UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-5615
John Hancock Patriot Premium Dividend Fund I
(Exact name of registrant as specified in charter)
101 Huntington Avenue, Boston, Massachusetts 02199
(Address of principal executive offices) (Zip code)
Alfred P. Ouellette
Senior Attorney and Assistant Secretary
101 Huntington Avenue
Boston, Massachusetts 02199
(Name and address of agent for service)
Registrant's telephone number, including area code: 617-375-1513
Date of fiscal year end: September 30
Date of reporting period: March 31, 2005
ITEM 1. REPORT TO SHAREHOLDERS.
JOHN HANCOCK
Patriot Premium
Dividend Fund I
3.31.2005
Semiannual Report
[A 2" x 1" John Hancock (Signature)/John Hancock Funds logo in lower,
center middle of page. A tag line below reads "JOHN HANCOCK FUNDS."]
[A photo of James A. Shepherdson, Chief Executive Officer, flush left next
to first paragraph.]
CEO CORNER
Table of contents
Your fund at a glance
page 1
Managers' report
page 2
Fund's investments
page 6
Financial statements
page 10
For more information
page 25
Dear Fellow Shareholders,
After advancing for a second straight year in 2004, the stock market pulled
back in the first three months of 2005. For much of 2004 the market had been
in the doldrums as investors fretted about rising oil prices, higher
interest rates, the war in Iraq and a closely contested presidential race.
But the year ended on a high note with a sharp rally sparked by a definitive
end to the U.S. presidential election and moderating oil prices.
Investors were brought back down to earth in January, however, as the market
declined in three of the four weeks and produced negative results for the
month in a broad-based move downward. Rising oil prices and interest rates,
and concerns about less robust corporate earnings growth were among the
culprits that kept investors on the sidelines. Investors began to re-enter
the market in February, reversing January's decline. But as the quarter
progressed investors again grew concerned about further spikes in oil prices
and rising interest rates. As a result, the first quarter of 2005 ended with
the major indexes in the red. By the end of March, the Dow Jones Industrial
Average had returned -2.06%, the S&P 500 Index returned -2.15%, while the
Nasdaq Composite Index fell by 8.0%. Bonds were slightly less negative in
the first three months, with the Lehman Brothers Aggregate Bond Index
returning -0.48%.
The way the financial markets have been playing out recently serves as a
good reminder of why keeping a long-term perspective is such a critical
element of successful investing. Getting caught up in the day-to-day twists
and turns of the market -- and trying to act on them -- can wreak havoc with
your portfolio and derail progress toward meeting your overall financial
objectives.
Since no one can predict the market's moves, the best way to reach your
goals is to stay invested and stick to your plan. Investing should be a
marathon, not a sprint. Do not try to time the market, and make sure you
work with your investment professional to ensure that your portfolio remains
properly diversified to meet your long-term objectives. For example, after
several years of dominance, small-cap stocks and value stocks could now
represent higher percentages of your portfolio than you may want. If you are
comfortable with your financial plan, it becomes easier to ride out the
market's daily ups and downs. It could also provide you with a greater
chance of success over time.
Sincerely,
/S/ JAMES A. SHEPHERDSON
James A. Shepherdson,
Chief Executive Officer
This commentary reflects the CEO's views as of March 31, 2005. They are
subject to change at any time.
YOUR FUND
AT A GLANCE
The Fund seeks to
provide high current
income, consistent
with modest growth
of capital, for hold-
ers of its common
shares by investing
at least 80% of its
assets in dividend-
paying securities.
Over the last six months
* Despite rising interest rates, preferred stocks posted good gains in
response to strong demand, weak supply and hopes that dividend tax cuts would
be made permanent.
* The Fund benefited from good security selection, but lagged the Lipper peer
group average due to its focus on preferred stocks in a period when utility
commons outperformed.
* High quality, tax-advantaged preferred stocks and convertible securities
aided performance.
[Bar chart with heading "John Hancock Patriot Premium Dividend Fund I."
Under the heading is a note that reads "Fund performance for the six months
ended March 31, 2005." The chart is scaled in increments of 4% with 0% at
the bottom and 8% at the top. The first bar represents the Fund's 7.22% net
asset value and the second bar represents the Fund's 0.22% market value. A
note below the chart reads "The total returns for the Fund are with all
distributions reinvested. The performance data contained within this
material represents past performance, which does not guarantee future
results.
Top 10 issuers
7.7% NSTAR
5.6% Energy East Corp.
4.6% Lehman Brothers Holdings, Inc.
3.9% Baltimore Gas & Electric Co.
3.7% El Paso Tennessee Pipeline Co.
3.7% Sierra Pacific Power Co.
3.0% CH Energy Group, Inc.
2.7% DTE Energy Co.
2.7% South Carolina Electric & Gas Co.
2.6% Alabama Power Co.
As a percentage of net assets plus the value of preferred shares on March 31,
2005.
1
BY GREGORY K. PHELPS AND MARK T. MALONEY FOR THE PORTFOLIO
MANAGEMENT TEAM
MANAGERS'
REPORT
JOHN HANCOCK
Patriot Premium
Dividend Fund I
Dividend-paying securities encountered mixed conditions during the six-month
period ended March 31, 2005. Preferred stocks -- which are the primary
emphasis of John Hancock Patriot Premium Dividend Fund I -- performed
reasonably well from the beginning of the period last October through roughly
mid February 2005. Because preferreds make fixed payments in the form of
dividends, their prices tend to follow those of U.S. Treasury securities.
Despite evidence of a strengthening economy and additional short-term interest
rate hikes by the Federal Reserve Board, preferred stock prices generally
moved higher, mirroring a somewhat positive tone in the U.S. Treasury market.
That rally was based on investors' confidence that even though the Fed might
continue to raise rates, those rate hikes would be small and measured given
the potential for record high oil prices and higher interest rates themselves
to dampen economic growth. Preferred stocks were further boosted by the
combination of constrained supply and strong demand. Supply was muted, as
fewer companies issued new preferred securities, while others bought back
their outstanding shares. Demand was fueled by investors' appetite for yield,
particularly in light of the fact that changes in the tax code in 2003 helped
to make ownership of certain dividend-yielding stocks more attractive.
Investors also viewed the re-election of President George Bush as a positive
for tax-advantaged preferred stocks, because he vowed to make permanent the
2003 provisions that reduced the tax rate most individuals pay on many stock
dividends.
"Dividend-paying
securities encountered
mixed conditions during
the six-month period
ended March 31, 2005."
But from about mid-February through the end of the period on March 31, 2005,
preferred stocks weakened in response to a series of developments that
suggested further interest rate hikes were in the offing. These developments
included record-setting oil prices, stronger-than-expected data on the jobs
market and comments from the Fed that it had seen evidence of a pickup in
inflation.
2
Utility common stocks
Utility common stocks -- the Fund's other main focus -- also seesawed during
the period. They generally lagged the overall stock market in the fourth
quarter of 2004, as investors sought out companies with higher growth
prospects. But utility common stocks held their ground far better than
preferred and many other common-stock groups in the final weeks of the period.
Their resiliency was due to the combination of growing demand for their
tax-advantaged dividends and a perception that utility companies' financial
shape continued to improve.
[Photos of Greg Phelps and Mark Maloney flush right at top of page.]
Performance
For the six months ended March 31, 2005, John Hancock Patriot Premium Dividend
Fund I returned 7.22% at net asset value and 0.22% at market value. The
difference in the Fund's net asset value (NAV) performance and its market
performance stems from the fact that the market share price is subject to the
dynamics of secondary market trading, which could cause it to trade at a
discount or premium to the Fund's NAV share price at any time. By comparison,
the average income and preferred stock closed-end fund returned 5.50% at net
asset value, according to Lipper, Inc. In the same six-month period, the Dow
Jones Utility Average -- which tracks the performance of 15 electric and
natural gas utilities -- returned 23.59%, and the broader stock market as
measured by the Standard & Poor's 500 Index returned 6.88%.
"The strong demand for
tax-advantaged preferred holdings
helped support many of our hold
ings that sported that feature."
Tax-advantaged holdings among top performers
The strong demand for tax-advantaged preferred holdings helped support many of
our holdings that sported that feature. A good example was Baltimore Gas &
Electric Co., a regulated electric and gas public utility in central Maryland.
It also benefited from the fact that it carried a high coupon, which helped
cushion its price declines, and the fact that there is limited supply of this
high-quality holding. Southern Union Co. also enjoyed relatively good
performance for similar reasons. On the flip side, our fully taxable,
lower-coupon holdings in financial services company Morgan Stanley, proved
disappointing.
3
Oil and gas-related utility stocks also post strong results
Rising energy prices provided the fuel for improved company profitability and
higher prices for some of our holdings in utility common stocks involved with
oil and gas production. Among the best performers were our common-stock
holdings in Dominion Resources, one of the nation's largest producers of
energy. Other winners in this segment included National Fuel Gas Co., an
integrated natural gas company, and NiSource, Inc., which is engaged in
natural gas transmission, storage and distribution, as well as electric
generation, transmission and distribution. Among our preferred stock holdings
in this sector, we had strong performances from Anadarko Petroleum Corp.,
Apache Corp. and Devon Energy Corp.
[Table at top left-hand side of page entitled "Industry distribution1." The
first listing is Electric utilities 41%, the second is Multi-utilities &
unregulated power 19%, the third is Investment banking & brokerage 10%, the
fourth is Gas utilities 9%, the fifth is Oil & gas exploration & production
8%, the sixth is All other 5%, the seventh is Integrated oil & gas 3%, the
eighth is Broadcasting & cable TV 2%, the ninth is Agricultural products
1%, the tenth is Integrated telecommunication services 1% and the eleventh
is Diversified banks 1%.]
[Pie chart in middle of page with heading "Portfolio diversification1." The
chart is divided into three segments (from top to right): Preferred stocks
63%, Common stocks 34% and Short-term investments & other 3%.]
Outlook
In our view, the Fed probably hasn't yet reached the end of its campaign to
raise short-term interest rates to cool economic growth and potential
inflationary pressures. This could pose periodic short-term challenges for
dividend-producing securities. Over the longer term, however, we're more
upbeat, especially given the fact that we believe a good portion, if not all,
of future interest rate hikes already have been factored into preferred and
utility common stock prices. Furthermore, there are already some tangible
signs that economic growth has cooled as rates have moved higher. The housing
market has started to slow, with adjustable-rate mortgages moving higher and
conventional 30-year mortgages exceeding 6% at times. Higher oil prices will
also probably act as a drag on economic growth, most likely by reducing
consumers' disposable income and raising corporate America's cost of doing
business.
4
Another signal pointing to slack economic growth is the March job
numbers, which were lackluster at best. We believe that a slower-growth,
low-inflationary environment will provide a favorable backdrop for both
preferred and utility common stocks. That, coupled with what we believe will
continue to be a favorable supply and demand backdrop, should benefit many
dividend-paying securities in the months to come.
[Table at top of page entitled "Scorecard." The header for the left column
is "Investment" and the header for the right column is "Period's
performanceand what's behind the numbers." The first listing is Baltimore
Gas & Electric followed by an up arrow with the phrase "High yield helps
stock weather market decline." The second listing is Dominion Resources
followed by an up arrow with the phrase "High energy prices boost financial
performance." The third listing is Morgan Stanley followed by a down arrow
with the phrase "Low coupon offers little cushion against market selloff."]
"We believe that a slower-growth,
low-inflationary environment
will provide a favorable backdrop
for both preferred and utility
common stocks."
This commentary reflects the views of the team through the end of the Fund's
period discussed in this report. The managers' statements reflect their own
opinions. As such, they are in no way guarantees of future events and are not
intended to be used as investment advice or a recommendation regarding any
specific security. They are also subject to change at any time as market and
other conditions warrant.
The Fund normally will invest at least 25% of its managed assets in securities
of companies in the utilities industry. Such an investment concentration makes
the Fund more susceptible than a more broadly diversified fund to factors
adversely affecting the utilities industry. Sector investing is subject to
greater risks than the market as a whole.
1 As a percentage of the Fund's portfolio on March 31, 2005.
5
FINANCIAL STATEMENTS
FUND'S
INVESTMENTS
Securities owned
by the Fund on
March 31, 2005
(unaudited)
This schedule is divided into three main categories: common stocks, preferred
stocks, and short-term investments. The stocks are further broken down by
industry group. Short-term investments, which represent the Fund's cash
position, are listed last.
Issuer Shares Value
Common stocks 49.39% $72,453,429
(Cost $70,593,627)
Electric Utilities 32.01% 46,958,114
Alliant Energy Corp. 150,380 4,027,176
Ameren Corp. 45,900 2,249,559
CH Energy Group, Inc. 141,350 6,459,695
Consolidated Edison, Inc. 32,000 1,349,760
DTE Energy Co. 126,000 5,730,480
Great Plains Energy, Inc. 10,750 328,735
NSTAR 175,000 9,502,500
Progress Energy, Inc. 52,500 2,202,375
Progress Energy, Inc., (Contingent Value Obligation) (B)(I) 69,000 8,280
Puget Energy, Inc. 216,900 4,780,476
Sierra Pacific Resources (I) 246,600 2,650,950
TECO Energy, Inc. 173,000 2,712,640
WPS Resources Corp. 40,400 2,137,968
Xcel Energy, Inc. 164,000 2,817,520
Gas Utilities 5.89% 8,639,660
KeySpan Corp. 136,450 5,317,456
NiSource, Inc. 67,600 1,540,604
Peoples Energy Corp. 42,500 1,781,600
Integrated Telecommunication Services 0.89% 1,303,207
SBC Communications, Inc. 55,000 1,302,950
Touch America Holdings, Inc. (I) 151,000 257
See notes to
financial statements.
6
FINANCIAL STATEMENTS
Issuer Shares Value
Multi-Utilities & Unregulated Power 10.60% $15,552,448
Aquila, Inc. (I) 180,000 689,400
Dominion Resources, Inc. 64,300 4,785,849
Duke Energy Corp. 40,000 1,120,400
Energy East Corp. 257,000 6,738,540
National Fuel Gas Co. 47,150 1,348,019
Public Service Enterprise Group, Inc. 16,000 870,240
Credit
Issuer, description rating (A) Shares Value
Preferred stocks 92.75% $136,052,431
(Cost $135,617,143)
Agricultural Products 1.96% 2,871,096
Ocean Spray Cranberries, Inc., 6.25%, Ser A (S) BB+ 35,000 2,871,096
Broadcasting & Cable TV 3.17% 4,649,050
Shaw Communications, Inc., 8.50% (Canada) B+ 185,000 4,649,050
Consumer Finance 0.49% 711,750
SLM Corp., 6.97%, Ser A BBB+ 13,000 711,750
Diversified Banks 1.63% 2,386,764
Royal Bank of Scotland Group Plc, 5.75%, Ser L
(United Kingdom) A 100,200 2,386,764
Electric Utilities 27.88% 40,904,297
Alabama Power Co., 5.20% BBB+ 225,000 5,575,500
Boston Edison Co., 4.25% BBB+ 58,152 4,801,174
Boston Edison Co., 4.78% BBB+ 25,558 2,325,778
Duquesne Light Co., 6.50% BB+ 20,000 1,078,600
FPC Capital I, 7.10%, Ser A BB+ 70,700 1,780,226
Georgia Power Co., 6.00%, Ser R A 213,800 5,327,896
Great Plains Energy, Inc., 4.35% BB+ 23,638 1,857,947
Great Plains Energy, Inc., 4.50% BB+ 12,510 994,545
HECO Capital Trust III, 6.50% BBB- 45,000 1,143,450
Monongahela Power Co., $7.73, Ser L B- 34,500 3,432,750
PPL Electric Utilities Corp., 4.60% BBB 3,670 293,256
PSI Energy, Inc., 6.875% BBB- 37,000 3,794,350
Public Service Electric & Gas Co., 4.30%, Ser C BB+ 7,940 635,200
Sierra Pacific Power Co., 7.80%, Ser 1 (Class A) CCC+ 210,000 5,250,000
Virginia Electric & Power Co., $7.05 BBB- 10,200 1,062,075
Xcel Energy, Inc., $4.11, Ser D BB+ 20,150 1,551,550
See notes to
financial statements.
7
FINANCIAL STATEMENTS
Credit
Issuer, description rating (A) Shares Value
Gas Utilities 7.42% $10,889,273
El Paso Tennessee Pipeline Co., 8.25%, Ser A CCC- 156,400 7,903,095
Southern Union Co., 7.55% BB+ 111,800 2,986,178
Integrated Oil & Gas 3.62% 5,304,050
Coastal Finance I, 8.375% CCC- 215,000 5,304,050
Integrated Telecommunication Services 0.89% 1,307,100
Telephone & Data Systems, Inc., 6.625% A- 50,000 1,256,250
Touch America Holdings, Inc., $6.875 (I)(H) D 50,850 50,850
Investment Banking & Brokerage 15.29% 22,435,655
Bear Stearns Cos., Inc. (The), 5.49%,
Depositary Shares, Ser G BBB 25,000 1,263,750
Bear Stearns Cos., Inc. (The), 5.72%,
Depositary Shares, Ser F BBB 102,460 5,302,305
J.P. Morgan Chase & Co., 6.625%,
Depositary Shares, Ser H A- 72,000 3,758,400
Lehman Brothers Holdings, Inc., 5.67%,
Depositary Shares, Ser D BBB+ 102,700 5,135,000
Lehman Brothers Holdings, Inc., 5.94%,
Depositary Shares, Ser C BBB+ 90,400 4,678,200
Morgan Stanley Capital Trust V, 5.75% A1 100,000 2,298,000
Multi-Utilities & Unregulated Power 16.85% 24,721,264
Baltimore Gas & Electric Co., 6.99%, Ser 1995 Baa1 34,000 3,543,439
BGE Capital Trust II, 6.20% BBB- 190,000 4,873,500
Energy East Capital Trust I, 8.25% BBB- 200,000 5,240,000
PSEG Funding Trust II, 8.75% BB+ 70,000 1,919,400
Public Service Electric & Gas Co., 6.92% BB+ 26,800 2,782,175
South Carolina Electric & Gas Co., 6.52% Baa1 55,000 5,720,000
TECO Capital Trust I, 8.50% B 25,000 642,750
Oil & Gas Exploration & Production 11.95% 17,532,582
Anadarko Petroleum Corp., 5.46%,
Depositary Shares, Ser B BBB- 45,278 4,425,924
Apache Corp., 5.68%, Depositary Shares, Ser B BBB 25,000 2,573,438
Devon Energy Corp., 6.49%, Ser A BB+ 50,000 5,198,440
Nexen, Inc., 7.35% (Canada) BB+ 205,500 5,334,780
Regional Banks 1.60% 2,339,550
HSBC USA, Inc., $2.8575 A2 45,000 2,339,550
See notes to
financial statements.
8
FINANCIAL STATEMENTS
Interest Par value
Issuer, maturity date rate (000) Value
Short-term investments 4.30% $6,312,000
(Cost $6,312,000)
Commercial Paper 4.30% 6,312,000
ChevronTexaco Corp., 4-1-05 2.700% $6,312 6,312,000
Total investments 146.44% $214,817,860
Other assets and liabilities, net 0.32% $473,809
Fund preferred shares, at value (46.76%) ($68,593,236)
Total net assets 100.00% $146,698,433
(A) Credit ratings are unaudited and are rated by Moody's Investors Service
where Standard & Poor's ratings are not available.
(B) This security is fair valued in good faith under procedures established by
the Board of Trustees.
(H) Non-income-producing issuer filed for protection under the Federal
Bankruptcy Code or is in default of interest payment.
(I) Non-income-producing security.
(S) This security is exempt from registration under Rule 144A of the
Securities Act of 1933. Such security may be resold, normally to qualified
institutional buyers, in transactions exempt from registration. Rule 144A
securities amounted to $2,871,096 or 1.96% of the Fund's net assets as of
March 31,2005.
Parenthetical disclosure of a foreign country in the security description
represents country of a foreign issuer.
The percentage shown for each investment category is the total value of
that category as a percentage of the net assets of the Fund.
See notes to
financial statements.
9
FINANCIAL STATEMENTS
ASSETS AND
LIABILITIES
March 31, 2005
(unaudited)
This Statement
of Assets and
Liabilities is the
Fund's balance
sheet. It shows
the value of
what the Fund
owns, is due
and owes. You'll
also find the net
asset value for each
common share.
Assets
Investments, at value (cost $212,522,770) $214,817,860
Cash 573
Dividends receivable 710,679
Other assets 44,935
Total assets 215,574,047
Liabilities
Payable for investments purchased 51,000
Payable to affiliates
Management fees 166,568
Other 17,310
Other payables and accrued expenses 47,500
Total liabilities 282,378
Dutch Auction Rate Transferable Securities preferred
shares Series A (DARTS), at value, unlimited number
of shares of beneficial interest authorized with no par
value, 685 shares issued, liquidation preference of
$100,000 per share 68,593,236
Net assets
Common shares capital paid-in 143,247,170
Accumulated net realized gain on investments 541,438
Net unrealized appreciation of investments 2,295,090
Accumulated net investment income 614,735
Net assets applicable to common shares $146,698,433
Net asset value per common share
Based on 15,292,571 shares of beneficial interest
outstanding -- unlimited number of shares authorized
with no par value $9.59
See notes to
financial statements.
10
FINANCIAL STATEMENTS
OPERATIONS
For the period ended
March 31, 2005
(unaudited) 1
This Statement
of Operations
summarizes the
Fund's investment
income earned and
expenses incurred
in operating the
Fund. It also shows
net gains (losses)
for the period
stated.
Investment income
Dividends $6,087,567
Interest 81,335
Total investment income 6,168,902
Expenses
Investment management fees 844,142
Administration fees 107,139
DARTS auction fees 84,469
Federal excise tax 70,017
Miscellaneous 25,548
Custodian fees 22,723
Printing 20,995
Professional fees 20,388
Transfer agent fees 20,138
Registration and filing fees 11,404
Trustees' fees 5,676
Interest 116
Total expenses 1,232,755
Net investment income 4,936,147
Realized and unrealized gain
Net realized gain on investments 554,143
Change in net unrealized appreciation (depreciation)
of investments 5,460,740
Net realized and unrealized gain 6,014,883
Distributions to DARTS (722,778)
Increase in net assets from operations $10,228,252
1 Semiannual period from 10-1-04 through 3-31-05.
See notes to
financial statements.
11
FINANCIAL STATEMENTS
CHANGES IN
NET ASSETS
These Statements
of Changes in Net
Assets show how
the value of the
Fund's net assets
has changed
during the last
two periods. The
difference reflects
earnings less
expenses, any
investment
gains and losses,
distributions, if
any, paid to
shareholders and
the net of Fund
share transactions.
Year Period
ended ended
9-30-04 3-31-05 1
Increase (decrease) in net assets
From operations
Net investment income $9,789,851 $4,936,147
Net realized gain 66,438 554,143
Change in net unrealized
appreciation (depreciation) 8,308,808 5,460,740
Distributions to DARTS (836,184) (722,778)
Increase in net assets
resulting from operations 17,328,913 10,228,252
Distributions to common shareholders
From net investment income (10,919,843) (4,951,797)
From Fund share transactions 1,037,662 350,124
Net assets
Beginning of period 133,625,122 141,071,854
End of period 2 $141,071,854 $146,698,433
1 Semiannual period from 10-1-04 through 3-31-05. Unaudited.
2 Includes accumulated net investment income of $1,353,163 and $614,735,
respectively.
See notes to
financial statements.
12
FINANCIAL HIGHLIGHTS
FINANCIAL
HIGHLIGHTS
COMMON SHARES
The Financial Highlights show how the Fund's net asset value for a share has
changed since the end of the previous period.
Period ended 9-30-00 9-30-01 9-30-02 9-30-03 9-30-04 3-31-05 1
Per share operating performance
Net asset value,
beginning of period $9.91 $10.13 $9.74 $8.30 $8.82 $9.25
Net investment income 2 0.85 0.83 0.78 0.69 0.64 0.32
Net realized and unrealized
gain (loss) on investments 0.23 (0.39) (1.49) 0.54 0.56 0.39
Distributions to DARTS (0.21) (0.18) (0.08) (0.06) (0.05) (0.05)
Total from investment operations 0.87 0.26 (0.79) 1.17 1.15 0.66
Less distributions to
common shareholders
From net investment income (0.65) (0.65) (0.65) (0.65) (0.72) (0.32)
Net asset value, end of period $10.13 $9.74 $8.30 $8.82 $9.25 $9.59
Per share market value,
end of period $8.25 $8.75 $9.15 $9.24 $9.38 $9.09
Total return at market value 3 (%) 1.19 13.79 12.03 8.91 9.76 0.22 4
Ratios and supplemental data
Net assets applicable to common
shares, end of period (in millions) $152 $146 $125 $134 $141 $147
Ratio of expenses to average
net assets 5 (%) 1.75 1.72 1.79 1.90 1.70 1.69 6
Ratio of net investment income to
average net assets 7 (%) 8.94 8.35 8.42 8.33 7.06 6.76 6
Portfolio turnover (%) 19 23 11 10 16 5
Senior securities
Total value of DARTS outstanding
(in millions) $68 $68 $68 $69 $69 $69
Involuntary liquidation preference
per unit (in thousands) $100 $100 $100 $100 $100 $100
Average market value per unit
(in thousands) $100 $100 $100 $100 $100 $100
Asset coverage per unit 8 $315,176 $318,208 $280,462 $287,811 $304,418 $315,510
See notes to
financial statements.
13
FINANCIAL HIGHLIGHTS
Notes to Financial Highlights
1 Semiannual period from 10-1-04 through 3-31-05. Unaudited.
2 Based on the average of the shares outstanding.
3 Assumes dividend reinvestment.
4 Not annualized.
5 Ratios calculated on the basis of expenses relative to the average net
assets of common shares. Without the exclusion of preferred shares, the
annualized ratio of expenses would have been 1.18%, 1.18%, 1.20%, 1.23%,
1.14% and 1.15%, respectively.
6 Annualized.
7 Ratios calculated on the basis of net investment income relative to the
average net assets of common shares. Without the exclusion of preferred
shares, the annualized ratio of net investment income would have been 6.03%,
5.72%, 5.65%, 5.39%, 4.73% and 4.61%, respectively.
8 Calculated by subtracting the Fund's total liabilities from the Fund's
total assets and dividing such amount by the number of DARTS outstanding as
of the applicable 1940 Act Evaluation Date, which may differ from the
financial reporting date.
See notes to
financial statements.
14
NOTES TO
STATEMENTS
Unaudited
Note A
Accounting policies
John Hancock Patriot Premium Dividend Fund I (the "Fund") is a diversified
closed-end management investment company registered under the Investment
Company Act of 1940.
Significant accounting policies
of the Fund are as follows:
Valuation of investments
Securities in the Fund's portfolio are valued on the basis of market
quotations, valuations provided by independent pricing services or at fair
value as determined in good faith in accordance with procedures approved by
the Trustees. Short-term debt investments, which have a remaining maturing of
60 days or less may be valued at amortized cost which approximates market
value. The Fund determines the net asset value of the common shares each
business day.
Investment transactions
Investment transactions are recorded as of the date of purchase, sale or
maturity. Net realized gains and losses on sales of investments are determined
on the identified cost basis.
Expenses
The majority of the expenses are directly identifiable to an individual fund.
Expenses that are not readily identifiable to a specific fund are allocated in
such a manner as deemed equitable, taking into consideration, among other
things, the nature and type of expense and the relative sizes of the funds.
Federal income taxes
The Fund qualifies as a "regulated investment company" by complying with the
applicable provisions of the Internal Revenue Code and will not be subject to
federal income tax on taxable income that is distributed to shareholders.
Therefore, no federal income tax provision is required.
Dividends, interest
and distributions
Dividend income on investment securities is recorded on the ex-dividend date
or, in the case of some foreign securities, on the date thereafter when the
Fund identifies the dividend. Interest income on investment securities is
recorded on the accrual basis. The Fund may place a security on non-accrual
status and reduce related investment income by ceasing current accruals or
writing off interest, or dividends receivable, when the collection of income
has become doubtful. Foreign income may be subject to foreign withholding
taxes, which are accrued as applicable.
The Fund records distributions to shareholders from net investment income and
net realized gains, if any, on the ex-dividend date. During the year ended
September 30, 2004, the tax character of distributions paid was as follows:
ordinary income $11,756,027.
Such distributions, on a tax basis, are determined in conformity with income
tax regulations, which may differ from accounting principles generally
accepted in
15
the United States of America. Distributions in excess of tax basis earnings
and profits, if any, are reported in the Fund's financial statements as a
return of capital.
Use of estimates
The preparation of these financial statements, in accordance with accounting
principles generally accepted in the United States of America, incorporates
estimates made by management in determining the reported amount of assets,
liabilities, revenues and expenses of the Fund. Actual results could differ
from these estimates.
Note B
Management fee and
transactions with
affiliates and others
The Fund has an investment management contract with John Hancock Advisers, LLC
(the "Adviser"), a wholly owned subsidiary of John Hancock Financial Services,
Inc. Under the investment management contract, the Fund pays a monthly
management fee to the Adviser at an annual rate of 0.50% of the Fund's average
weekly net asset value and the value attributable to the Dutch Auction Rate
Transferable Securities preferred shares (collectively, managed assets"), plus
5.00% of the Fund's weekly gross income. The Adviser's total fee is limited to
a maximum amount equal to 1.00% annually of the Fund's average weekly managed
assets. For the period ended March 31, 2005, the advisory fee incurred did not
exceed the maximum advisory fee allowed.
The Fund has an administrative agreement with the Adviser under which the
Adviser oversees the custodial, auditing, valuation, accounting, legal, stock
transfer and dividend disbursing services and maintains Fund communications
with shareholders. The Fund pays the Adviser a monthly administration fee at
an annual rate of 0.10% of the Fund's average weekly managed assets. The
compensation for the period amounted to $107,139. The Fund also paid the
Adviser the amount of $1,120 for certain publishing services, included in the
printing fees.
Mr. James A. Shepherdson is a director and officer of the Adviser, as well as
affiliated Trustee of the Fund, and is compensated by the Adviser. The
compensation of unaffiliated Trustees is borne by the Fund. The unaffiliated
Trustees may elect to defer for tax purposes their receipt of this
compensation under the John Hancock Group of Funds Deferred Compen sation
Plan. The Fund makes investments into other John Hancock funds, as applicable,
to cover its liability for the deferred compensation. Investments to cover the
Fund's deferred compensation liability are recorded on the Fund's books as an
other asset. The deferred compensation liability and the related other asset
are always equal and are marked to market on a periodic basis to reflect any
income earned by the investments, as well as any unrealized gains or losses.
The Deferred Compensation Plan investments had no impact on the operations of
the Fund.
16
Note C
Fund share transactions
This listing illustrates the Fund's common shares, dividend reinvestments,
reclassification of the Fund's capital accounts and the number of common
shares outstanding at the beginning and end of the last two periods, along
with the corresponding dollar value.
Year ended 9-30-04 Period ended 3-31-05 1
Shares Amount Shares Amount
Beginning of period 15,142,247 $141,943,091 15,255,559 $142,897,046
Dividends reinvested 113,312 1,037,662 37,012 350,124
Reclassification of capital accounts -- (83,707) -- --
End of period 15,255,559 $142,897,046 15,292,571 $143,247,170
1 Semiannual period from 10-1-04 through 3-31-05. Unaudited.
Dutch Auction Rate
Transferable Securities
preferred shares Series A
The Fund issued 685 shares of Dutch Auction Rate Transferable Securities
preferred shares Series A ("DARTS") in a public offering. The underwriting
discount was recorded as a reduction of the capital of common shares.
Dividends on the DARTS, which accrue daily, are cumulative at a rate that was
established at the offering of the DARTS and has been reset every 49 days
thereafter by an auction. Dividend rates on DARTS ranged from 1.64% to 2.45%
during the period ended March 31, 2005. Accrued dividends on DARTS are
included in the value of DARTS on the Fund's Statement of Assets and
Liabilities.
The DARTS are redeemable at the option of the Fund, at a redemption price
equal to $100,000 per share, plus accumulated and unpaid dividends on any
dividend payment date. The DARTS are also subject to mandatory redemption at a
redemption price equal to $100,000 per share, plus accumulated and unpaid
dividends, if the Fund is in default on its asset coverage requirements with
respect to the DARTS, as defined in the Fund's by-laws. If the dividends on
the DARTS shall remain unpaid in an amount equal to two full years dividends,
the holders of the DARTS, as a class, have the right to elect a majority of
the Board of Trustees. In general, the holders of the DARTS and the common
shareholders have equal voting rights of one vote per share, except that the
holders of the DARTS, as a class, vote to elect two members of the Board of
Trustees, and separate class votes are required on certain matters that affect
the respective interests of the DARTS and common shareholders.
Note D
Investment
transactions
Purchases and proceeds from sales of securities, other than short-term
securities and obligations of the U.S. government, during the period ended
March 31, 2005, aggregated $9,921,106 and $9,372,404, respectively.
The cost of investments owned on March 31, 2005, including short-term
investments, for federal income tax purposes, was $212,546,155. Gross
unrealized appreciation and depreciation of investments aggregated $19,199,764
and $16,928,059, respectively, resulting in net unrealized appreciation of
$2,271,705. The difference between book basis and tax basis net unrealized
appreciation of investments is attributable primarily to the tax deferral of
losses on certain sales of securities.
17
Investment
objective
and policy
The Fund's investment objective is to provide a high current income consistent
with modest growth of capital for holders of its common shares of beneficial
interest. The Fund will pursue its objective by investing in a diversified
portfolio of dividend-paying preferred and common stocks.
The Fund's non-fundamental investment policy with respect to the quality of
ratings of its portfolio investments, which was changed by a vote of the
Fund's Trustees on September 13, 1994 and became effective October 15, 1994,
stipulates that preferred stocks and debt obligations in which the Fund will
invest will be rated investment-grade (at least "BBB" by S&P or "Baa" by
Moody's) at the time of investment or will be preferred stocks of issuers of
investment-grade senior debt, some of which may have speculative
characteristics, or, if not rated, will be of comparable quality as
determined by the Adviser. The Fund will invest in common stocks of issuers
whose senior debt is rated investment-grade or, in the case of issuers that
have no rated senior debt outstanding, whose senior debt is considered by
the Adviser to be of comparable quality.
This revised policy supersedes the requirement that at least 80% of the Fund's
total assets consist of preferred stocks and debt obligations rated "A" or
higher and dividend-paying common stocks whose issuers have senior debt rated
"A" or higher.
On November 20, 2001, the Fund's Trustees approved the following investment
policy investment restriction change, effective December 15, 2001. Under
normal circumstances, the Fund will invest at least 80% of its assets in
dividend-paying securities. The "Assets" are defined as net assets, including
the liquidation preference amount of the DARTS, plus borrowings for investment
purposes. The Fund will notify shareholders at least 60 days prior to any
change in this 80% investment policy.
By-laws
In November 2002, the Board of Trustees adopted several amendments to the
Fund's by-laws, including provisions relating to the calling of a special
meeting and requiring advance notice of shareholder proposals or nominees for
Trustee. The advance notice provisions in the by-laws require shareholders to
notify the Fund in writing of any proposal that they intend to present at an
annual meeting of shareholders, including any nominations for Trustee, between
90 and 120 days prior to the first anniversary of the mailing date of the
notice from the prior year's annual meeting of shareholders. The notification
must be in the form prescribed by the by-laws. The advance notice provisions
provide the Fund and its Trustees with the opportunity to thoughtfully
consider and address the matters proposed before the Fund prepares and mails
its proxy statement to shareholders. Other amendments set forth the procedures
that must be followed in order for a shareholder to call a special meeting of
shareholders. Please contact the Secretary of the Fund for additional
information about the advance notice requirements or the other amendments to
the by-laws.
On December 16, 2003, the Trustees approved the following change to the
Fund's by-laws. The auction preferred section of the Fund's by-laws was
changed to update the rating agency requirements, in keeping with recent
changes to the agencies' basic maintenance reporting requirements for
leveraged closed-end funds. By-laws now require an independent accountant's
confirmation only once per year, at the Fund's fiscal year end, and changes
to the agencies' basic maintenance reporting requirements that include
modifications to
18
the eligible assets and their respective discount factors. These revisions
bring the Fund's by-laws in line with current rating agency requirements.
On September 14, 2004, the Trustees approved an amendment to the Fund's
by-laws increasing the maximum applicable dividend rate ceiling on the
preferred shares to conform with the modern calculation methodology used by
the industry and other John Hancock funds.
Dividend
reinvestment plan
The Fund offers its shareholders a Dividend Rein vestment Plan (the "Plan"),
which offers the opportunity to earn compounded yields. Each holder of common
shares will automatically have all distributions of dividends and capital
gains reinvested by Mellon Investor Services, as Plan agent for the common
shareholders (the "Plan Agent"), unless an election is made to receive cash.
Holders of common shares who elect not to participate in the Plan will receive
all distributions in cash, paid by check mailed directly to the shareholder of
record (or if the common shares are held in street or other nominee name, then
to the nominee) by the Plan Agent, as dividend-disbursing agent. Shareholders
whose shares are held in the name of a broker or a nominee should contact the
broker or nominee to determine whether and how they may participate in the
Plan.
If the Fund declares a dividend payable either in common shares or in cash,
non-participants will receive cash and participants in the Plan will receive
the equivalent in common shares. If the market price of the common shares on
the payment date of the dividend is equal to or exceeds their net asset value
as determined on the payment date, participants will be issued common shares
(out of authorized but unissued shares) at a value equal to the higher of net
asset value or 95% of the market price. If the net asset value exceeds the
market price of the common shares at such time, or if the Board of Trustees
declares a dividend payable only in cash, the Plan Agent will, as agent for
Plan participants, buy shares in the open market, on the New York Stock
Exchange or elsewhere, for the participant's accounts. Such purchases will be
made promptly after the payable date for such dividend and, in any event,
prior to the next ex-dividend date after such date, except where necessary to
comply with federal securities laws. If, before the Plan Agent has completed
its purchases, the market price exceeds the net asset value of the common
shares, the average per share purchase price paid by the Plan Agent may exceed
the net asset value of the common shares, resulting in the acquisition of
fewer shares than if the dividend had been paid in shares issued by the Fund.
Each participant will pay a pro rata share of brokerage commissions incurred
with respect to the Plan Agent's open market purchases in connection with the
reinvestment of dividends and distributions. The cost per share of the shares
purchased for each participant's account will be the average cost, including
brokerage commissions, of any shares purchased on the open market plus the
cost of any shares issued by the Fund. There will be no brokerage charges with
respect to common shares issued directly by the Fund. There are no other
charges to participants for reinvesting dividends or capital gain
distributions.
Participants in the Plan may withdraw from the Plan at any time by contacting
the Plan Agent by telephone, in writing or by visiting the Plan Agent's Web
site at www.melloninvestor.com. Such withdrawal will be effective immediately
if received prior to a dividend record date; otherwise, it will be effective
for all subsequent dividend record dates. When a participant withdraws from
the Plan or upon termination of the Plan, as provided below, certificates
19
for whole common shares credited to his or her account under the Plan will
be issued and a cash payment will be made for any fraction of a share
credited to such account.
The Plan Agent maintains each shareholder's account in the Plan and furnishes
monthly written confirmations of all transactions in the accounts, including
information needed by the shareholders for personal and tax records. The Plan
Agent will hold common shares in the account of each Plan participant in
non-certificated form in the name of the participant. Proxy material relating
to the shareholders' meetings of the Fund will include those shares purchased,
as well as shares held pursuant to the Plan.
The reinvestment of dividends and distributions will not relieve participants
of any federal income tax that may be payable or required to be withheld on
such dividends or distributions. Participants under the Plan will receive tax
information annually. The amount of dividend to be reported on 1099-DIV should
be: (1) in the case of shares issued by the Fund, the fair market value of
such shares on the dividend payment date and (2) in the case of shares
purchased by the Plan Agent in the open market, the amount of cash used by the
Plan Agent to purchase shares in the open market, including the amount of cash
allocated to brokerage commissions paid on such purchases.
Experience under the Plan may indicate that changes are desirable.
Accordingly, the Fund reserves the right to amend or terminate the Plan as
applied to any dividend or distribution paid subsequent to written notice of
the change sent to all shareholders of the Fund at least 90 days before the
record date for the dividend or distribution. The Plan may be amended or
terminated by the Plan Agent after at least 90 days written notice to all
shareholders of the Fund. All correspondence or additional information
concerning the Plan should be directed to the Plan Agent, Mellon Bank, N.A.,
c/o Mellon Investor Services, P.O. Box 3338, South Hackensack, NJ 07606-1938
(telephone 1-800-852-0218).
Shareholder
communication
and assistance
If you have any questions concerning the Fund, we will be pleased to assist
you. If you hold shares in your own name and not with a brokerage firm, please
address all notices, correspondence, questions or other communications
regarding the Fund to the transfer agent at:
Mellon Investor Services
85 Challenger Road
Overpeck Centre
Ridgefield Park, NJ 07660
Telephone 1-800-852-0218
If your shares are held with a brokerage firm, you should contact that firm,
bank or other nominee for assistance.
20
Shareholder meeting
On March 7, 2005, the Annual Meeting of the Fund was held to elect four
Trustees and to ratify the actions of the Trustees in selecting independent
auditors for the Fund.
Proxies covering 12,639,827 shares of beneficial interest were voted at the
meeting. The common shareholders elected the following Trustees to serve until
their respective successors are duly elected and qualified, with the votes
tabulated as follows:
WITHHELD
FOR AUTHORITY
----------------------------------------------------------------------
James F. Carlin 12,410,128 229,277
William H. Cunningham 12,386,478 252,927
Richard P. Chapman, Jr. 12,378,089 261,316
James A. Shepherdson 12,406,742 232,663
The preferred shareholders elected Patti McGill Peterson as a Trustee of the
Fund until her successor is duly elected and qualified, with the votes
tabulated as follows: 422 FOR, 0 AGAINST and 0 ABSTAINING.
The common and preferred shareholders also ratified the Trustees' selection of
Deloitte & Touche LLP as the Fund's independent auditors for the fiscal year
ending September 30, 2005, with the votes tabulated as follows: 12,452,836
FOR, 79,986 AGAINST and 107,005 ABSTAINING.
21
22
23
24
For more information
The Fund's proxy voting policies, procedures and records are available
without charge, upon request:
By phone On the Fund's Web site On the SEC's Web site
1-800-225-5291 www.jhfunds.com/proxy www.sec.gov
Trustees
Charles L. Ladner, Chairman*
James F. Carlin
Richard P. Chapman, Jr.*
William H. Cunningham
Ronald R. Dion
Dr. John A. Moore*
Patti McGill Peterson*
Steven R. Pruchansky
James A. Shepherdson
Lt. Gen. Norman H. Smith,
USMC (Ret.)
* Members of the Audit Committee
Officers
James A. Shepherdson
President and
Chief Executive Officer
William H. King
Vice President and Treasurer
Investment adviser
John Hancock Advisers, LLC
101 Huntington Avenue
Boston, MA 02199-7603
Custodian
The Bank of New York
One Wall Street
New York, NY 10286
Transfer agent and
dividend disburser
Mellon Investor Services
85 Challenger Road
Overpeck Centre
Ridgefield Park, NJ 07660
Transfer agent for DARTS
Deutsche Bank Trust
Company Americas
280 Park Avenue
New York, NY 10017
Legal counsel
Wilmer Cutler Pickering
Hale and Dorr LLP
60 State Street
Boston, MA 02109-1803
Stock symbol
Listed New York Stock
Exchange:
PDF
For shareholder assistance
refer to page 20
How to contact us
Internet www.jhfunds.com
Mail Regular mail:
Mellon Investor Services
85 Challenger Road
Overpeck Centre
Ridgefield Park, NJ 07660
Phone Customer service representatives 1-800-852-0218
Portfolio commentary 1-800-344-7054
24-hour automated information 1-800-843-0090
TDD line 1-800-231-5469
A listing of month-end portfolio holdings is available on our Web site,
www.jhfunds.com. A more detailed portfolio holdings summary is available on a
quarterly basis 60 days after the fiscal quarter on our Web site or upon
request by calling 1-800-225-5291, or on the Securities and Exchange
Commission's Web site, www.sec.gov.
25
[A 1 1/2" x 1/2" John Hancock (Signature) logo in upper left hand corner.
A tag line below reads "JOHN HANCOCK FUNDS."]
1-800-852-0218
1-800-843-0090 EASI-Line
1-800-231-5469 (TDD)
www.jhfunds.com
---------------
PRESORTED
STANDARD
U. S. POSTAGE
PAID
MIS
---------------
P10SA 3/05
5/05
ITEM 2. CODE OF ETHICS.
As of the end of the period, March 31, 2005, the registrant has adopted a
code of ethics, as defined in Item 2 of Form N-CSR, that applies to its
Chief Executive Officer, Chief Financial Officer and Treasurer
(respectively, the principal executive officer, the principal financial
officer and the principal accounting officer, the "Senior Financial
Officers"). A copy of the code of ethics is filed as an exhibit to this
Form N-CSR.
The code of ethics was amended effective February 1, 2005 to address new
Rule 204A-1 under the Investment Advisers Act of 1940 and to make other
related changes.
The most significant amendments were:
(a) Broadening of the General Principles of the code to cover compliance
with all federal securities laws.
(b) Eliminating the interim requirements (since the first quarter of 2004)
for access persons to preclear their personal trades of John Hancock mutual
funds. This was replaced by post-trade reporting and a 30 day hold
requirement for all employees.
(c) A new requirement for "heightened preclearance" with investment
supervisors by any access person trading in a personal position worth
$100,000 or more.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable at this time.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable at this time.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable at this time.
ITEM 6. SCHEDULE OF INVESTMENTS.
Not applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
(a) The registrant has adopted procedures by which shareholders may
recommend nominees to the registrant's Board of Trustees. A copy of the
procedures is filed as an exhibit to this Form N-CSR. See attached
"John Hancock Funds - Administration Committee Charter" and "John Hancock
Funds - Governance Committee Charter".
ITEM 11. CONTROLS AND PROCEDURES.
(a) Based upon their evaluation of the registrant's disclosure controls and
procedures as conducted within 90 days of the filing date of this Form
N-CSR, the registrant's principal executive officer and principal financial
officer have concluded that those disclosure controls and procedures
provide reasonable assurance that the material information required to be
disclosed by the registrant on this report is recorded, processed,
summarized and reported within the time periods specified in the Securities
and Exchange Commission's rules and forms.
(b) There were no changes in the registrant's internal control over
financial reporting that occurred during the registrant's most recent
fiscal half-year (the registrant's second fiscal half-year in the case of
an annual report) that have materially affected, or are reasonably likely
to materially affect, the registrant's internal control over financial
reporting.
ITEM 12. EXHIBITS.
(a)(1) Code of Ethics for Senior Financial Officers is attached.
(a)(2) Separate certifications for the registrant's principal executive
officer and principal financial officer, as required by Section 302 of the
Sarbanes-Oxley Act of 2002 and Rule 30a-2(a) under the Investment Company
Act of 1940, are attached.
(b) Separate certifications for the registrant's principal executive
officer and principal financial officer, as required by 18 U.S.C. Section
1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
and Rule 30a-2(b) under the Investment Company Act of 1940, are attached.
The certifications furnished pursuant to this paragraph are not deemed to
be "filed" for purposes of Section 18 of the Securities Exchange Act of
1934, or otherwise subject to the liability of that section. Such
certifications are not deemed to be incorporated by reference into any
filing under the Securities Act of 1933 or the Securities Exchange Act of
1934, except to the extent that the Registrant specifically incorporates
them by reference.
(c)(1) Submission of Matters to a Vote of Security Holders is attached. See
attached "John Hancock Funds - Administration Committee Charter" and "John
Hancock Funds - Governance Committee Charter".
(c)(2) Contact person at the registrant.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.
John Hancock Patriot Premium Dividend Fund I
By:
------------------------------
James A. Shepherdson
President and Chief Executive Officer
Date: May 25, 2005
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on
the dates indicated.
By:
------------------------------
James A. Shepherdson
President and Chief Executive Officer
Date: May 25, 2005
By:
------------------------------
William H. King
Vice President and Treasurer
Date: May 25, 2005