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SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
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[ ] Preliminary Proxy Statement
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[X] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
[ ] Confidential, for the Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
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THE LATIN AMERICA DOLLAR INCOME FUND, INC
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement)
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:
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(2) Aggregate number of securities to which transaction applies:
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(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):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] 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:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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IMPORTANT NEWS
SEPTEMBER 1997
FOR THE LATIN AMERICA DOLLAR INCOME FUND, INC. AND SCUDDER WORLD INCOME
OPPORTUNITIES FUND, INC. STOCKHOLDERS
While we encourage you to read the full text of the enclosed proxy
statement, here's a brief overview of some changes affecting both The Latin
America Dollar Income Fund, Inc. ("LADIF") and Scudder World Income
Opportunities Fund, Inc. ("SWIOF") that require a stockholder vote.
Q & A: QUESTIONS AND ANSWERS
Q. WHAT IS HAPPENING?
A. SWIOF proposes to transfer substantially all of its assets and liabilities
to LADIF in exchange for shares of LADIF (the "Reorganization"). LADIF is
another fund that seeks high income from investing in debt securities of
issuers in developing countries. LADIF, like SWIOF, is managed by Scudder,
Stevens & Clark, Inc. ("Scudder"). To be effective, the Reorganization must
be approved by each Fund's stockholders.
Also, Scudder, your Fund's investment manager, has agreed to form an
alliance with Zurich Insurance Company ("Zurich"). Zurich is a leading
international insurance and financial services organization. As a result of
the proposed alliance, there will be a change in ownership of Scudder. In
order for Scudder to continue to serve as investment manager of your Fund,
it is necessary for the Fund's stockholders to approve a new investment
management agreement.
The following pages give you additional information on the proposed
Reorganization of SWIOF and LADIF as well as on the Scudder-Zurich alliance,
the proposed new investment management agreement and certain other matters.
THE BOARD MEMBERS OF YOUR FUND, INCLUDING THOSE WHO ARE NOT AFFILIATED WITH
THE FUND OR SCUDDER, RECOMMEND THAT YOU VOTE FOR THESE PROPOSALS.
THE REORGANIZATION
Q. WHY AM I BEING ASKED TO VOTE ON THE PROPOSED REORGANIZATION OF THE FUNDS?
A. Maryland corporate law requires a vote of the acquired fund -- in this case
SWIOF -- whenever two funds are going to combine in the manner contemplated
by the Reorganization. In addition, The New York Stock Exchange requires
LADIF stockholders to approve the issuance of shares to be exchanged for
current SWIOF shares in the Reorganization. LADIF stockholders will also
consider a change to one of the Fund's investment policies and changing its
name to Scudder Global High Income Fund, Inc.
Q. HOW WILL THE REORGANIZATION AFFECT ME AS A SWIOF STOCKHOLDER?
A. The assets and liabilities of your Fund will be transferred to LADIF, and
you will receive shares of LADIF Common Stock in exchange for your shares of
SWIOF Common Stock. After the Reorganization, you will be a stockholder of
LADIF. The amount of shares of LADIF Common Stock that you receive will have
the same value as your SWIOF shares, although the number of LADIF shares you
receive will differ from the number of SWIOF shares you own immediately
prior to the closing of the Reorganization.
LADIF's investment policies, after the closing of the Reorganization, will
be substantially identical to those of SWIOF. There is one important
exception -- LADIF will retain its ability to borrow up to 33 1/3% of its
assets.
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Q. HOW WILL THE REORGANIZATION AFFECT ME AS A LADIF STOCKHOLDER?
A. You will continue to be a stockholder in LADIF. LADIF's Board has approved a
number of changes to the Fund's investment policies that would become
effective on the closing of the Reorganization. The general effect of these
changes is to broaden the Fund's geographic focus and allow for greater
investment in local currency denominated securities. To reflect these
changes, LADIF shareholders are being asked to approve a change of the
Fund's name to "Scudder Global High Income Fund, Inc." As part of approving
the Reorganization, you are also being asked to change LADIF's investment
policy with respect to the limitation on the amount of LADIF's assets that
can be invested in securities of a single government.
Q. HOW CAN I EXPECT TO BENEFIT FROM THE REORGANIZATION AS A SWIOF STOCKHOLDER?
A. The Reorganization will result in a larger fund, which should lead to
greater efficiency and flexibility in portfolio management and a more liquid
trading market for shares of the combined Fund. In addition, the combined
Fund will have lower expenses (before any borrowing costs) than SWIOF
currently has.
Q. HOW CAN I EXPECT TO BENEFIT FROM THE REORGANIZATION AS A LADIF STOCKHOLDER?
A. The Reorganization will broaden the universe of investments available to
LADIF. In 1992, when LADIF commenced operations, substantially all issuers
of emerging market debt were located in Latin America. Since then, the
market for emerging market debt securities has grown to include many issuers
located outside Latin America. LADIF stockholders will benefit from the Fund
being able to seek investment opportunities throughout the world, thereby
permitting greater diversification by country, industry and issuer and
giving the Fund access to debt securities that may have higher yields and/or
returns than Latin American issues.
Q. WHO WILL BE THE MANAGEMENT OF A COMBINED SWIOF/LADIF FUND?
A. LADIF will retain its management and board of directors. These individuals
are identical to the individuals that now serve in the same capacity for
SWIOF. In addition, Scudder will continue to serve as the combined Fund's
investment manager, subject to approval of the new investment management
agreement. After the Reorganization, the Lead Portfolio Manager of LADIF,
Isabel Saltzman, and the Lead Portfolio Manager of SWIOF, Susan Gray, will
be co-Lead Portfolio Managers of the combined Fund, sharing responsibility
for the day-to-day management of the portfolio.
Q. IF I AM A SWIOF STOCKHOLDER THAT IS VOTING YES, SHOULD I SEND MY STOCK
CERTIFICATES TO YOU NOW?
A. No. After the Reorganization is approved, you will receive instructions on
where to send your SWIOF stock certificates. Please do not send your
certificates at this time.
THE ALLIANCE
Q. WHY AM I BEING ASKED TO VOTE ON THE PROPOSED NEW INVESTMENT MANAGEMENT
AGREEMENT?
A. The Investment Company Act of 1940, which regulates investment companies,
such as your Fund, requires a vote whenever there is a change in control of
a fund's investment manager. Zurich's alliance with Scudder will result in
such a change of control and requires stockholder approval of a new
investment management agreement with your Fund. SWIOF stockholders are being
asked to approve the new investment management agreement for SWIOF in case
the Reorganization is not approved and SWIOF and LADIF remain as separate
funds.
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Q. HOW WILL THE SCUDDER-ZURICH ALLIANCE AFFECT ME AS A FUND STOCKHOLDER?
A. Except as described in connection with the Reorganization, your Fund and
your Fund investment will not change. The terms of the new investment
management agreement are the same in all material respects as the current
investment management agreement for your Fund. If the new investment
management agreement is approved, the advisory fees charged to your Fund
will be the same. Similarly, the other service agreements between your Fund
and Scudder will not be affected. You should continue to receive the same
level of services that you have come to expect from Scudder over the years.
If stockholders do not approve the new investment management agreement, the
current investment management agreement will terminate upon the closing of
the Scudder-Zurich transaction and the Board of Directors of the relevant
Fund will take such action as it deems to be in the best interest of the
Fund and its stockholders.
Q. WHY HAS SCUDDER DECIDED TO ENTER INTO THIS ALLIANCE?
A. Scudder believes that the Scudder-Zurich alliance will enable Scudder to
enhance its capabilities as a global asset manager. Scudder further believes
that the alliance will enable it to enhance its ability to deliver the level
of services currently provided to you and your Fund and to fulfill its
obligations under the new investment management agreement consistent with
current practices.
Q. WILL THE INVESTMENT MANAGEMENT FEES BE THE SAME?
A. Yes, the investment management fees paid by SWIOF and LADIF will remain the
same.
Q. HOW DO THE BOARD MEMBERS OF MY FUND RECOMMEND THAT I VOTE?
A. After careful consideration, the board members of your Fund, including those
who are not affiliated with the Fund or Scudder, recommend that you vote in
favor of all of the proposals on the enclosed proxy card.
Q. WHO IS PAYING THE COST OF THE STOCKHOLDER MEETING AND THIS PROXY
SOLICITATION?
A. The Funds and Scudder have agreed that the cost of preparing, printing and
mailing the enclosed proxy, accompanying notice and Joint Proxy
Statement -- Prospectus, and all other costs in connection with the
solicitation of proxies will be shared among the Funds and Scudder. The
Funds have agreed to pay 75% of these costs and Scudder has agreed to pay
25% of these costs for amounts that are less than or equal to $300,000.
Scudder has also agreed to pay all of these costs that are in excess of
$300,000. The costs to be paid by the Funds (along with the other costs of
the Reorganization) will be shared pro rata based upon the Funds' relative
asset size.
Q. WHOM DO I CALL FOR MORE INFORMATION?
A. Please call Shareholder Communications Corporation, your Fund's information
agent, at 1-800-733-8481.
ABOUT THE PROXY CARD
If you have more than one account in the Fund in your name at the same
address, you will receive separate proxy cards for each account, but only one
proxy statement for the Fund. Please vote all issues on each proxy card that you
receive.
THANK YOU FOR MAILING YOUR PROXY CARD PROMPTLY.
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