Terms

Series

5.375% Series C Cumulative Preferred Shares

Liquidation Preference

$25.00

Coupon Rate

5.375%

Rate Type

Fixed

Annual Dividend

$1.34

Payment Frequency

Quarterly

Cumulative

Yes

Perpetual

Yes

Convertible

No

Callable

Yes

First Call Date

May 31, 2021

First Call Price

$25.00

Redemption Notice Period

15 days

Capital Stack Ranking

Junior To: Any Indebtedness Incurred By The Fund; Pari Passu With: Series A Preferred Shares, Series B Auction Market Preferred Shares, Any Future Series Of Preferred Shares; Senior To: Common Shares

Regulatory (Basel III) Call

Yes

Tax Classification

Other

Qualifies for QDI

Yes

Qualifies for DRD

Yes

Shares Offered

2,000,000

Prospectus Summary

The Gabelli Utility Trust (NYSE: GUT) is offering 2,000,000 shares of its 5.375% Series C Cumulative Preferred Shares at a $25.00 liquidation preference per share, with a first optional call date of May 31, 2021 at par. These are direct preferred shares (not depositary shares), paying a fixed annual dividend of 5.375% ($1.34375 per share, or approximately $0.336 per quarter) on March 26, June 26, September 26, and December 26 each year. The shares are cumulative, meaning any missed dividends accumulate and must be paid in full before common shareholders can receive any distributions. The Series C Preferred Shares rank senior to the Fund's common shares and pari passu with the existing Series A and Series B Preferred Shares with respect to dividends and liquidation. They are junior to any indebtedness of the Fund. As a closed-end fund subject to the 1940 Act, the Fund must maintain at least 200% asset coverage on all senior securities (preferred shares and debt); if this test is breached and not cured within 49 days, a mandatory redemption of sufficient preferred shares is triggered. Additionally, if Moody's-required Basic Maintenance Amount tests are breached and not cured within 10 business days, a similar mandatory redemption protocol applies. The Fund may also redeem these shares at any time before May 31, 2021 solely to preserve its regulated investment company tax status. At the $25.00 public offering price, the effective yield is 5.375%. Dividends are paid quarterly (March 26, June 26, September 26, December 26) to holders of record as of the fifth preceding business day. Distributions may include long-term capital gains, qualified dividend income (QDI) eligible for the 15%/20% preferential individual rate, and ordinary income; a portion may qualify for the corporate dividends-received deduction (DRD), though the Fund cannot guarantee the precise mix. If the Fund has not paid full cumulative dividends on all parity preferred series, no distributions may be made to common shareholders, and partial preferred payments must be allocated pro rata across all parity preferred series.

Summarized from the SEC prospectus filing.

Distribution History

Ranking vs. Other Preferreds

Dividend Stopper Provisions

Dividend Stopper Description

If the Fund has not paid full cumulative dividends on all outstanding preferred shares (including Series C), no dividends may be paid on common shares and any partial preferred distributions must be paid pro rata across all parity preferred series; additionally, no common share dividends or repurchases are permitted unless the Fund meets the 200% 1940 Act asset coverage requirement.

Div Score Breakdown

Reinvesty's multi-factor safety analysis for this preferred, composite score: 81 (Very Strong)