ABC Corp............................... ABC Corp.
(2) ABC Corp............................... John Doe, Treasurer
(3) ABC Corp.
c/o John Doe, Treasurer................ John Doe
(4) ABC Corp., Profit Sharing Plan......... John Doe, Trustee
Trust Accounts
(1) ABC Trust.............................. Jane B. Doe, Trustee
(2) Jane B. Doe, Trustee
u/t/d 12/28/78......................... Jane Doe
Custodian or Estate Accounts
(1) John B. Smith, Cust.
f/b/o John B. Smith, Jr. UGMA.......... John B. Smith
(2) John B. Smith.......................... John B. Smith, Jr.,
Executor
<PAGE>
THE GABELLI EQUITY TRUST INC.
ANNUAL MEETING OF SHAREHOLDERS
May 12, 1997
----------
PROXY STATEMENT
This Proxy Statement is furnished in connection with the solicitation
of proxies by the Directors of The Gabelli Equity Trust Inc. (the "Equity
Trust") for use at the Annual Meeting of Shareholders of the Equity Trust to be
held on May 12, 1997, at 9:30 a.m., at the Cole Auditorium, Greenwich Public
Library, 101 West Putnam Avenue, Greenwich, Connecticut, and at any adjournments
thereof (the "Meeting"). A Notice of Meeting of Shareholders and a proxy card
accompany this Proxy Statement.
In addition to the solicitation of Proxies by mail, officers of the
Equity Trust and officers and regular employees of Boston EquiServe, the Equity
Trust's transfer agent, affiliates of Boston EquiServe or other representatives
of the Equity Trust also may solicit proxies by telephone, telegraph or in
person. In addition, the Equity Trust has retained Georgeson and Company Inc. to
assist in the solicitation of Proxies for a fee estimated at $6,000 plus
reimbursement of expenses. The costs of solicitation and the expenses incurred
in connection with preparing the Proxy Statement and its enclosures will be paid
by the Equity Trust. The Equity Trust will reimburse brokerage firms and others
for their expenses in forwarding solicitation materials to the beneficial owners
of shares. The Equity Trust's most recent annual report is available upon
request, without charge, by writing the Equity Trust at One Corporate Center,
Rye, New York, 10580-1434 or calling the Equity Trust at (800) 422-3554.
If the enclosed Proxy is properly executed and returned in time to be
voted at the Meeting, the shares represented thereby will be voted in accordance
with the instructions marked thereon. Unless instructions to the contrary are
marked thereon, the Proxy will be voted FOR the election of the nominees as
Directors, FOR the other matters listed in the accompanying Notice of Annual
Meeting of Shareholders and FOR any other matters deemed appropriate. Any
shareholder who has given a Proxy has the right to revoke it at any time prior
to its exercise either by attending the Meeting and voting his or her shares in
person or by submitting a letter of revocation or a later-dated Proxy to the
Equity Trust at the above address prior to the date of the Meeting.
In the event a quorum is present at the Meeting but sufficient votes to
approve any of the proposed items are not received, the persons named as proxies
may propose one or more adjournments of such Meeting to permit further
solicitation of proxies. A shareholder vote may be taken on one or more of the
proposals in this Proxy Statement prior to such adjournment if sufficient votes
have been received and it is otherwise appropriate. Any such adjournment will
require the affirmative vote of a majority of those shares present at the
Meeting in person or by proxy and the persons named as proxies will
vote those proxies which they are entitled to vote FOR or AGAINST any such
proposal in their discretion.
The close of business on March 3, 1997, has been fixed as the record
date for the determination of shareholders entitled to notice of and to vote at
the Meeting and all adjournments thereof.
Each shareholder is entitled to one vote for each full share and an
appropriate fraction of a vote for each fractional share held. On the record
date there were 103,919,670 shares of the Equity Trust outstanding.
To the knowledge of the management of the Equity Trust, no person owns
of record or beneficially 5% or more of the shares of the Equity Trust except
that, as of March 3, 1997, 84,850,083 shares were held of record by Cede & Co.,
a nominee partnership of The Depository Trust Company. Of such shares,
21,199,157 shares, representing 20.4% of the outstanding shares of the Equity
Trust, are held by The Depository Trust Company as nominee for Smith Barney
Inc., representing approximately 15,170 discretionary and non-discretionary
accounts.
This Proxy Statement is first being mailed to shareholders on or about
April 3 , 1997.
<PAGE>
PROPOSAL 1: TO ELECT THREE DIRECTORS OF THE EQUITY TRUST
At the Meeting, the following three of the eight Directors of the
Equity Trust are to be elected to hold office for a period of three years and
until their successors are elected and qualified. The Board of Directors is
divided into three classes. Each year the term of office of one class will
expire. Unless authority is withheld, it is the intention of the persons named
in the proxy to vote the proxy FOR the election of the nominees named below.
Each nominee has indicated that he will serve if elected, but if any nominee
should be unable to serve the proxy will be voted for any other person
determined by the persons named in the proxy in accordance with their judgment.
Each of the Directors of the Equity Trust has served in that capacity since the
July 14, 1986 organizational meeting of the Equity Trust with the exception of
Mr. Conn, who became a Director of the Equity Trust on May 15, 1989 and Mr.
Pohl, who became a Director of the Equity Trust on February 19, 1992.
<TABLE>
<CAPTION>
Number and Percentage of
Shares of Capital Stock
Position with the Equity Trust, Beneficially Owned**
Business Experience During Directly or Indirectly on
Name and Business Address Past Five Years and Age March 3, 1997
- ------------------------- - ------------------------ -------------
<S> <C> <C>
James P. Conn Director of the Equity Trust. Managing 23,251***
One Corporate Center Director of Financial Security Assurance
Rye, NY 10580-1434 Holdings Ltd.since 1992; Director of Santa
Anita Realty Enterprises, Inc. since 1995;
Director of Santa Anita Operating Company
since 1995; Director of California Jockey Club
since 1983; President and Chief Executive
Officer of Bay Meadows Operating Company from
1988 through 1992. Mr. Conn is 59 years old.
(1)(2)(10)(14)
Anthony R. Pustorino Director of the Equity Trust. Certified 8,157***
One Corporate Center Public Accountant. Professor of Accounting,
Rye, NY 10580-1434 Pace University, since 1965. Mr. Pustorino is
71 years old. (1)(2)(3) (4)(5)
(10)(11)(13)
*Karl Otto Pohl Director of the Equity Trust. Partner of Sal 0
One Corporate Center Oppenheim Jr. & Cie (private investment bank);
Rye, NY 10580-1434 Currently Board Member of IBM World Trade
Europe/Middle East/Africa Corp.; Bertelsmann
AG; Zurich Versicherungs-Gesellschaft
(insurance); the International Advisory Board
for JP Morgan & Co.; Supervisory Board Member
of Royal Dutch (petroleum company) ROBECo/o
Group; Advisory Director of Unilever N.V. and
Unilever Deutschland. Mr. Pohl is 67 years
old. (1)(2)(3)(4)(5)(6)(7)(8)(9) (10)(11)(12)
(13)
<PAGE>
</TABLE>
The following Directors of the Equity Trust will continue to serve in
such capacity until their terms of office expire and their successors are
elected and qualified.
<TABLE>
<CAPTION>
Number and Percentage of
Shares of Capital Stock
Position with the Equity Trust, Beneficially Owned**
Business Experience During Past Five Years, Directly or Indirectly on
Name and Business Address Age and Date Term Expires March 3, 1997
- ------------------------- ------------------------- --------------
<S> <C> <C>
*Mario J. Gabelli, CFA Chairman of the Board and President of the 1,187,963
One Corporate Center Equity Trust; Chairman of the Board, Chief (1.14%)
Rye, NY 10580-1434 Executive Officer and Chief Investment Officer
of Gabelli Funds, Inc. and of GAMCO
Investors, Inc., Chairman of the Board and
Chief Executive Officer of Lynch
Corporation. Mr. Gabelli is 54 years
old. (1998)
(1)(2)(3)(4)(5)(6)(7)(8)(9)(10)(11)(12) (13)
Dr. Thomas E. Bratter Director of the Equity Trust. Director, 8,873***
One Corporate Center President and Founder, The John Dewey Academy
Rye, NY 10580-1434 (residential college preparatory therapeutic
high school). Dr. Bratter is 56 years old.
(1998) (10)
Felix J. Christiana Director of the Equity Trust. Retired; 29,913***
One Corporate Center formerly Senior Vice President of Dollar Dry
Rye, NY 10580-1434 Dock Savings Bank. Mr. Christiana is 71 years
old. (1998) (1)(2)(3)(4)(5)(8)(10)(13)
Bill Callaghan Director of the Equity Trust. President of 1,359***
One Corporate Center Bill Callaghan Associates, Ltd., an executive
Rye, NY 10580-1434 search company. Mr. Callaghan is 53 years
old. (1999) (3)(10)
* Salvatore J. Zizza Director of the Equity Trust. President and 14,602***
One Corporate Center Chief Executive Officer of The Lehigh Group,
Rye, NY 10580-1434 Inc. (an electrical supply wholesaler) and
Chairman of the Executive Committee and
Director of Binnings Building Products,
Inc. Mr. Zizza is 51 years old.
(1999) (1) (4)(10)
Directors and Officers as a 1,276,115
Group (1.23%)
* "Interested person" of the Equity Trust, as defined in the Investment
Company Act of 1940, as amended (the "1940 Act"). Mr. Gabelli is an
"interested person" as a result of his employment as an officer of the
Equity Trust and its adviser, Gabelli Funds, Inc. (the "Investment
Adviser") . Mr. Gabelli is a registered representative of an affiliated
broker-dealer. Mr. Pohl receives fees from the Investment Adviser
but has no obligation to provide any services to it. Although this
relationship does not appear to require designation of Mr. Pohl as an
"interested person," the Equity Trust has made such designation in order to
avoid the possibility that Mr. Pohl's independence would be questioned.
Mr. Zizza may be an "interested person" as a result of his association with
Binnings Building Products, Inc., an entity controlled by GLI, Inc., an
affiliate of the Investment Adviser.
** For this purpose "beneficial ownership" is defined under Section 13(d)
of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"). The information as to beneficial ownership is based upon
information furnished to the Equity Trust by the Directors.
*** Less than 1%.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
(1) Trustee of The Gabelli Asset Fund (8) Director of Gabelli Global Series Funds, Inc.
(2) Trustee of The Gabelli Growth Fund (9) Director of Gabelli Gold Fund, Inc.
(3) Director of The Gabelli Value Fund Inc. (10) Director of The Gabelli Global
Multimedia
(4) Director of The Gabelli Convertible Securities Fund, Inc. Trust Inc.
(5) Director of Gabelli Equity Series Funds, Inc. (11) Director of Gabelli Capital Series Funds, Inc.
(6) Trustee of The Gabelli Money Market Funds (12) Director of Gabelli International Growth Fund,
Inc.
(7) Director of Gabelli Investor Funds, Inc. (13) Trustee of The Treasurer's Fund, Inc.
(14) Trustee of the Westwood Funds
</TABLE>
The Equity Trust pays each Director not affiliated with the
Investment Adviser or its affiliates, a fee of $12,000 per year plus $1,500
per meeting attended, together with the Director's actual out-of-pocket expenses
relating to attendance at meetings. Prior to July 1, 1996, the Equity Trust paid
each unaffiliated Director a fee of $10,000 per year plus $1,000 per meeting
attended, together with the Director's actual out-of-pocket expenses. The
aggregate remuneration paid by the Equity Trust to such Directors during the
fiscal year ended December 31, 1996, amounted to $117,681.
During the year ended December 31, 1996, the Directors of the Equity
Trust met four times, none of which were special meetings of Directors. Each
Director then serving in such capacity attended at least 75% of the meetings of
Directors and of any Committee of which he is a member. Felix J. Christiana and
Anthony R. Pustorino serve on the Equity Trust's Audit Committee and these
Directors are not "interested persons" of the Equity Trust as defined in the
1940 Act. The Audit Committee is responsible for recommending the selection of
the Equity Trust's independent accountants and reviewing all audit as well as
non-audit accounting services performed for the Equity Trust. During the fiscal
year ended December 31, 1996, the Audit Committee met twice.
The Directors serving on the Equity Trust's Nominating Committee are
Felix J. Christiana (Chairman) and Salvatore J. Zizza . The Nominating
Committee is responsible for recommending qualified candidates to the Board in
the event that a position is vacated or created. The Nominating Committee will
consider recommendations by shareholders if a vacancy were to exist. Such
recommendations should be forwarded to the Secretary of the Equity Trust. The
Nominating Committee did not meet during the fiscal year ended December 31,
1996. The Equity Trust does not have a standing compensation committee.
Bruce N. Alpert, Vice President and Treasurer of the Equity Trust, Marc
S. Diagonale, Vice President of the Equity Trust, and James E. McKee, Secretary
of the Equity Trust, are the only executive officers of the Equity Trust not
included in the listing of Directors above. Mr. Alpert is 45 years old and has
served as an officer of the Equity Trust since August 1988. He currently serves
as Vice President and Chief Operating Officer of the Investment Advisory
Division of the Investment Adviser and as an officer for each mutual fund
managed by the Investment Adviser and Teton Advisers LLC. Mr. Diagonale is 30
years old and served as a client services representative for Gabelli & Company,
Inc. from March 1993 until he became Assistant Vice President of the Equity
Trust on May 9, 1994. He was appointed Vice President of the Equity Trust on
February 22, 1995. Prior to 1993, Mr. Diagonale was a masters of business
administration student at New York University. Mr. McKee is 33 years old and has
served as Secretary of the Equity Trust since August 16, 1995. He has served as
Vice President and General Counsel of GAMCO Investors, Inc. since 1993 and of
Gabelli Funds, Inc. since August 1995. Mr. McKee also serves as Secretary for
each mutual fund managed by the Investment Adviser and Teton Advisers LLC. From
1992 through 1993 Mr. McKee served as Branch Chief with the U.S. Securities and
Exchange Commission in New York. From 1989 through 1992 he served as a staff
attorney with the Securities and Exchange Commission in New York. The business
address of each of these officers is One Corporate Center, Rye, New York
10580-1434.
The following table sets forth certain information regarding the
compensation of the Equity Trust's directors and officers. Mr.
Diagonale is employed by the Equity Trust and is not employed by the
Investment Adviser. Officers of the Equity Trust who are employed by the
Investment Adviser receive no compensation or expense reimbursement from the
Equity Trust.
<PAGE>
<TABLE>
<CAPTION>
Compensation Table
Fiscal Year Ended December 31, 1996
Aggregate Total Compensation from the
Compensation from Equity Trust and Fund
Name of Person the Equity Trust Complex Paid to Directors
and Position and Officer*
<S> <C> <C>
Mario J. Gabelli $0 $0
Chairman of the Board
Dr. Thomas E. Bratter $15,500 $20,500 (2)
Director
Bill Callaghan $15,500 $34,500 (3)
Director
Felix J. Christiana $17,500 $74,000 (11)
Director
James P. Conn $15,500 $36,500 (5)
Director
Karl Otto Pohl $14,500 $77,750 (16)
Director
Anthony R. Pustorino $17,500 $84,500 (9)
Director
Salvatore J. Zizza $15,500 $42,500 (5)
Director
Marc S. Diagonale $125,000 $125,000 (1)
Vice President
<FN>
- ---------------
* Represents the total compensation paid to such persons during the calendar
year ended December 31, 1996 by investment companies (including the Equity
Trust) from which such person receives compensation that are considered part
of the same fund complex as the Equity Trust because they have common or
affiliated investment advisers. The number in parenthesis represents the
number of such investment companies.
</FN>
</TABLE>
Required Vote
In the election of Directors of the Equity Trust, those candidates
receiving the highest number of votes cast at the Meeting if a quorum is present
shall be elected to the three positions.
THE BOARD OF DIRECTORS, INCLUDING THE NON-INTERESTED DIRECTORS,
RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" THE PROPOSAL TO ELECT THREE
DIRECTORS OF THE EQUITY TRUST.
<PAGE>
PROPOSAL 2: TO RATIFY THE SELECTION OF PRICE WATERHOUSE LLP AS THE INDEPENDENT
ACCOUNTANTS OF THE EQUITY TRUST FOR
THE YEAR ENDING
DECEMBER 31, 1997
Upon recommendation by the Audit Committee, Price Waterhouse LLP, 1177
Avenue of the Americas, New York, New York, 10036, has been selected by the vote
of a majority of those Directors who are not "interested persons" of the Equity
Trust to serve as independent accountants for the Equity Trust's fiscal year
ending December 31, 1997. Price Waterhouse LLP has advised the Equity Trust that
it is independent with respect to the Equity Trust in accordance with the
applicable requirements of the American Institute of Certified Public
Accountants and the Securities and Exchange Commission (the "Commission").
Representatives of Price Waterhouse LLP are expected to be present at
the Meeting to answer appropriate questions and will be given the opportunity to
make a statement if they so desire.
Required Vote
Ratification of the selection of Price Waterhouse LLP as independent
accountants requires the affirmative vote of a majority of the votes cast by
holders of shares of the Equity Trust represented at the Meeting if a quorum is
present.
THE BOARD OF DIRECTORS, INCLUDING THE "NON-INTERESTED" DIRECTORS,
RECOMMENDS THAT THE SHAREHOLDERS VOTE "FOR" THE PROPOSAL TO RATIFY THE SELECTION
OF PRICE WATERHOUSE LLP AS THE INDEPENDENT ACCOUNTANTS OF THE EQUITY TRUST FOR
THE YEAR ENDING DECEMBER 31, 1997.
PROPOSAL 3: AMENDMENT TO THE EQUITY TRUST'S FUNDAMENTAL INVESTMENT
RESTRICTION REGARDING THE ISSUANCE OF SENIOR SECURITIES
The Equity Trust has adopted investment restrictions that govern its
operations generally. Fundamental investment restrictions may
not be changed without a vote of the outstanding shares of the Equity Trust
.
The proposed changes to the investment restrictions are designed to
provide the Equity Trust with greater investment flexibility, to promote
operational efficiencies and facilitate monitoring of compliance and to provide
greater opportunities to enhance performance for the common shareholders of the
Equity Trust. Shareholders should note that the proposed
fundamental investment restrictions are stated in terms of "to the extent
permitted by applicable law." Applicable law can change from time to time and
may become more or less restrictive as a result. The restriction has
been drafted in this manner so that future changes in the law would not require
the Equity Trust to seek shareholder approval to amend the restriction
to conform to applicable law then in effect.
The Equity Trust currently is prohibited from issuing senior securities
but is allowed to mortgage or pledge securities in connection with permissible
borrowings. The current restriction reads as follows: "The Fund may not issue
senior securities, as defined in the 1940 Act, or mortgage, pledge, hypothecate
or in any manner transfer, as security for indebtedness, any securities it owns
or holds except as may be necessary in connection with borrowings mentioned . .
. above, and then such mortgaging, pledging or hypothecating may not exceed 10%
of the total assets of the Fund taken at the lesser of cost or market value and
except that collateral arrangements with respect to the writing of options or
any other hedging activity shall not be deemed a pledge of assets or the
issuance of a senior security." The proposed restriction instead substitutes a
limitation on the issuance of senior securities based upon applicable law, as
follows: "The Fund may not issue senior securities, except to the extent
permitted by applicable law." The purpose of the proposed amendment is to ensure
that the Equity Trust's policy concerning senior securities affords it the
maximum ability to adapt to economic, market and regulatory conditions as they
arise.
Although the definition of "senior security" involves complex statutory
and regulatory concepts, a senior security is considered generally to be an
obligation of the Equity Trust that has a claim to the assets or earnings of the
Equity Trust that takes priority over the claims of holders of common stock of
the Equity Trust. The 1940 Act generally prohibits closed-end investment
companies such as the Equity Trust from issuing senior securities unless certain
asset coverage tests and other restrictions are satisfied.
The proposed amendment would enable the Equity Trust to issue
preferred stock whose holders would have priority over holders of the Equity
Trust's common shares as to distribution of assets or payment of dividends
. The Board of Directors has considerred certain preliminary matters
relating to a possible offering of preferred stock. If this proposal is
approved, the Board of Directors intends to consider more fully the
issuance of preferred stock, including the preferences, rights, powers
and restrictions thereof. If a preferred offering is approved, the
Investment Adviser does not intend to receive a management fee on the
incremental assets until the total return of the Equity Trust exceeds the coupon
rate of the preferred stock.
A leveraged capital structure creates certain special risks and
benefits not associated with unleveraged funds having similar investment
objectives and policies. If the Equity Trust were to issue preferred stock
and incur an obligation to pay dividends , any investment income or
gains earned from the capital contributed by the purchase of the senior
securities which is in excess of the dividends due thereon will cause
the net asset value of the Equity Trust's shares to increase to a greater extent
than would otherwise be the case. Conversely, if the investment performance of
the capital contributed by the purchasers of the senior securities fails to
cover the dividends on such capital, the net asset value of the Equity
Trust would decrease to a greater extent than would otherwise be the case, and
dividends on the shares from earnings may be reduced or eliminated. A leveraged
capital structure may be implemented only if the Board of Directors of the
Equity Trust determines in light of all relevant circumstances that to do so
would be in the best interests of the Equity Trust and its shareholders.
Required Vote
The proposed change to the Equity Trust's fundamental investment
restriction as set forth in proposal 3 requires the affirmative vote of
a majority of the outstanding voting securities of the Equity Trust which, as
defined in the 1940 Act, means the lesser of (a) 67% of the shares present at a
meeting of its shareholders if a quorum is present or (b) more than 50% of the
outstanding shares of the Equity Trust.
THE BOARD OF DIRECTORS, INCLUDING THE "NON-INTERESTED" DIRECTORS,
RECOMMENDS A VOTE "FOR" THE PROPOSAL TO AMEND THE EQUITY
TRUST'S FUNDAMENTAL INVESTMENT RESTRICTION REGARDING THE ISSUANCE OF SENOR
SECURITIES .
The Investment Adviser and Administrator
Gabelli Funds, Inc. acts as investment adviser and administrator to the Equity
Trust. The business address for Gabelli Funds, Inc. is One Corporate
Center, Rye, New York 10580-1434.
Compliance with the Securities Exchange Act of 1934
Section 16(a) of the Exchange Act and Section 30(f) of the 1940 Act and
the rules thereunder require the Equity Trust's officers and directors, officers
and directors of the investment adviser, affiliated persons of the investment
adviser, and persons who own more than ten percent of a registered class of the
Equity Trust's securities, to file reports of ownership and changes in ownership
with the Commission and the New York Stock Exchange and to furnish the Equity
Trust with copies of all Section 16(a) forms they file. Based solely on its
review of the copies of such forms received by it, the Equity Trust believes
that during 1996, such persons complied with all such applicable filing
requirements.
Broker Non-Votes and Abstentions
If a proxy which is properly executed and returned accompanied by
instructions to withhold authority to vote represents a broker "non-vote" (that
is, a proxy from a broker or nominee indicating that such person has not
received instructions from the beneficial owner or other person entitled to vote
shares on a particular matter with respect to which the broker or nominee does
not have discretionary power), is unmarked or marked with an abstention
(collectively, "abstentions"), the shares represented thereby will be considered
to be present at the Meeting for purposes of determining the existence of a
quorum for the transaction of business. Under Maryland law, abstentions do not
constitute a vote "for" or "against" a matter and will be disregarded in
determining the "votes cast" on an issue. The election of Directors (Proposal 1)
provides that the three candidates who receive the highest number of votes cast
at the meeting are elected; therefore, abstentions will be disregarded. The
ratification of Price Waterhouse LLP as independent accountants of the Equity
Trust (Proposal 2) requires the affirmative vote of a majority of the votes cast
at the Meeting; therefore, abstentions will be disregarded. The consideration of
the amendment of the fundamental investment restriction
regarding the issuance of senior securities (Proposal 3 ) requires
approval of a 1940 Act majority; therefore, abstentions and broker non-votes
have the effect of a negative vote on the proposal.
Shareholders of the Equity Trust will be informed of the voting results
of the Meeting in the Equity Trust's Semi-Annual Report dated June 30, 1997.
OTHER MATTERS TO COME BEFORE THE MEETING
The Directors do not intend to present any other business at the
Meeting, nor are they aware that any shareholder intends to do so. If, however,
any other matters are properly brought before the Meeting, the persons named in
the accompanying form of proxy will vote thereon in accordance with their
judgment.
SHAREHOLDER PROPOSALS
All proposals by shareholders of the Equity Trust, which are intended
to be presented at the Equity Trust's next Annual Meeting of Shareholders to be
held in 1998, must be received by the Equity Trust for consideration for
inclusion in the Equity Trust's proxy statement and proxy relating to that
meeting no later than December 4 , 1997.
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. SHAREHOLDERS WHO DO NOT
EXPECT TO ATTEND THE MEETING ARE THEREFORE URGED TO COMPLETE, SIGN, DATE AND
RETURN THE PROXY CARD AS SOON AS POSSIBLE IN THE ENCLOSED POSTAGE-PAID ENVELOPE.
<PAGE>
[x] PLEASE MARK VOTES AS IN THIS EXAMPLE
THE GABELLI EQUITY TRUST INC.
1.) To elect three Directors of Equity Trust.
With- For All
For hold Except
[ ) [ ] [ ]
James P. Conn, Anthony R. Pustorino, Karl Otto Pohl
NOTE:If you do not wish your shares voted "FOR" a particular regarding
borrowing nominee, mark the "For All Except" box and strike through the
nominee(s) name. Your shares will be voted for the remaining nominee(s).
For Against Abstain
2.) To ratify the selection of
Price Waterhouse LLP as the
independent accountants of ( ) [ ] [ ]
the Equity Trust for the year
ending December 31, 1997.
3.) TO approve the revision of the
fundamental investment restriction
regarding senior securities ( ) ( ) ( )
4.) To consider and vote upon such other matters as may come before
said Meeting or any adjournment thereof.
RECORD DATE SHARES:
Please be sure to sign and date this Proxy. Date
Mark box at right if an address change or comments have been
noted on the reverse side of this card. [ ]
Shareholder sign here Co-owner sign here.
<PAGE>
THE GABELLI EQUITY TRUST INC.
This proxy is solicited on behalf of the
Directors
The undersigned hereby appoints Mario J. Gabelli, Anthony R. Pustorino, Felix J.
Christiana and Bruce N. Alpert, and each of them, attorneys and proxies of the
undersigned, with full powers of substitution and revocation, to represent the
undersigned and to vote on behalf of the undersigned all shares of The Gabelli
Equity Trust Inc. (the "Equity Trust") which the undersigned is entitled to vote
at The Annual Meeting of Shareholders of the Equity Trust to be held at the Cole
Auditorium, Greenwich Public Library, 101 West Putnam Avenue, Greenwich,
Connecticut 06830 on May 12, 1997 at 9:30 a.m., and at any adjournments thereof.
The undersigned hereby acknowledges receipt of the Notice of Meeting and Proxy
Statement and hereby instructs said attorneys and proxies to vote said shares as
indicated herein. In their discretion, the proxies are authorized to vote upon
such other business as may properly come before the Meeting.
A majority of the proxies present and acting at the Meeting in person or by
substitute (or, if only one shall be so present, then that one) shall have
and may exercise all of the power and authority of said proxies hereunder.
The undersigned hereby revokes any proxy previously given.
This proxy, if properly executed, will be voted in the manner directed by the
undersigned shareholder. If no direction is made, this proxy will be voted FOR
election of the nominees as directors and FOR Proposals 2 and 3.
Please refer to the Proxy Statement for a discussion of the proposals.
PLEASE VOTE, DATE, AND SIGN ON OTHER SIDE AND RETURN PROMPTLY
IN ENCLOSED ENVELOPE. Please sign this proxy exactly as your name appears on the
books of the Equity Trust. If joint owners, either may sign. Trustees and other
fiduciaries should indicate the capacity in which they sign, and where more than
one name appears, a majority must sign. If a corporation, this signature should
be that of an authorized officer who should state his or her title.
HAS YOUR ADDRESS CHANGED? DO YOU HAVE ANY COMMENTS?
