Terms

Series

5.25% Series A Cumulative Preferred Shares

Liquidation Preference

$25.00

Coupon Rate

5.25%

Rate Type

Fixed

Annual Dividend

$1.31

Payment Frequency

Quarterly

Cumulative

Yes

Perpetual

Yes

Convertible

No

Callable

Yes

First Call Date

September 18, 2022

First Call Price

$25.00

Redemption Notice Period

15 days

Capital Stack Ranking

Junior To: All Indebtedness And Creditor Claims Of The Fund; Pari Passu With: Any Future Series Of Preferred Shares Of The Fund; Senior To: Common Shares

Regulatory (Basel III) Call

Yes

Tax Classification

Other

Shares Offered

1,200,000

Prospectus Summary

Ellsworth Growth and Income Fund Ltd. (NYSE American: ECF), a diversified closed-end management investment company managed by Gabelli Funds, LLC, is issuing 1,200,000 shares of its 5.25% Series A Cumulative Preferred Shares at a $25.00 liquidation preference, generating $1.3125 per share annually paid quarterly on March 26, June 26, September 26, and December 26, commencing December 26, 2017. The shares are not callable until September 18, 2022, after which the Fund may redeem at $25.00 plus accrued dividends. These are cumulative preferred shares, meaning any missed dividend payments accumulate and must be paid in full before the Fund can resume distributions to common shareholders. The Series A Preferred Shares rank senior to the Fund's common shares and on parity with any future preferred shares with respect to dividends and liquidation. They are junior to all indebtedness and creditor claims of the Fund, consistent with their equity (not debt) nature. There is a meaningful regulatory call risk: prior to September 18, 2022, the Fund may redeem shares if needed to preserve its RIC status, and mandatory redemption is triggered if the Fund's asset coverage falls below 200% (per 1940 Act requirements) or below rating agency Basic Maintenance Amount thresholds and such failure is not cured within the applicable cure period. At issuance, estimated asset coverage was approximately 539%, providing significant cushion. At the $25.00 offering price, the effective yield is 5.25%, with quarterly payments of approximately $0.328125 per share. Record dates fall on the fifth preceding business day before each payment date. Because the Fund is a RIC (closed-end fund investing primarily in convertible securities), the tax character of dividends depends on the Fund's underlying income; investors should consult the Fund's SAI for details on whether distributions will qualify for the preferential 15%/20% QDI rate or the corporate dividends-received deduction. Dividend payments can be interrupted if cumulative arrearages exist on any parity preferred shares, or if the Fund fails to meet the 1940 Act's 200% asset coverage requirement, which would block common dividends and could trigger mandatory redemption of the preferred shares themselves.

Summarized from the SEC prospectus filing.

Distribution History

Ranking vs. Other Preferreds

Dividend Stopper Provisions

Dividend Stopper Description

If full cumulative dividends on the Series A Preferred Shares (and any parity preferred shares) have not been paid, no dividends or distributions may be declared or paid on the Fund's common shares or any other junior shares; additionally, the 1940 Act requires 200% asset coverage before the Fund can pay dividends on common shares.

Div Score Breakdown

Reinvesty's multi-factor safety analysis for this preferred, composite score: 75 (Strong)