<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 10, 1997
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
SCHEDULE 13E-4
ISSUER TENDER OFFER STATEMENT
(PURSUANT TO SECTION 13(E)(1) OF THE SECURITIES EXCHANGE ACT OF 1934)
ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
(NAME OF ISSUER)
ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
(NAME OF PERSON(S) FILING STATEMENT)
COMMON STOCK, PAR VALUE $.01 PER SHARE
(TITLE OF CLASS OF SECURITIES)
018796102
(CUSIP NUMBER OF CLASS OF SECURITIES)
EDMUND P. BERGAN, JR.
ALLIANCE CAPITAL MANAGEMENT L.P.
1345 AVENUE OF THE AMERICAS
NEW YORK, NEW YORK 10105
(212) 969-1000
(NAME, ADDRESS AND TELEPHONE NUMBER OF PERSON AUTHORIZED TO RECEIVE NOTICES AND
COMMUNICATIONS ON BEHALF OF THE PERSON(S) FILING STATEMENT)
----------------
WITH A COPY TO:
BRUCE D. SENZEL
SEWARD & KISSEL
ONE BATTERY PARK PLAZA
NEW YORK, NEW YORK 10004
DECEMBER 10, 1997
(DATE TENDER OFFER FIRST PUBLISHED, SENT OR GIVEN TO SECURITY HOLDERS)
CALCULATION OF FILING FEE
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TRANSACTION VALUATION AMOUNT OF FILING FEE
- ---------------------------------------------------------------------------------------
<S> <C>
$22,440,794.74(a)............................................ $4,489(b)
- ---------------------------------------------------------------------------------------
</TABLE>
- --------------------------------------------------------------------------------
(a) Calculated as the aggregate maximum purchase price to be paid for 1,297,906
shares in the offer, based upon the net asset value per share $17.29 at
December 5, 1997.
(b) Calculated as 1/50th of 1% of the Transaction Valuation.
[_]Check box if any part of the fee is offset as provided by Rule O-11(a)(2)
and identify the filing with which the offsetting fee was previously paid.
Identify the previous filing by registration statement number, or the Form
or Schedule and the date of its filing.
Amount Previously Paid: ___________ This Schedule 13E-4, including
Form or Registration No.: _________ exhibits, consists of [ ]
Filing Party: _____________________ pages. Exhibit index appears on
Date Filed: _______________________ page [ ].
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
ITEM 1. SECURITY AND ISSUER.
(a) The name of the issuer is Alliance World Dollar Government Fund, Inc., a
non-diversified, closed-end management investment company incorporated in
Maryland (the "Fund"). The address of the principal executive office of the
Fund is 1345 Avenue of the Americas, New York, New York 10105.
(b) The Fund is seeking tenders for 1,297,906 of its issued and outstanding
shares of common stock, par value $.01 per share ("Shares"), for cash at a
price equal to the net asset value ("NAV") per Share determined as of the
close of the regular trading session of the New York Stock Exchange ("NYSE")
on January 8, 1998, upon the terms and subject to the conditions set forth in
the Offer to Purchase dated December 10, 1997 (the "Offer to Purchase") and
the related Letter of Transmittal (which together constitute the "Offer"). The
Offer expires at 12:00 Midnight Eastern Time on January 8, 1998, unless
extended (the "Expiration Date"). If the Offer is extended beyond January 8,
1998, the purchase price for shares will be equal to their NAV determined as
of the close of the regular trading session of the NYSE on the new Expiration
Date. A copy of the Offer to Purchase and the Letter of Transmittal are filed
as Exhibits (a)(1)(ii) and (a)(2)(i) to this statement, respectively.
Reference is hereby made to the Cover Page, Section 1--"Price, Number of
Shares"--and Section 10--"Interest of Certain Related Persons"--of the Offer
to Purchase, which are incorporated herein by reference.
(c) The principal market in which the Shares are traded is the NYSE.
Reference is hereby made to the Cover Page and Section 8--"Price Range of
Shares; Dividends"--of the Offer to Purchase, which are incorporated herein by
reference.
(d) Not applicable.
ITEM 2. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a)-(b) Reference is hereby made to Section 7--"Source and Amount of
Funds"--of the Offer to Purchase, which is incorporated herein by reference.
ITEM 3. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE ISSUER OR
AFFILIATE.
Reference is hereby made to Section 2--"Purpose of the Offer, Plans or
Proposals of the Fund"--, Section 7--"Source and Amount of Funds"--, Section
8--"Price Range of Shares; Dividends"--, and Section 11--"Certain Effects of
the Offer"--of the Offer to Purchase, which are incorporated herein by
reference.
ITEM 4. INTEREST IN SECURITIES OF THE ISSUER.
Reference is hereby made to Section 10--"Interest of Certain Related
Persons"--of the Offer to Purchase, which is incorporated herein by reference.
ITEM 5. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO THE ISSUER'S SECURITIES.
Reference is hereby made to Section 2--"Purpose of the Offer; Plans or
Proposals of the Fund"--, Section 7--"Source and Amount of Funds"--, Section
10--"Interest of Certain Related Persons"--, and Section 11--"Certain Effects
of the Offer"-- of the Offer to Purchase, which are incorporated herein by
reference. Except as set forth therein, the Fund does not know of any
contract, arrangement, understanding or relationship with any other person
relating, directly or indirectly, to the Offer between the (A) Fund, any
executive officer or director of the Fund, or any person controlling the Fund
or any executive officer or director of any corporation ultimately in control
of the Fund, and (B) any other person, with respect to any securities of the
Fund (including, but not limited to, any contract, arrangement, understanding
or relationship concerning the transfer or the voting of any such securities,
joint ventures, loan or option arrangements, puts or calls, guaranties of
loans, guaranties against loss, or the giving or withholding of proxies,
consents or authorizations).
2
<PAGE>
ITEM 6. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.
The Fund has entered into a Depositary Agreement, dated as of December 10,
1997, with BankBoston, N.A. (the "Depositary") to provide certain depositary
services in connection with the Offer. For its services, the Depositary will
receive fees of $7,500, $7.50 for each Letter of Transmittal processed, $10.00
for each withdrawal of tendered Shares, each defective tender and each
guaranteed delivery of tendered Shares, and $1,500 for each extension of the
Offer, plus reimbursement of its expenses. The Depositary Agreement is filed
as Exhibit (c)(1) to this statement, which is incorporated herein by
reference.
No persons have been employed or retained or are to be compensated by or on
behalf of the Fund to make solicitations or recommendations in connection with
the Offer.
ITEM 7. FINANCIAL INFORMATION.
(a)(1) The Fund's audited financial statements for the fiscal years ended
October 31, 1997 and October 31, 1996 (the "Audited Financial Statements"),
together with the consent of Ernst & Young LLP, the independent auditors of
the Fund, are included as part of Exhibit (a)(1)(ii) to this statement, which
is incorporated herein by reference in its entirety. For a summary of selected
financial information for these fiscal years, see Section 9-- "Selected
Financial Information"--of the Offer to Purchase, which is incorporated herein
by reference.
(2) Not applicable.
(3) Certain ratios applicable to the Fund for the fiscal years ended October
31, 1997 and October 31, 1996 are contained in the Audited Financial
Statements. Certain ratios applicable to the Fund for these fiscal years are
set forth in Section 9--"Selected Financial Information"--of the Offer to
Purchase, which is incorporated herein by reference.
(4) The Fund's NAV per Share as of October 31, 1997 is set forth in the
Audited Financial Statements for the fiscal year ended October 31, 1997. Such
information is also set forth in Section 9--"Selected Financial Information"--
of the Offer to Purchase, which is incorporated herein by reference.
(b) It is not possible for the Fund to predict the number of Shares that
will be tendered pursuant to the Offer; accordingly, it is not possible for
the Fund to provide pro forma information disclosing the effect of the Offer.
ITEM 8. ADDITIONAL INFORMATION.
(a) Reference is hereby made to Section 10--"Interest of Certain Related
Persons"--of the Offer to Purchase, which is incorporated herein by reference.
(b)-(d) Not applicable.
(e) The Offer to Purchase, which is filed as Exhibit (a)(1)(ii) to this
statement, is incorporated herein by reference in its entirety.
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS.
<TABLE>
<C> <S>
(a)(1)(i) Advertisement printed in The Wall Street Journal.
(a)(1)(ii) Offer to Purchase.
(a)(2)(i) Form of Letter of Transmittal.
(a)(2)(ii) Form W-8.
(a)(2)(iii) Form of Notice of Guaranteed Delivery.
(a)(3)(i) Form of Letter to Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees.
</TABLE>
3
<PAGE>
<TABLE>
<C> <S>
(a)(3)(ii) Form of Letter to Clients of Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees.
(a)(3)(iii) Questions and Answers, to be Used Only by Brokers, Dealers,
Commercial Banks, Trust Companies and Other Nominees and by the
Depositary.
(a)(3)(iv) Form of Letter to Stockholders Who Have Requested Information.
(a)(4) Text of Press Release dated December 9, 1997.
(b) Not applicable.
(c)(1) Depositary Agreement between Alliance World Dollar Government
Fund, Inc. and BankBoston, N.A. dated as of December 10, 1997.
(c)(2) Advisory Agreement between Alliance World Dollar Government
Fund, Inc. and Alliance Capital Management L.P. dated October
29, 1992.
(c)(3) Administration Agreement between Alliance World Dollar
Government Fund, Inc. and Alliance Capital Management L.P. dated
October 1, 1994.
(c)(4) Shareholder Inquiry Agency Agreement between Alliance World
Dollar Government Fund, Inc. and Alliance Fund Services, Inc.
dated November 28, 1995.
(d)-(f) Not applicable.
</TABLE>
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
4
<PAGE>
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify that
the information set forth in this statement is true, complete and correct.
Alliance World Dollar Government Fund,
Inc.
Name: /s/ Edmund P. Bergan, Jr.
Title: Secretary
Dated: December 10, 1997
5
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
PAGES IN
SEQUENTIALLY
EXHIBIT NUMBERED
NUMBER EXHIBIT ORIGINAL
------- ------- ------------
<C> <S> <C>
(a)(1)(i) Advertisement printed in The Wall Street Journal...
(a)(1)(ii) Offer to Purchase..................................
(a)(2)(i) Form of Letter of Transmittal......................
(a)(2)(ii) Form W-8...........................................
(a)(2)(iii) Form of Notice of Guaranteed Delivery..............
(a)(3)(i) Form of Letter to Brokers, Dealers, Commercial
Banks, Trust Companies and Other Nominees..........
(a)(3)(ii) Form of Letter to Clients of Brokers, Dealers,
Commercial Banks, Trust Companies and Other
Nominees...........................................
(a)(3)(iii) Questions and Answers, to be Used Only by Brokers,
Dealers, Commercial Banks, Trust Companies and
Other Nominees and by the Depositary...............
(a)(3)(iv) Form of Letter to Stockholders Who Have Requested
Information........................................
(a)(4) Text of Press Release dated December 9, 1997.......
(c)(1) Depositary Agreement between Alliance World Dollar
Government Fund, Inc. and BankBoston, N.A. dated as
of December 10, 1997...............................
(c)(2) Advisory Agreement between Alliance World Dollar
Government Fund, Inc. and Alliance Capital
Management L.P. dated October 29, 1992.............
(c)(3) Administration Agreement between Alliance World
Dollar Government Fund, Inc. and Alliance Capital
Management L.P. dated October 1, 1994..............
(c)(4) Shareholder Inquiry Agency Agreement between
Alliance World Dollar Government Fund, Inc. and
Alliance Fund Services, Inc. dated November 28,
1995...............................................
</TABLE>
6
<PAGE>
EXHIBIT (a)(1)(i)
This announcement is neither an offer to purchase nor a solicitation of an offer
to sell Shares (as defined below). The Offer (as defined below) is made solely
by the Offer to Purchase dated December 10, 1997 and the related Letter of
Transmittal and is not being made to (nor will tenders be accepted from or on
behalf of) holders of Shares in any jurisdiction in which the making of the
Offer or the acceptance thereof would not be in compliance with the laws of such
jurisdiction. In any jurisdiction where the securities, blue sky or other laws
require the Offer to be made by a licensed broker or dealer, the Offer shall be
deemed to be made on behalf of the Fund (as defined below) by one or more
registered brokers or dealers licensed under the laws of such jurisdiction.
ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
1345 Avenue of the Americas
New York, New York 10105
Notice of Offer to Purchase for Cash 1,297,906 of Its
Issued and Outstanding Shares of
Common Stock at Net Asset Value Per Share
THE OFFER WILL EXPIRE AT 12:00 MIDNIGHT
EASTERN TIME ON JANUARY 8, 1998 UNLESS THE OFFER IS EXTENDED.
Alliance World Dollar Government Fund, Inc. (the "Fund") is offering to
purchase, upon the terms and subject to the conditions set forth in the Offer to
Purchase dated December 10, 1997 and the related Letter of Transmittal (which
together constitute the "Offer"), 1,297,906 outstanding shares of its issued and
outstanding Common Stock, par value $0.01 per share ("Shares"), at a price equal
to their net asset value ("NAV") per Share determined as of the close of the
regular trading session of the New York Stock Exchange (the "NYSE") on January
8, 1998. The Offer will expire at 12:00 Midnight Eastern Time on January 8,
1998, subject to the right of the Board of Directors of the Fund to extend the
Offer. The NAV as of the close of the regular trading session on the NYSE on
December 5, 1997 was $17.29 per Share. The purpose of the Offer is to fulfill
an undertaking made by the Fund in connection with the initial public offering
of Shares. The Offer is not conditioned upon Stockholders tendering in the
aggregate any minimum number of Shares.
If more than 1,297,906 Shares are duly tendered prior to the expiration of
the Offer, including any extensions (and not timely withdrawn), unless the Fund
determines not to purchase any Shares, the Fund will purchase 1,297,906 Shares
on a pro rata basis (disregarding fractions) in accordance with the number of
Shares tendered by or on behalf of each Stockholder during the period the Offer
is open (and not timely withdrawn).
Shares tendered pursuant to the Offer may be withdrawn by written notice to
the Depositary at the Depositary's mailing address set forth below at any time
prior to 5:00 p.m. Eastern Time on January 12, 1998 (or, if the Offer is
extended, prior to that time on the second day on which the NYSE is open for
trading after the new expiration date), and, if the Shares tendered have not by
then been accepted for payment by the Fund, the Shares may also be withdrawn at
any time after February 5, 1998.
The information required to be disclosed by paragraph (d)(1) of Rule 13e-4
under the Securities Exchange Act of 1934, as amended, is contained in the Offer
to Purchase and is incorporated herein by reference.
The Offer to Purchase and the related Letter of Transmittal contain
important information that should be read carefully before any decision is made
with respect to the Offer.
Each Stockholder tendering Shares is required to submit a check in the
amount of $25.00 payable to BankBoston, N.A. (the "Depositary") which will help
defray the costs associated with effecting the Offer.
Requests for copies of the Offer to Purchase, the Letter of Transmittal and
all other tender offer documents should be directed to the Distribution Agent at
the Distribution Agent's mailing address or telephone number set forth below
between the hours of 9:00 a.m. and 5:00 p.m. Eastern Time, Monday through Friday
(except holidays). Copies of these documents will be furnished promptly to
Stockholders upon request at no expense to them. Stockholders who do not own
Shares directly may also obtain such information from their broker, dealer,
commercial bank, trust company or other nominee and are required to tender their
Shares through that firm. Questions and requests for assistance as well as for
current NAV quotations may be directed to the Depositary at the Depositary's
mailing address or telephone number set forth below, also between the hours of
9:00 a.m. and 5:00 p.m. Eastern Time, Monday through Friday (except holidays).
Distribution Agent: Depositary:
CORPORATE INVESTOR COMMUNICATIONS, INC. BANKBOSTON, N.A.
Distribution Center Corporate Reorganization
111 Commerce Road P.O. Box 9061
Carlstadt, New Jersey 07072-2586 Boston, Massachusetts 02205-8686
Telephone Number: (800) 346-7885 Telephone Number: (800) 331-1710
December 10, 1997
<PAGE>
EXHIBIT (a)(1)(ii)
ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
OFFER TO PURCHASE FOR CASH
1,297,906 OF ITS ISSUED AND OUTSTANDING SHARES
AT NET ASSET VALUE PER SHARE
THE OFFER WILL EXPIRE AT 12:00 MIDNIGHT EASTERN TIME ON
JANUARY 8, 1998, UNLESS THE OFFER IS EXTENDED.
To the Stockholders of Alliance World Dollar Government Fund, Inc.:
Alliance World Dollar Government Fund, Inc., a non-diversified, closed-end
management investment company incorporated in Maryland (the "Fund"), is
offering to purchase 1,297,906 of its issued and outstanding shares of common
stock, par value $.01 per share (the "Shares"), to fulfill an undertaking made
in connection with the initial public offering of the Shares. See Section 2.
The offer is for cash at a price equal to the net asset value ("NAV") per
Share determined as of the close of the regular trading session of the New
York Stock Exchange (the "NYSE") on the date the offer expires, and is upon
the terms and subject to the conditions set forth in this Offer to Purchase
and the related Letter of Transmittal (which together constitute the "Offer").
The Offer will expire at 12:00 Midnight Eastern Time on January 8, 1998,
unless extended. The Shares are traded on the NYSE under the symbol "AWG." The
NAV as of the close of the regular trading session of the NYSE on December 5,
1997 was $17.29 per Share. During the pendency of the Offer, current NAV
quotations can be obtained from BankBoston, N.A. (the "Depositary"), by
calling (800) 331-1710 between the hours of 9:00 a.m. and 5:00 p.m. Eastern
Time, Monday through Friday (except holidays).
THIS OFFER IS SUBJECT TO CERTAIN CONDITIONS. SEE SECTION 3.
IMPORTANT
Stockholders who desire to tender their Shares should either: (1) properly
complete and sign the Letter of Transmittal (or a copy or facsimile thereof),
provide thereon the original of any required signature guarantee(s) and mail
or deliver it together with the Shares (in proper certificated or
uncertificated form), any other documents required by the Letter of
Transmittal, and a check in the amount of $25.00 payable to BankBoston, N.A.,
Depositary (the "Processing Fee"); or (2) request their broker, dealer,
commercial bank, trust company or other nominee to effect the transaction on
their behalf. Stockholders who desire to tender Shares registered in the name
of such a firm must contact that firm to effect a tender on their behalf.
Tendering Stockholders will not be obligated to pay brokerage commissions in
connection with their tender of Shares, but they may be charged a fee by such
a firm for processing the tender(s). The Fund reserves the absolute right to
reject tenders determined not to be in appropriate form or not accompanied by
the Processing Fee.
If you do not wish to tender your Shares, you need not take any action.
NEITHER THE FUND NOR ITS BOARD OF DIRECTORS NOR ALLIANCE CAPITAL MANAGEMENT
L.P. (THE "INVESTMENT ADVISER") MAKES ANY RECOMMENDATION TO ANY STOCKHOLDER AS
TO WHETHER TO TENDER OR REFRAIN FROM TENDERING SHARES. NO PERSON HAS BEEN
AUTHORIZED TO MAKE ANY RECOMMENDATION ON BEHALF OF THE FUND, ITS BOARD OF
DIRECTORS OR THE INVESTMENT ADVISER AS TO WHETHER STOCKHOLDERS SHOULD TENDER
OR REFRAIN FROM TENDERING SHARES PURSUANT TO THE OFFER OR TO MAKE ANY
REPRESENTATION OR TO GIVE ANY INFORMATION IN CONNECTION WITH THE OFFER OTHER
THAN AS CONTAINED HEREIN OR IN THE LETTER OF TRANSMITTAL. IF MADE OR GIVEN,
ANY SUCH RECOMMENDATION, REPRESENTATION OR INFORMATION MUST NOT BE RELIED UPON
AS HAVING BEEN AUTHORIZED BY THE FUND, ITS BOARD OF DIRECTORS OR THE
INVESTMENT ADVISER. STOCKHOLDERS ARE URGED TO EVALUATE CAREFULLY ALL
<PAGE>
INFORMATION IN THE OFFER, CONSULT THEIR OWN INVESTMENT AND TAX ADVISERS AND
MAKE THEIR OWN DECISIONS WHETHER TO TENDER OR REFRAIN FROM TENDERING THEIR
SHARES.
Questions and requests for assistance may be directed to the Depositary at
the Depositary's mailing address and at the telephone number set forth below.
Requests for additional copies of this Offer to Purchase, the Letter of
Transmittal and any other tender offer documents should be directed to the
Depositary at the Distribution Agent's address or telephone number.
Stockholders who do not own Shares directly may also obtain such information
and copies from their broker, dealer, commercial bank, trust company or other
nominee and are required to tender their Shares through that firm.
December 10, 1997
Alliance World Dollar Government Fund, Inc.
1345 Avenue of the Americas
New York, New York 10105
BANKBOSTON, N.A., DEPOSITARY
TELEPHONE NUMBER: (800) 331-1710
BY FIRST CLASS MAIL: BY REGISTERED, CERTIFIED BY HAND:
OR EXPRESS MAIL OR
OVERNIGHT COURIER:
Boston EquiServe, L.P. Boston EquiServe, L.P. Securities Transfer and
Corporate Reorganization Corporate Reorganization Reporting Services, Inc.
P.O. Box 9061 70 Campanelli Drive Boston EquiServe, L.P.
Boston, MA 02205-8686 Braintree, MA 02184 Corporate Reorganization
1 Exchange Plaza
55 Broadway, Third Floor
New York, NY 10006
CORPORATE INVESTOR COMMUNICATIONS, INC., DISTRIBUTION AGENT
TELEPHONE NUMBER: (800) 346-7885
Distribution Center
111 Commerce Road
Carlstadt, New Jersey 07072-2586
2
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
SECTION PAGE
- ------- ----
<S> <C>
1.Price; Number of Shares............................................... 4
2.Purpose of the Offer; Plans or Proposals of the Fund.................. 4
3.Certain Conditions of the Offer....................................... 6
4.Procedures for Tendering Shares....................................... 6
a.Proper Tender of Shares............................................. 6
b.Signature Guarantees and Method of Delivery......................... 7
c.Dividend Reinvestment Plan.......................................... 8
d.Book-Entry Delivery................................................. 8
e.Guaranteed Delivery................................................. 8
f.Determinations of Validity.......................................... 9
g.United States Federal Income Tax Withholding........................ 9
5.Withdrawal Rights..................................................... 10
6.Payment for Shares.................................................... 10
7.Source and Amount of Funds............................................ 11
8.Price Range of Shares; Dividends...................................... 12
9.Selected Financial Information........................................ 13
10.Interest of Certain Related Persons................................... 14
11.Certain Effects of the Offer.......................................... 14
12.Certain Information about the Fund.................................... 14
13.Additional Information................................................ 15
14.Certain United States Federal Income Tax Consequences................. 15
15.Amendments; Extension of Tender Period; Termination................... 16
16.Miscellaneous......................................................... 17
Exhibit A: Audited Financial Statements of the Fund for the Fiscal Years
ended October 31, 1997 and October 31, 1996.
</TABLE>
3
<PAGE>
1. Price; Number of Shares. Upon the terms and subject to the conditions of
the Offer, the Fund will accept for payment and purchase up to 1,297,906 of
its issued and outstanding Shares that are properly tendered prior to 12:00
Midnight Eastern Time on January 8, 1998 (and not withdrawn in accordance with
Section 5). The Fund reserves the right to amend, extend or terminate the
Offer. See Sections 3 and 15. The Fund will not be obligated to purchase
Shares pursuant to the Offer under certain circumstances. See Section 3. The
later of January 8, 1998 or the latest date to which the Offer is extended is
hereinafter called the "Expiration Date." The purchase price of the Shares
will be their NAV per Share determined as of the close of the regular trading
session of the NYSE on the Expiration Date. The Fund will not pay interest on
the purchase price under any circumstances. The NAV as of the close of the
regular trading session of the NYSE on December 5, 1997 was $17.29 per Share.
During the pendency of the Offer, current NAV quotations can be obtained from
the Depositary by calling (800) 331-1710 between the hours of 9:00 a.m. and
5:00 p.m. Eastern Time, Monday through Friday (except holidays).
The Offer is being made to all Stockholders and is not conditioned upon
Stockholders tendering in the aggregate any minimum number of Shares. Pursuant
to the Fund's Prospectus dated October 29, 1992 (the "Prospectus"), however, a
Stockholder wishing to accept the Offer is required to tender all (but not
less than all) Shares owned by the Stockholder and all Shares attributed to
the Stockholder for Federal income tax purposes under Section 318 of the
Internal Revenue Code of 1986, as amended (the "Code"), as of the date of
purchase of Shares by the Fund pursuant to the Offer. See Section 14
concerning the tax consequences of tendering Shares.
If more than 1,297,906 Shares are duly tendered pursuant to the Offer (and
not withdrawn as provided in Section 5), unless the Fund determines not to
purchase any Shares, the Fund will purchase Shares from tendering
Stockholders, in accordance with the terms and conditions specified in the
Offer, on a pro rata basis (disregarding fractions), in accordance with the
number of Shares duly tendered by or on behalf of each Stockholder (and not so
withdrawn). See Section 3. If Shares duly tendered by or on behalf of a
Stockholder include Shares held pursuant to the Fund's Dividend Reinvestment
Plan, the proration will be applied first with respect to other Shares
tendered and only thereafter, if and as necessary, with respect to Shares held
pursuant to that Plan.
On December 5, 1997, there were 8,652,707 Shares issued and outstanding, and
there were approximately 830 holders of record of Shares. Certain of these
holders of record were brokers, dealers, commercial banks, trust companies and
other institutions that held Shares in nominee name on behalf of multiple
beneficial owners.
2. Purpose of the Offer; Plans or Proposals of the Fund. The purpose of the
Offer is to fulfill an undertaking made in connection with the initial public
offering of the Shares, as set forth in the Fund's Prospectus. In the
Prospectus, the Fund indicated that, in recognition of the possibility that
the Shares might trade at a discount to NAV, the Fund's Board of Directors
(the "Board of Directors" or the "Board") had determined that it would be in
the interest of Stockholders to take action to attempt to reduce or eliminate
a market value discount from NAV.
In this regard, in the Prospectus, the Fund undertook to commence a tender
offer for Shares during the fourth quarter of 1997 subject to a policy that
the Fund would not proceed with the tender offer if Shares are traded on the
principal securities exchange where listed (at present the NYSE) at or above
NAV or at an average discount from NAV of less than 5%, determined on the
basis of the discount as of the last trading day in each week (a "weekly
valuation day") during a period of 12 calendar weeks prior to September 1,
1997 (the "Measurement Period"). On June 17, 1997, the Board fixed the
Measurement Period for the Offer as the period beginning on June 9, 1997 and
terminating with the week ended August 29, 1997. The average trading price of
the Shares on the weekly valuation days during the Measurement Period was
$16.73 per Share, and the average NAV per Share on the same days was $17.69,
reflecting an average discount of approximately 5.43%. Accordingly, the Fund
is conducting the Offer.
4
<PAGE>
Pursuant to the Prospectus undertaking, in the event that the Board
determines not to purchase Shares pursuant to the Offer for any of the reasons
set forth in Section 3, the Fund is to commence one or more additional offers
to purchase Shares (a "Subsequent Offer"). If, however, the Fund has not
purchased all Shares tendered pursuant to the Offer, or a Subsequent Offer, by
March 31, 1998, the Fund's Articles of Incorporation require the Board to
submit to Stockholders by no later than July 31, 1998 a proposal to convert
the Fund to an open-end investment company (the "Conversion Proposal"). If
required, the Conversion Proposal will be submitted to Stockholders at the
Annual Meeting of Stockholders to be held on March 31, 1998. The Board has set
the close of business on January 13, 1998 as the record date for purposes of
Stockholder entitlement to vote at that meeting. The affirmative vote of the
holders of a majority of the Fund's then outstanding shares would be required
for approval of the Conversion Proposal. In the event Stockholder approval of
that proposal is not obtained, the Fund would continue as a closed-end
investment company.
The undertaking set forth in the Prospectus also provides that the Fund is
to commence a tender offer during the fourth quarter of 2002, subject to the
same conditions set forth above with respect to the Offer except that the
corresponding measurement period is a period of 12 calendar weeks prior to
September 1, 2002. In the event that the Board determines not to purchase
Shares pursuant to the 2002 tender offer for any of the reasons set forth in
Section 3, the undertaking provides for a related tender offer with respect to
the 2002 tender offer which corresponds to the Subsequent Offer, and the
Fund's Articles of Incorporation provide for the submission of a corresponding
Conversion Proposal to Shareholders by July 31, 2003 if the Fund has not by
March 31, 2003 purchased all Shares tendered pursuant to the 2002 tender offer
or the subsequent offer with respect thereto.
In addition to tender offers pursuant to the above-described undertaking,
the Board considers from time to time the repurchase of Shares in the open
market and other tender offers for Shares at NAV. The Board intends each
quarter to consider the making of a tender offer or open market repurchases of
Shares if Shares have been trading at a discount to NAV in excess of 5%,
determined on the basis of the discount as of the last trading day in each
week during a period of 12 calendar weeks preceding the Board's quarterly
meeting. There can be no assurance that the Board will authorize any such
action. There can also be no assurance that the Offer, other Share tender
offers or Share repurchases or the prospect of such actions will result in the
Shares trading at a price equal to their NAV. The market price of the Shares
will be determined by, among other things, the relative demand for and supply
of Shares in the market, the Fund's investment performance, the Fund's
dividends and yield, and investor perception of the Fund's overall
attractiveness as an investment as compared with other investment
alternatives.
At the above referred to March 31, 1998 Annual Meeting of Stockholders, a
proposal approved by the Board is to be put before the Stockholders for their
approval for the amendment of a fundamental investment policy of the Fund
regarding investments in a type of sovereign debt obligations of emerging
market countries issued in debt restructurings known as Brady Bonds. While
leaving unchanged the minimum percentage of the Fund's assets required to be
invested in sovereign debt obligations and U.S. Treasury zero coupon
obligations, the amendment would eliminate a requirement that only Brady Bonds
collateralized as to principal due at maturity by U.S. Treasury zero coupon
obligations would qualify.
Except as set forth above, as referred to in Section 7, or in connection
with the operation of the Fund's Dividend Reinvestment Plan, the Fund does not
have any present plans or proposals that relate to or would result in (a) the
acquisition by any person of additional securities of the Fund or the
disposition of securities of the Fund; (b) an extraordinary corporate
transaction, such as a merger, reorganization or liquidation involving the
Fund; (c) other than in connection with liquidating assets in the ordinary
course of the Fund's operations and for purposes of funding the Offer, a sale
or transfer of a material amount of assets of the Fund; (d) any change in the
composition of the Board or in the management of the Fund, including, but not
limited to, any plans or proposals to change the number or the term of members
of the Board, to fill any existing vacancy on the Board or to change any
material term of the employment contract of any executive officer; (e) any
material change in the Fund's present dividend rate or policy, or indebtedness
or capitalization of the Fund; (f) any other material change in the Fund's
corporate structure or business, including any plans or proposals to make any
changes in the Fund's investment policy for which a vote would be required by
Section 13 of the Investment Company Act
5
<PAGE>
of 1940, as amended (the "1940 Act"); (g) changes in the Fund's articles of
incorporation, bylaws or instruments corresponding thereto or other actions
which may impede the acquisition of control of the Fund by any person; (h)
causing a class of equity security of the Fund to be delisted from a national
securities exchange or to cease to be authorized to be quoted in an inter-
dealer quotation system of a registered national securities association; (i) a
class of equity security of the Fund becoming eligible for termination of
registration pursuant to Section 12(g)(4) of the Securities Exchange Act of
1934, as amended (the "Exchange Act"); or (j) the suspension of the Fund's
obligation to file reports pursuant to Section 15(d) of the Exchange Act.
3. Certain Conditions of the Offer. Notwithstanding any other provision of
the Offer or the Prospectus, the announced policy of the Board, which may be
changed by the Board, is that the Fund will not purchase shares pursuant to
the Offer (or a Subsequent Offer) if (a) such transactions, if consummated,
would (i) result in the delisting of the Shares from the NYSE (the NYSE having
advised the Fund that it would consider delisting if the aggregate market
value of the outstanding publicly held Shares is less than $5,000,000, the
number of publicly held Shares falls below 600,000 or the number of holders of
100 Shares or more falls below 1,200) or (ii) impair the Fund's status as a
regulated investment company under the Code (which would make the Fund a
taxable entity, causing the Fund's income to be taxed at the corporate level
in addition to the taxation of Stockholders who receive dividends from the
Fund); (b) the Fund would not be able to liquidate portfolio securities in an
orderly manner and consistent with the Fund's investment objective and
policies in order to purchase Shares tendered pursuant to the Offer (or the
Subsequent Offer); or (c) there is any (i) material legal action or proceeding
instituted or threatened which challenges, in the Board's judgment, the Offer
(or the Subsequent Offer) or otherwise materially adversely affects the Fund,
(ii) suspension of or limitation on prices for trading securities generally on
the NYSE or any foreign exchange on which portfolio securities of the Fund are
traded, (iii) declaration of a banking moratorium by Federal, state or foreign
authorities or any suspension of payment by banks in the United States, New
York State or in a foreign country which is material to the Fund, (iv)
limitation which affects the Fund or the issuers of its portfolio securities
imposed by Federal, state or foreign authorities on the extension of credit by
lending institutions or on the exchange of foreign currencies, (v)
commencement of war, armed hostilities or other international or national
calamity directly or indirectly involving the United States or any foreign
country that is material to the Fund, or (vi) other event or condition which,
in the Board's judgment, would have a material adverse effect on the Fund or
its Stockholders if Shares tendered pursuant to the Offer (or the Subsequent
Offer) were purchased. The Board may modify these conditions in light of
experience.
The foregoing conditions are for the Fund's sole benefit and may be asserted
by the Fund regardless of the circumstances giving rise to any such condition
(including any action or inaction of the Fund), and any such condition may be
waived by the Fund, in whole or in part, at any time and from time to time in
its reasonable judgment. The Fund's failure at any time to exercise any of the
foregoing rights shall not be deemed a waiver of any such right; the waiver of
any such right with respect to particular facts and circumstances shall not be
deemed a waiver with respect to any other facts or circumstances; and each
such right shall be deemed an ongoing right which may be asserted at any time
and from time to time. Any determination by the Fund concerning the events
described in this Section 3 shall be final and binding.
The Fund reserves the right, at any time during the pendency of the Offer,
to amend, extend or terminate the Offer in any respect. See Section 15.
4. Procedures for Tendering Shares.
a. Proper Tender of Shares. For Shares to be properly tendered pursuant to
the Offer, a properly completed and duly executed Letter of Transmittal (or a
copy or facsimile thereof) bearing original signature(s) and the original of
any required signature guarantee(s)), all Shares actually or, as determined
under Section 318 of the Code, constructively owned by the tendering
Stockholder (see Sections 1 and 14) (in proper certificated or uncertificated
form), any other documents required by the Letter of Transmittal and the
Processing Fee must be received by the Depositary at the appropriate address
set forth on page 2 of this Offer before 12:00 Midnight Eastern Time on the
Expiration Date. Letters of Transmittal and certificates representing tendered
Shares should
6
<PAGE>
not be sent or delivered to the Fund. Stockholders who desire to tender Shares
registered in the name of a broker, dealer, commercial bank, trust company or
other nominee must contact that firm to effect a tender on their behalf.
Section 14(e) of the Exchange Act and Rule 14e-4 promulgated thereunder make
it unlawful for any person, acting alone or in concert with others, to tender
Shares in a partial tender offer for such person's own account unless at the
time of tender, and at the time the Shares are accepted for payment, the
person tendering has a net long position equal to or greater than the amount
tendered in (a) Shares, and will deliver or cause to be delivered such Shares
for the purpose of tender to the person making the Offer within the period
specified in the Offer, or (b) an equivalent security and, upon acceptance of
his or her tender, will acquire Shares by conversion, exchange, or exercise of
such equivalent security to the extent required by the terms of the Offer, and
will deliver or cause to be delivered the Shares so acquired for the purpose
of tender to the Fund prior to or on the Expiration Date. Section 14(e) and
Rule 14e-4 provide a similar restriction applicable to the tender or guarantee
of a tender on behalf of another person.
The acceptance of Shares by the Fund for payment will constitute a binding
agreement between the tendering Stockholder and the Fund upon the terms and
subject to the conditions of the Offer, including the tendering Stockholder's
representation that the Stockholder has a net long position in the Shares
being tendered within the meaning of Rule 14e-4 and that the tender of such
Shares complies with Rule 14e-4.
b. Signature Guarantees and Method of Delivery. No signature guarantee is
required if (a) the Letter of Transmittal is signed by the registered
holder(s) (including, for purposes of this document, any participant in The
Depository Trust Company ("DTC") book-entry transfer facility whose name
appears on DTC's security position listing as the owner of Shares) of the
Shares tendered thereby, unless such holder(s) has completed either the box
entitled "Special Payment Instructions" or the box entitled "Special Delivery
Instructions" in the Letter of Transmittal or (b) the Shares tendered are
tendered for the account of a firm (an "Eligible Institution") which is a
broker, dealer, commercial bank, credit union, savings association or other
entity and which is a member in good standing of a stock transfer
association's approved medallion program (such as STAMP, SEMP or MSP). In all
other cases, all signatures on the Letter of Transmittal must be guaranteed by
an Eligible Institution. See Instruction 5 of the Letter of Transmittal.
If the Letter of Transmittal is signed by the registered holder(s) of the
Shares tendered thereby, the signature(s) must correspond with the name(s) as
written on the face of the certificate(s) for the Shares tendered without
alteration, enlargement or any change whatsoever.
If any of the Shares tendered thereby are owned of record by two or more
joint owners, all such owners must sign the Letter of Transmittal.
If any of the tendered Shares are registered in different names (including
Shares constructively owned by the tendering Stockholder as determined under
Section 318 of the Code which must also be tendered--see Sections 1 and 14),
it is necessary to complete, sign and submit as many separate Letters of
Transmittal as there are different registrations.
If the Letter of Transmittal or any certificates for Shares tendered or
stock powers relating to Shares tendered are signed by trustees, executors,
administrators, guardians, attorneys-in-fact, officers of corporations or
others acting in a fiduciary or representative capacity, such persons should
so indicate when signing, and proper evidence satisfactory to the Fund of
their authority so to act must be submitted.
If the Letter of Transmittal is signed by the registered holder(s) of the
Shares transmitted therewith, no endorsements of certificates or separate
stock powers with respect to such Shares are required unless payment is to be
made to, or certificates for Shares not purchased are to be issued in the name
of, a person other than the registered holder(s). Signatures on such
certificates or stock powers must be guaranteed by an Eligible Institution.
7
<PAGE>
If the Letter of Transmittal is signed by a person other than the registered
holder(s) of the certificate(s) listed thereon, the certificate(s) must be
endorsed or accompanied by appropriate stock powers, in either case signed
exactly as the name(s) of the registered holder(s) appear(s) on the
certificate(s) for the Shares involved. Signatures on such certificates or
stock powers must be guaranteed by an Eligible Institution. See Section 6.
c. Dividend Reinvestment Plan. First Data Investor Services Group, Inc., the
Fund's Transfer Agent, holds Shares in uncertificated form for certain
Stockholders pursuant to the Fund's Dividend Reinvestment Plan. In addition to
tendering all of their other Shares, Stockholders wishing to accept the Offer
must tender all such uncertificated Shares. See Section 1 concerning the
manner in which any necessary proration will be made.
d. Book-Entry Delivery. The Depositary has established an account with
respect to the Shares at DTC for purposes of the Offer. Any financial
institution that is a participant in the DTC system may make book-entry
delivery of tendered Shares by causing DTC to transfer such Shares into the
Depositary's account at DTC in accordance with DTC's procedures for such
transfers. However, although delivery of Shares may be effected through book-
entry transfer into the Depositary's account at DTC, a Letter of Transmittal
(or a copy or facsimile thereof) properly completed and bearing original
signature(s) and the original of any required signature guarantee(s), or an
Agent's Message (as defined below) in connection with a book-entry transfer,
any other documents required by the Letter of Transmittal and the Processing
Fee, must in any case be received by the Depositary prior to 12:00 Midnight
Eastern Time on the Expiration Date at one of its addresses set forth on page
2 of this Offer, or the tendering Stockholder must comply with the guaranteed
delivery procedures described below.
The term "Agent's Message" means a message from DTC transmitted to, and
received by, the Depositary forming a part of a timely confirmation of a book-
entry transfer of Shares (a "Book-Entry Confirmation") which states that (a)
DTC has received an express acknowledgment from the DTC participant tendering
the Shares that are the subject of the Book-Entry Confirmation, (b) the DTC
participant has received and agrees to be bound by the terms of the Letter of
Transmittal, and (c) the Fund may enforce such agreement against the DTC
participant.
Delivery of documents to DTC in accordance with DTC's procedures does not
constitute delivery to the Depositary.
e. Guaranteed Delivery. Notwithstanding the foregoing, if a Stockholder
desires to tender Shares pursuant to the Offer and the certificates for the
Shares to be tendered are not immediately available, or time will not permit
the Letter of Transmittal and all documents required by the Letter of
Transmittal to reach the Depositary prior to 12:00 Midnight Eastern Time on
the Expiration Date, or a Stockholder cannot complete the procedures for
delivery by book-entry transfer on a timely basis, then such Stockholder's
Shares may nevertheless be tendered, provided that all of the following
conditions are satisfied:
(i) the tender is made by or through an Eligible Institution; and
(ii) a properly completed and duly executed Notice of Guaranteed Delivery
in the form provided by the Fund is received by the Depositary prior to
12:00 Midnight Eastern Time on the Expiration Date; and
(iii) the certificates for all such tendered Shares, in proper form for
transfer, or a Book-Entry Confirmation with respect to such Shares, as the
case may be, together with a Letter of Transmittal (or a copy or facsimile
thereof) properly completed and bearing original signature(s) and the
original of any required signature guarantee(s) (or, in the case of a book-
entry transfer, an Agent's Message), any documents required by the Letter
of Transmittal and the Processing Fee, are received by the Depositary prior
to 5:00 P.M. Eastern Time on the second NYSE trading day after the date of
execution of the Notice of Guaranteed Delivery.
The Notice of Guaranteed Delivery may be delivered by hand or transmitted by
facsimile transmission or mail to the Depositary and must include a guarantee
by an Eligible Institution and a representation that the Stockholder owns the
Shares tendered within the meaning of, and that the tender of the Shares
effected thereby complies with, Rule 14e-4 under the Exchange Act, each in the
form set forth in the Notice of Guaranteed Delivery.
8
<PAGE>
THE METHOD OF DELIVERY OF ANY DOCUMENTS, INCLUDING SHARE CERTIFICATES, THE
LETTER OF TRANSMITTAL AND ANY OTHER REQUIRED DOCUMENTS, IS AT THE OPTION AND
SOLE RISK OF THE TENDERING STOCKHOLDER. IF DOCUMENTS ARE SENT BY MAIL,
REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS
RECOMMENDED. Stockholders have the responsibility to cause their Shares
tendered (in proper certificated or uncertificated form), the Letter of
Transmittal (or a copy or facsimile thereof) properly completed and bearing
original signature(s) and the original of any required signature guarantee(s),
any other documents required by the Letter of Transmittal and the Processing
Fee, to be timely delivered. Timely delivery is a condition precedent to
acceptance of Shares for purchase pursuant to the Offer and to payment of the
purchase amount.
Notwithstanding any other provision hereof, payment for Shares accepted for
payment pursuant to the Offer will in all cases be made only after timely
receipt by the Depositary of Share certificates evidencing such Shares or a
Book-Entry Confirmation of the delivery of such Shares (if available), a
Letter of Transmittal (or a copy or facsimile thereof) properly completed and
bearing original signature(s) and the original of any required signature
guarantee(s) or, in the case of a book-entry transfer, an Agent's Message, any
other documents required by the Letter of Transmittal and the Processing Fee.
f. Determinations of Validity. All questions as to the validity, form,
eligibility (including time of receipt) and acceptance of tenders will be
determined by the Fund, in its sole discretion, which determination shall be
final and binding. The Fund reserves the absolute right to reject any or all
tenders determined not to be in appropriate form or not accompanied by the
Processing Fee or to refuse to accept for payment, purchase, or pay for, any
Shares if, in the opinion of the Fund's counsel, accepting, purchasing or
paying for such Shares would be unlawful. The Fund also reserves the absolute
right to waive any of the conditions of the Offer or any defect in any tender,
whether generally or with respect to any particular Share(s) or
Stockholder(s). The Fund's interpretations of the terms and conditions of the
Offer shall be final and binding.
NEITHER THE FUND, ITS BOARD OF DIRECTORS, THE INVESTMENT ADVISER, THE
DEPOSITARY NOR ANY OTHER PERSON IS OR WILL BE OBLIGATED TO GIVE ANY NOTICE OF
ANY DEFECT OR IRREGULARITY IN ANY TENDER, AND NONE OF THEM WILL INCUR ANY
LIABILITY FOR FAILURE TO GIVE ANY SUCH NOTICE.
g. United States Federal Income Tax Withholding. To prevent the imposition
of U.S. federal backup withholding tax equal to 31% of the gross payments made
pursuant to the Offer, prior to such payments each Stockholder accepting the
Offer who has not previously submitted to the Fund a correct, completed and
signed Form W-9 (for U.S. Stockholders) or Form W-8 (for non-U.S.
Stockholders), or otherwise established an exemption from such withholding,
must submit the appropriate form to the Depositary. See Section 14.
Under certain circumstances (see Section 14), the Depositary will withhold a
tax equal to 30% of the gross payments payable to a non-U.S. Stockholder
unless the Depositary determines that a reduced rate of withholding or an
exemption from withholding is applicable. (Exemption from backup withholding
tax does not exempt a non-U.S. Stockholder from the 30% withholding tax.) For
this purpose, a non-U.S. Stockholder, is, in general, a Stockholder that is
not (i) a citizen or resident of the United States, (ii) a corporation,
partnership or other entity created or organized in or under the laws of the
United States or any political subdivision thereof, or (iii) an estate or
trust the income of which is subject to United States federal income taxation
regardless of the source of such income (a "Non-U.S. Stockholder"). The
Depositary will determine a Stockholder's status as a Non-U.S. Stockholder and
eligibility for a reduced rate of, or an exemption from, withholding by
reference to any outstanding certificates or statements concerning eligibility
for a reduced rate of, or exemption from, withholding, unless facts and
circumstances indicate that such reliance is not warranted. A Non-U.S.
Stockholder that has not previously submitted the appropriate certificates or
statements with respect to a reduced rate of, or exemption from, withholding
for which such Stockholder may be eligible should consider doing so in order
to avoid over-withholding. See Section 14.
9
<PAGE>
5. Withdrawal Rights. At any time prior to 5:00 P.M. Eastern Time on the
second day on which the NYSE is open for trading after the Expiration Date,
and, if the Shares have not by then been accepted for payment by the Fund, at
any time after February 5, 1998, any Stockholder may withdraw all, but not
less than all, of the Shares that the Stockholder has tendered.
To be effective, a written notice of withdrawal of Shares tendered must be
timely received by the Depositary at the appropriate address set forth on page
2 of this Offer. Stockholders may also send a facsimile transmission notice of
withdrawal, which must be timely received by the Depositary at (617) 794-6352,
and the original notice of withdrawal must be delivered to the Depositary by
overnight courier or by hand the next day. Any notice of withdrawal must
specify the name(s) of the person having tendered the Shares to be withdrawn,
the number of Shares to be withdrawn (which may not be less than all of the
Shares tendered by the Stockholder--see Sections 1 and 14) and, if one or more
certificates representing such Shares have been delivered or otherwise
identified to the Depositary, the name(s) of the registered owner(s) of such
Shares as set forth in such certificate(s) if different from the name(s) of
the person tendering the Shares. If one or more certificates have been
delivered to the Depositary, then, prior to the release of such
certificate(s), the certificate number(s) shown on the particular
certificate(s) evidencing such Shares must also be submitted and the signature
on the notice of withdrawal must be guaranteed by an Eligible Institution.
All questions as to the validity, form and eligibility (including time of
receipt) of notices of withdrawal will be determined by the Fund in its sole
discretion, which determination shall be final and binding. Shares properly
withdrawn will not thereafter be deemed to be tendered for purposes of the
Offer. Withdrawn Shares, however, may be retendered by following the
procedures described in Section 4 prior to 12:00 Midnight Eastern Time on the
Expiration Date. Except as otherwise provided in this Section 5, tenders of
Shares made pursuant to the Offer will be irrevocable.
NEITHER THE FUND, ITS BOARD OF DIRECTORS, THE INVESTMENT ADVISER, THE
DEPOSITARY NOR ANY OTHER PERSON IS OR WILL BE OBLIGATED TO GIVE ANY NOTICE OF
ANY DEFECT OR IRREGULARITY IN ANY NOTICE OF WITHDRAWAL, NOR SHALL ANY OF THEM
INCUR ANY LIABILITY FOR FAILURE TO GIVE ANY SUCH NOTICE.
6. Payment for Shares. For purposes of the Offer, the Fund will be deemed to
have accepted for payment and purchased Shares that are tendered (and not
withdrawn in accordance with Section 5 pursuant to the Offer) when, as and if
it gives oral or written notice to the Depositary of its acceptance of such
Shares for payment pursuant to the Offer. Under the Exchange Act, the Fund is
obligated to pay for or return tendered Shares promptly after the termination,
expiration or withdrawal of the Offer. Upon the terms and subject to the
conditions of the Offer, the Fund will pay for Shares properly tendered as
soon as practicable after the Expiration Date. The Fund will make payment for
Shares purchased pursuant to the Offer by depositing the aggregate purchase
price therefor with the Depositary, which will make payment to Stockholders
promptly as directed by the Fund. The Fund will not pay interest on the
purchase price under any circumstances.
In all cases, payment for Shares purchased pursuant to the Offer will be
made only after timely receipt by the Depositary of: (a) a Letter of
Transmittal (or a copy thereof) properly completed and bearing original
signature(s) and any required signature guarantee(s), (b) such Shares (in
proper certificated or uncertificated form), (c) any other documents required
by the Letter of Transmittal and (d) the Processing Fee. Stockholders may be
charged a fee by a broker, dealer or other institution for processing the
tender requested. Certificates representing Shares tendered but not purchased
will be returned promptly following the termination, expiration or withdrawal
of the Offer, without further expense to the tendering Stockholder. The Fund
will pay any transfer taxes payable on the transfer to it of Shares purchased
pursuant to the Offer. If, however, tendered Shares are registered in the name
of any person other than the person signing the Letter of Transmittal, the
amount of any such transfer taxes (whether imposed on the registered owner or
such other person) payable on account of the transfer to such person of such
Shares will be deducted from the purchase price unless satisfactory evidence
of the payment of such taxes, or exemption therefrom, is submitted. The Fund
may not be obligated to purchase Shares pursuant to the Offer under certain
conditions. See Section 3.
10
<PAGE>
Any tendering Stockholder or other payee who has not previously submitted a
correct, completed and signed Form W-8 or Form W-9, as necessary, and who
fails to complete fully and sign either the Form W-8 or Substitute Form W-9 in
the Letter of Transmittal and provide that form to the Depositary, may be
subject to federal backup withholding tax of 31% of the gross proceeds paid to
such Stockholder or other payee pursuant to the Offer. See Section 14
regarding this tax as well as possible withholding at the rate of 30% (or
lower applicable treaty rate) on the gross proceeds payable to tendering Non-
U.S. Stockholders.
7. Source and Amount of Funds. The total cost to the Fund of purchasing
1,297,906 of its issued and outstanding Shares pursuant to the Offer would be
approximately $22,440,795 (based on a price per Share of $17.29, the NAV as of
the close of the regular trading session of the NYSE on December 5, 1997). On
December 5, 1997, the aggregate value of the Fund's net assets was
approximately $149,639,000.
To pay the aggregate purchase price of Shares accepted for payment pursuant
to the Offer, the Fund anticipates that funds will first be derived from any
cash on hand and then from the proceeds from the sale of portfolio securities
held by the Fund. The selection of which portfolio securities to sell, if any,
will be made by the Investment Adviser, taking into account investment merit,
relative liquidity and applicable investment restrictions and legal
requirements. Although the Fund is authorized to borrow money to finance the
repurchase of Shares, the Board believes that the Fund will have sufficient
resources through cash on hand and the disposition of assets to repurchase
Shares in the Offer without utilizing such borrowing. However, the Fund
reserves the right to finance a portion of the Offer through temporary
borrowing.
The repurchase of Shares by the Fund will decrease the net assets of the
Fund and, therefore, have the effect of increasing the Fund's expense ratio.
In addition, the repurchases may have an adverse effect on the Fund's
investment performance.
Because the Fund may sell portfolio securities to raise cash for the
purchase of Shares, during the pendency of the Offer, and possibly for a short
time thereafter, the Fund may hold a greater than normal percentage of its
assets in cash and cash equivalents, which would tend to decrease the Fund's
net income. As of December 5, 1997, cash and cash equivalents constituted a
negligible percentage of the Fund's total assets.
Under some market circumstances, it may be necessary for the Fund to raise
cash by liquidating portfolio securities in a manner that could reduce the
market value of such securities and, thus, reduce both the NAV of the Shares
and the proceeds from the sale of such securities. Liquidating portfolio
securities, if necessary, may also lead to the premature disposition of
portfolio investments and additional transaction costs. Depending upon the
timing of such sales, any such decline in NAV may adversely affect any
tendering Stockholders whose Shares are accepted for purchase by the Fund, as
well as those Stockholders who do not sell Shares pursuant to the Offer.
Stockholders who retain their Shares may be subject to certain other effects
of the Offer. See Section 11.
11
<PAGE>
8. Price Range of Shares; Dividends. The following table sets forth, for the
periods indicated, the high and low NAVs per Share and the high and low
closing sale prices per Share as reported on the NYSE Composite Tape, and the
amounts of cash dividends per Share declared during such periods.
<TABLE>
<CAPTION>
NET ASSET VALUE MARKET PRICE
--------------- ----------------
FISCAL YEAR (ENDING OCTOBER 31) HIGH LOW HIGH LOW DIVIDENDS
- ------------------------------- --------------- -------- ------- ---------
<S> <C> <C> <C> <C> <C>
1996
1st Quarter......................... $ 14.03 $ 11.64 $13.7500 $11.375 $.4800
2nd Quarter......................... 14.27 12.26 14.0000 12.000 .2150
3rd Quarter......................... 13.80 12.87 13.1250 12.500 .3225
4th Quarter......................... 15.64 14.00 13.9370 13.000 .3225
1997
1st Quarter......................... 16.72 15.63 14.8750 13.625 .5075
2nd Quarter......................... 17.46 15.31 15.5000 13.750 .3225
3rd Quarter......................... 18.19 16.36 16.9375 14.625 .3625
4th Quarter......................... 18.60 16.03 17.5625 15.875 .3825
1998
1st Quarter (through December 5,
1997).............................. 17.29 15.71 16.8750 15.3750 .1275
</TABLE>
Since trading of the Shares commenced on the NYSE, the Shares have traded at
both a premium and a discount to NAV. As of the close of business on December
5, 1997, the Fund's NAV was $17.29 per Share, and the high, low and closing
prices per Share on the NYSE on that date were $16.75, $16.625 and $16.6875,
respectively. During the pendency of the Offer, current NAV quotations can be
obtained by contacting the Depositary in the manner indicated in Section 1.
The Board of Directors has declared dividends payable January 16, 1998 to
Stockholders of record at the close of business on December 30, 1997, the ex-
dividend date for which is December 26, 1997. The tendering of Shares will not
affect the record ownership of the tendered Shares for purposes of entitlement
to these dividends.
12
<PAGE>
9. Selected Financial Information. Set forth below is a summary of selected
financial information for the Fund as of and for the fiscal years ended
October 31, 1997 and October 31, 1996 which has been excerpted from the Fund's
audited financial statements contained in its Annual Reports to Stockholders
for these years. A copy of the two audited statements is included as Exhibit A
to this Offer to Purchase. The summary of selected financial information set
forth below is qualified in its entirety by reference to these statements and
the financial information, the notes thereto and related matter contained
therein.
SUMMARY OF SELECTED FINANCIAL INFORMATION
FOR THE PERIODS INDICATED BELOW
($ IN 000'S EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
OCTOBER 31, 1997 OCTOBER 31, 1996
---------------- ----------------
(AUDITED) (AUDITED)
<S> <C> <C>
STATEMENT OF OPERATIONS
Investment income.......................... $ 15,983 $ 14,603
Expenses................................... 2,087 1,985
--------- ---------
Net investment income...................... 13,896 12,618
--------- ---------
Realized and unrealized gain on investments
and options............................... 4,301 30,360
--------- ---------
Net increase in net assets from
operations................................ $ 18,197 $ 42,978
========= =========
STATEMENT OF ASSETS AND LIABILITIES
(AT END OF PERIOD)
Total assets............................... $231,318 $230,970
Total liabilities.......................... 92,609 96,830
--------- ---------
Net assets................................. $138,709 $134,140
========= =========
Net asset value per Share.................. $16.03 $15.50
Shares outstanding......................... 8,652,707 8,652,707
SELECTED DATA PER SHARE OUTSTANDING
THROUGHOUT EACH PERIOD
Net investment income...................... $ 1.61 $ 1.46
Net realized and unrealized gain on
investments............................... .50 3.50
--------- ---------
Net increase in net asset value from
operations................................ 2.11 4.96
--------- ---------
Dividends from net investment income....... $(1.58) $(1.34)
========= =========
Total dividends............................ $(1.58) $(1.34)
========= =========
RATIOS
Expenses to average net assets............. 1.43% 1.70%
Net investment income to average net
assets.................................... 9.50% 10.84%
TOTAL INVESTMENT RETURN*
Total investment return based on:
Market value............................... 28.74% 28.49%
Net asset value............................ 14.24% 44.57%
</TABLE>
- --------
* Total investment return is calculated assuming a purchase of Shares on the
opening of the first day and a sale on the closing of the last day of the
period reported. Dividends and distributions, if any, are assumed for
purposes of this calculation to be reinvested at prices obtained under the
Fund's Dividend Reinvestment Plan. Generally, total investment return based
on net asset value will be higher than the total investment return based on
market value in periods where there is an increase in the discount or a
decrease in the premium of the market value to the net asset value from the
beginning to the end of such periods. Conversely, total investment return
based on net asset value will be lower than total investment return based on
market value in periods where there is a decrease in the discount or an
increase in the premium of the market value to the net asset value from the
beginning to the end of such periods. Total investment return calculated for
a period of less than one full year is not annualized.
13
<PAGE>
10. Interest of Certain Related Persons. Pursuant to an Advisory Agreement
dated as of October 29, 1992 with the Investment Adviser (a copy of which has
been filed as an exhibit to Schedule 13E-4 as defined in Section 13), the Fund
employs the Investment Adviser to manage the investment and reinvestment of
the assets of the Fund. The Investment Adviser has been the Fund's investment
adviser since the Fund's commencement of operations and is responsible for the
overall management of the business affairs of the Fund. Pursuant to an
Administration Agreement made as of October 1, 1994 with the Investment
Adviser (a copy of which has also been filed as an exhibit to Schedule 13E-4),
the Investment Adviser also provides various administrative services to the
Fund. For services provided by the Investment Adviser under the Advisory
Agreement, the Fund pays the Investment Adviser a fee at an annualized rate of
1.00% of the Fund's average weekly net assets. For services provided by the
Investment Adviser under the Administration Agreement, the Fund pays the
Investment Adviser a fee at an annual rate of .15 of 1% of the Fund's average
weekly net assets. Both fees are calculated and paid monthly in arrears on the
last day of each calendar month for services performed during that month. For
purposes of the calculation of both fees, average weekly net assets are
determined on the basis of the average net assets of the Fund for each weekly
period (ending on Friday) ending during the month. The net assets for each
weekly period are determined by averaging the net assets on Friday of such
weekly period with the net assets on Friday of the immediately preceding
weekly period. When a Friday is not a Fund business day, the calculation is to
be based on the net assets of the Fund on the Fund business day immediately
preceding such Friday. During the fiscal year ended October 31, 1997, the Fund
paid the Investment Adviser a fee totalling $1,462,820 pursuant to the
Advisory Agreement and a fee totalling $219,424 pursuant to the Administration
Agreement. The Fund is also party to a Shareholder Inquiry Agency Agreement
dated as of November 28, 1995 with Alliance Fund Services, Inc. ("Services"),
an affiliate of the Investment Adviser. Pursuant to this agreement (a copy of
which has also been filed as an exhibit to Schedule 13E-4), Services responds
to telephone inquiries concerning the Fund and matters relating thereto from
Stockholders and others. The fees payable to Services under this agreement are
limited to the cost to Services of providing the services involved. During the
fiscal year ended October 31, 1997, the cost reimbursement to Services under
this agreement totalled $5,500.
During the past forty business days, there have not been any transactions
involving Shares that were effected by the Fund, nor, based upon information
provided to the Fund, any transactions in Shares that were effected by any
member of the Board, any executive officer of the Fund, any director or
executive officer of the general partner of the Investment Adviser, any person
controlling the Fund, any director or executive officer of any corporation
ultimately in control of the Fund, or any associate or subsidiary of any of
the foregoing, including any executive officer or director of any such
subsidiary. There is a policy applicable to all investment companies to which
the Investment Adviser provides investment advisory services contemplating, in
the case of the Fund and those other such companies of which directors of the
Fund are also directors, that each such director will invest at least $10,000
in shares of any one or more of the Fund and such companies, and at least
$150,000 in shares of at least five such companies, including the Fund, before
the end of 1997. As of December 5, 1997, the directors of the Fund as a group
owned less than 1% of the Shares. Based upon information provided to the Fund,
no director or officer of the Fund intends to tender Shares pursuant to the
Offer.
11. Certain Effects of the Offer. The purchase of Shares pursuant to the
Offer will have the effect of increasing the proportionate interest in the
Fund of Stockholders who do not tender Shares. All Stockholders remaining
after the Offer will be subject to any increased risks associated with the
reduction in the number of outstanding shares and the reduction in the Fund's
assets resulting from payment for the tendered Shares, such as any greater
volatility due to decreased portfolio diversification and proportionately
higher expenses. Under certain circumstances, the need to raise cash in
connection with the purchase of Shares pursuant to the Offer may have an
adverse effect on the Fund's NAV and/or income per Share. See Section 7. In
addition, the purchase of Shares from tendering Stockholders may have tax
consequences to the Fund in certain circumstances. See Section 14. All Shares
purchased by the Fund pursuant to the Offer will be retired and will be
authorized and unissued shares.
12. Certain Information about the Fund. The Fund was incorporated in
Maryland on August 20, 1992 and is registered as a non-diversified, closed-end
management investment company under the 1940 Act. The Fund's investment
objective is to seek high current income by investing exclusively in fixed
income securities denominated in U.S. dollars. In seeking to achieve this
objective, the Fund invests substantially all of its assets
14
<PAGE>
in (a) U.S. dollar-denominated debt obligations issued or guaranteed by
foreign governments, including participations in loans between foreign
governments and financial institutions, and interests in entities organized
and operated for the purpose of restructuring the investment characteristics
of instruments issued or guaranteed by foreign governments and (b) zero coupon
obligations issued or guaranteed by the U.S. government, its agencies or
instrumentalities.
Reference is made to Sections 2, 8 and 9 and to the financial statements
referred to in Section 9.
The principal executive office of the Fund is located at 1345 Avenue of the
Americas, New York, New York 10105.
13. Additional Information. An Issuer Tender Offer Statement on Schedule
13E-4 (the "Schedule 13E-4") including the exhibits thereto, filed with the
Securities and Exchange Commission (the "SEC"), provides certain additional
information relating to the Offer, and may be inspected and copied at the
prescribed rates at the SEC's public reference facilities at 450 Fifth Street,
N.W., Room 1024, Washington, D.C. 20549, 7 World Trade Center, Suite 1300, New
York, New York 10048 and Citicorp Center, 500 W. Madison Street, Suite 1400,
Chicago, Illinois 60661-2511. Copies of the Schedule 13E-4 and the exhibits
may also be obtained by mail at the prescribed rates from the Public Reference
Branch of the SEC at 450 Fifth Street, N.W., Washington, D.C. 20549.
14. Certain United States Federal Income Tax Consequences. The following
discussion is a general summary of the U.S. federal income tax consequences of
a sale of Shares pursuant to the Offer based on current U.S. Federal income
tax law, including applicable Treasury regulations and Internal Revenue
Service rulings. Each Stockholder should consult the Stockholder's tax advisor
for a full understanding of the tax consequences of such a sale, including
potential state, local and foreign taxation by jurisdictions of which the
Stockholder is a citizen, resident or domiciliary. In view of the requirement
of the Offer that a tendering Stockholder must tender, or cause the tender of,
both all of the Shares owned by the Stockholder and all of the Shares
attributed to the Stockholder under Section 318 of the Code as of the date of
purchase of Shares by the Fund pursuant to the Offer, tax advisors should also
be consulted regarding the application of the constructive ownership rules of
Section 318. In general, Section 318 provides that Shares owned by certain
family members of a tendering Stockholder, and by certain entities in which
the Stockholder has a direct or indirect interest, are treated as owned by the
Stockholder.
U.S. Stockholders. It is anticipated that Stockholders who are citizens
and/or residents of the U.S., corporations, partnerships or other entities
created or organized in or under the laws of the U.S. or any political
subdivision thereof, and estates and trusts the income of which is subject to
U.S. federal income taxation regardless of the source of such income ("U.S.
Stockholders") and who sell Shares pursuant to the Offer will recognize gain
or loss for U.S. federal income tax purposes equal to the difference between
the amount of cash they receive pursuant to the Offer and their adjusted tax
basis in the Shares sold. This gain or loss will be capital gain or loss if
the Shares sold are held by the tendering U.S. Stockholder at the time of sale
as a capital asset and will be treated as either long-term or short-term if
the Shares have been held at that time for more than one year or one year or
less, respectively. Any such long-term capital gain realized by a non-
corporate U.S. Stockholder will be taxed at a maximum rate of 28% if the
Shares had been held for more than one year but not more than 18 months at the
time of their sale pursuant to the Offer and will be taxed at a maximum rate
of 20% if the Shares had been held for more than 18 months at the time of such
sale. This U.S. federal income tax treatment, however, is based on the
expectation that not all Stockholders will tender their Shares pursuant to the
Offer and that the continuing ownership interest in the Fund of tendering
Stockholders will be sufficiently reduced. While not anticipated, it is
therefore possible that the cash received for the Shares purchased would be
taxable as a distribution by the Fund, rather than as a gain from the sale of
the Shares. In that event, the cash received by a U.S. Stockholder will be
taxable as a dividend, i.e., as ordinary income, to the extent of the U.S.
Stockholder's allocable share of the Fund's current or accumulated earnings
and profits, with the excess of the cash received over the portion so taxable
constituting a non-taxable return of capital to the extent of the U.S.
Stockholder's tax basis in the Shares sold and with any remaining excess of
such cash being treated as either long-term or short-
15
<PAGE>
term capital gain from the sale of the Shares depending on how long they were
held by the U.S. Stockholder. In the case of a tendering U.S. Stockholder that
is a corporation treated as receiving a distribution from the Fund pursuant to
the Offer, special basis adjustments may be applicable with respect to any
Shares of such a U.S. Stockholder not purchased pursuant to the Offer.
Under the "wash sale" rules under the Code, recognition of a loss on Shares
sold pursuant to the Offer will ordinarily be disallowed to the extent a U.S.
Stockholder acquires Shares within 30 days before or after the date the Shares
are purchased pursuant to the Offer and, in that event, the basis and holding
period of the Shares acquired will be adjusted to reflect the disallowed loss.
The Depositary may be required to withhold 31% of the gross proceeds paid to
a U.S. Stockholder or other payee pursuant to the Offer unless either: (a) the
U.S. Stockholder has completed and submitted to the Depositary an IRS Form W-9
(or Substitute Form W-9), providing the U.S. Stockholder's employer
identification number or social security number as applicable, and certifying
under penalties of perjury: (a) that such number is correct; (b) either that
(i) the U.S. Stockholder is exempt from backup withholding, (ii) the U.S.
Stockholder has not been notified by the Internal Revenue Service that the
U.S. Stockholder is subject to backup withholding as a result of an under-
reporting of interest or dividends, or (iii) the Internal Revenue Service has
notified the U.S. Stockholder that the U.S. Stockholder is no longer subject
to backup withholding; or (c) an exception applies under applicable law. A
Substitute Form W-9 is included as part of the Letter of Transmittal for U.S.
Stockholders.
Non-U.S. Stockholders. The U.S. federal income taxation of a Non-U.S.
Stockholder on a sale of Shares pursuant to the Offer depends on whether this
transaction is "effectively connected" with a trade or business carried on in
the U.S. by the Non-U.S. Stockholder as well as the tax characterization of
the transaction as either a sale of the Shares or a distribution by the Fund,
as discussed above for U.S. Stockholders. If the sale of Shares pursuant to
the Offer is not so effectively connected and if, as anticipated for U.S.
Stockholders, it gives rise to gain or loss, any gain realized by a Non-U.S.
Stockholder upon the tender of Shares pursuant to the Offer will not be
subject to U.S. federal income tax or to any U.S. tax withholding, provided,
however, that such a gain will be subject to U.S. federal income tax at the
rate of 30% (or such lower rate as may be applicable under a tax treaty) if
the Non-U.S. Stockholder is a non-resident alien individual who is physically
present in the United States for more than 182 days during the taxable year of
the sale. If, however, U.S. Stockholders are deemed to receive a distribution
from the Fund with respect to Shares they tender, the cash received by a
tendering Non-U.S. Stockholder will also be treated for U.S. tax purposes as a
distribution by the Fund, with the cash then being characterized in the same
manner as described above for U.S. Stockholders. In such an event, the portion
of the distribution treated as a dividend to the Non-U.S. Stockholder would be
subject to a U.S. withholding tax at the rate of 30% (or such lower rate as
may be applicable under a tax treaty) if the dividend does not constitute
effectively connected income. If the amount realized on the tender of Shares
by a Non-U.S. Stockholder is effectively connected income, regardless of
whether the tender is characterized as a sale or as giving rise to a
distribution from the Fund for U.S. federal income tax purposes, the
transaction will be treated and taxed in the same manner as if the Shares
involved were tendered by a U.S. Stockholder.
Non-U.S. Stockholders should provide the Depositary with a completed Form W-
8 in order to avoid 31% backup withholding on the cash they receive from the
Fund regardless of how they are taxed with respect to their tender of the
Shares involved. A copy of Form W-8 is provided with the Letter of Transmittal
for Non-U.S. Stockholders.
15. Amendments; Extension of Tender Period; Termination. The Fund reserves
the right, at any time during the pendency of the Offer, to amend, extend or
terminate the Offer in any respect. Without limiting the manner in which the
Fund may choose to make a public announcement of such an amendment, extension
or termination, the Fund shall have no obligation to publish, advertise or
otherwise communicate any such public announcement, except as provided by
applicable law (including Rule 14e-1(d) promulgated under the Exchange Act)
and by the requirements of the NYSE (including the listing agreement with
respect to the Shares).
16
<PAGE>
Except to the extent required by applicable law (including Rule 13e-4(f)(1)
promulgated under the Exchange Act), the Fund will have no obligation to
extend the Offer. In the event that the Fund is obligated to, or elects to,
extend the Offer, the purchase price for Shares purchased pursuant to the
Offer will be their NAV determined as of the close of the regular trading
session of the NYSE on the Expiration Date as extended. No Shares will be
accepted for payment until on or after the new Expiration Date.
16. Miscellaneous. The Offer is not being made to, nor will the Fund accept
tenders from, or on behalf of, owners of Shares in any jurisdiction in which
the making of the Offer or its acceptance would not comply with the securities
or "blue sky" laws of that jurisdiction. The Fund is not aware of any
jurisdiction in which the making of the Offer or the acceptance of tenders of,
purchase of, or payment for, Shares in accordance with the Offer would not be
in compliance with the laws of such jurisdiction. The Fund, however, reserves
the right to exclude Stockholders in any jurisdiction in which it is asserted
that the Offer cannot lawfully be made or tendered Shares cannot lawfully be
accepted, purchased or paid for. So long as the Fund makes a good-faith effort
to comply with any state law deemed applicable to the Offer, the Fund believes
that the exclusion of holders residing in any such jurisdiction is permitted
under Rule 13e-4(f)(9) promulgated under the Exchange Act. In any jurisdiction
where the securities, blue sky or other laws require the Offer to be made by a
licensed broker or dealer, the Offer shall be deemed to be made on the Fund's
behalf by one or more brokers or dealers licensed under the laws of such
jurisdiction.
December 10, 1997
Alliance World Dollar Government Fund, Inc.
1345 Avenue of the Americas
New York, New York 10105
17
<PAGE>
EXHIBIT A
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1997 ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
(000) U.S. $VALUE
- --------------------------------------------------------------------------------
<S> <C> <C>
SOVEREIGN DEBT
OBLIGATIONS-106.5%
COLLATERALIZED
BRADY BONDS(A)-85.9%
ARGENTINA-15.7%
Republic of Argentina
Euro Par Bonds
5.50%, 3/31/23(b)....................................... $32,000 $ 21,800,000
------------
BRAZIL-16.3%
Republic of Brazil
Discount Bonds FRN
Series Z-L
6.6875%, 4/15/24........................................ 19,160 14,370,000
Par Bonds
Series Z-L
5.25%, 4/15/24(b)....................................... 12,700 8,278,812
------------
22,648,812
------------
BULGARIA-6.3%
Republic of Bulgaria
Discount Bonds FRN
6.6875%, 7/28/24........................................ 12,500 8,656,250
------------
ECUADOR-3.6%
Republic of Ecuador
Discount Bonds FRN
6.6875%, 2/28/25(b)..................................... 7,400 4,995,000
------------
JORDAN-5.4%
Republic of Jordan
Par Bonds
4.00%, 12/23/23(b)...................................... 11,200 7,448,000
------------
MEXICO-18.4%
United Mexican States
Discount Bonds FRN
Series B
6.83594%, 12/31/19(c)................................... 10,240 9,152,000
Discount Bonds FRN
Series D
6.8125%, 12/31/19(c).................................... 6,000 5,362,500
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
(000) U.S. $VALUE
<S> <C> <C>
Euro Par Bonds
Series A
6.25%, 12/31/19(c)..................................... $ 8,600 $ 6,740,250
Euro Par Bonds
Series B
6.25%, 12/31/19(c)..................................... 5,500 4,310,625
------------
25,565,375
------------
NIGERIA-5.7%
Central Bank of Nigeria
Par Bonds
6.25%, 11/15/20(d)..................................... 12,000 7,920,000
------------
POLAND-3.4%
Republic of Poland
Discount Bonds FRN
6.6875%, 10/27/24...................................... 5,000 4,693,750
------------
VENEZUELA-11.1%
Republic of Venezuela
Discount Bonds FRN
Series A
6.75%, 3/31/20(e)...................................... 13,000 11,342,500
Par Bonds
Series W-A
6.75%, 3/31/20(e)...................................... 4,900 4,097,625
------------
15,440,125
------------
Total Collateralized
Brady Bonds
(cost $119,601,124).................................... 119,167,312
------------
LOAN PARTICIPATION & ASSIGNMENT-7.7%
ALGERIA-1.9%
Algeria Refinancing Trust FRN
Loan Assignment Tranche B
6.6875%, 9/05/05....................................... 3,000 2,550,000
------------
</TABLE>
A-1
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED) ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
(000) U.S. $VALUE
- -------------------------------------------------------------------------------
<S> <C> <C>
MOROCCO-5.8%
Kingdom of Morocco
Loan Participation FRN
Series A
6.8125%, 1/01/09....................................... $10,000 $ 8,062,500
------------
Total Loan Participation &
Assignment
(cost $7,129,070)...................................... 10,612,500
------------
OTHER SOVEREIGN DEBT OBLIGATIONS-6.7%
RUSSIA-6.7%
Russia Principal Loans-WI
FRN 12/15/20(f)(g)
(cost $10,882,500)..................................... 15,800 9,322,000
------------
NON-COLLATERALIZED BRADY BONDS-6.2%
BRAZIL-2.3%
Republic of Brazil C-Bonds
8.00%, 4/15/14(h)...................................... 4,675 3,154,209
------------
PANAMA-2.5%
Republic of Panama IRB
3.75%, 7/17/14(b)...................................... 5,000 3,525,000
------------
PERU-1.4%
Republic of Peru FLIRB
3.25%, 3/07/17(b)(f)................................... 1,500 750,000
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
(000) U.S. $VALUE
<S> <C> <C>
Republic of Peru PDI
4.00%, 3/07/17(b)(f).................................... $2,000 $ 1,130,000
------------
1,880,000
------------
Total Non-Collateralized Brady Bonds
(cost $9,049,726)....................................... 8,559,209
------------
Total Sovereign Debt Obligations
(cost $146,662,420)..................................... 147,661,021
------------
U.S. GOVERNMENT OBLIGATION-34.1%
U.S. Treasury Strip
Zero coupon, 2/15/03
(cost $47,646,006)...................................... 64,000 47,340,160
------------
TIME DEPOSIT-0.3%
Bank of New York
5.1875%, 11/03/97
(cost $377,000)......................................... 377 377,000
------------
TOTAL INVESTMENTS-140.9%
(cost $194,685,426)..................................... 195,378,181
Other assets less liabilities-(40.9%).................... (56,669,199)
------------
NET ASSETS-100%.......................................... $138,708,982
============
</TABLE>
- --------------------------------------------------------------------------------
(a) Sovereign debt obligations issued as part of debt restructurings that are
collateralized in full as to principal due at maturity by U.S. Treasury
zero coupon obligations which have the same maturity as the Brady Bond.
(b) Coupon increases periodically based upon a predetermined schedule. Stated
interest rate in effect at October 31, 1997.
(c) Security trades with value recovery rights expiring June 30, 2003.
(d) Security trades with oil warrants expiring November 15, 2020.
(e) Security trades with oil warrants expiring April 15, 2020.
(f) Securities are exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At October 31,
1997 these securities amounted to $11,202,000 or 8.1% of net assets.
(g) An interest rate based on the six-month Libor Rate plus 81.25 basis points
will take effect upon issuance of bonds.
(h) Coupon consists of 4.50% cash payment and 3.50% paid-in-kind.
Glossary of Terms:
FLIRB - Front Loaded Interest Reduction Bond.
FRN - Floating Rate Note.
IRB - Interest Reduction Bond.
PDI - Past Due Interest.
WI - When Issued.
See notes to financial statements.
A-2
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 31, 1997 ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS
Investments in securities, at value (cost $194,685,426).......... $195,378,181
Cash............................................................. 23,178
Receivable for investment securities sold........................ 33,229,138
Interest receivable.............................................. 2,683,550
Deferred organization expenses and other assets.................. 4,098
------------
Total assets..................................................... 231,318,145
------------
LIABILITIES
Payable for investment securities purchased...................... 91,632,890
Unrealized depreciation on interest rate swap contract........... 674,196
Advisory fee payable............................................. 130,440
Administrative fee payable....................................... 19,566
Accrued expenses................................................. 152,071
------------
Total liabilities................................................ 92,609,163
------------
NET ASSETS........................................................ $138,708,982
============
COMPOSITION OF NET ASSETS
Capital stock, at par............................................ $ 86,527
Additional paid-in capital....................................... 119,218,745
Undistributed net investment income.............................. 2,761,040
Accumulated net realized gain on investments transactions........ 16,624,111
Net unrealized appreciation of investments and other assets...... 18,559
------------
$138,708,982
============
NET ASSET VALUE PER SHARE (based on 8,652,707 shares outstanding). $16.03
============
</TABLE>
- --------------------------------------------------------------------------------
See notes to financial statements.
A-3
<PAGE>
STATEMENT OF OPERATIONS
YEAR ENDED OCTOBER 31, 1997 ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME
Interest............................................. $ 15,982,991
EXPENSES
Advisory fee......................................... $1,462,820
Administrative fee................................... 219,424
Audit & legal........................................ 107,556
Custodian............................................ 103,406
Transfer agency...................................... 77,140
Directors' fees...................................... 36,112
Printing............................................. 24,965
Amortization of organization expenses................ 17,885
Registration......................................... 16,207
Taxes................................................ 10,800
Miscellaneous........................................ 10,253
----------
Total expenses....................................... 2,086,568
------------
Net investment income................................ 13,896,423
------------
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS
Net realized gain on investment transactions......... 23,952,946
Net change in unrealized appreciation of investments
and other assets.................................... (19,652,839)
------------
Net gain on investments.............................. 4,300,107
------------
NET INCREASE IN NET ASSETS FROM OPERATIONS............ $ 18,196,530
============
</TABLE>
- --------------------------------------------------------------------------------
See notes to financial statements.
A-4
<PAGE>
STATEMENT OF CHANGES
IN NET ASSETS ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
OCTOBER 31, OCTOBER 31,
1997 1996
------------ ------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income............................. $ 13,896,423 $ 12,618,227
Net realized gain on investment transactions...... 23,952,946 13,908,106
Net change in unrealized appreciation of
investments and other assets..................... (19,652,839) 16,452,008
------------ ------------
Net increase in net assets from operations........ 18,196,530 42,978,341
DIVIDENDS TO SHAREHOLDERS FROM:
Net investment income............................. (13,628,017) (11,594,630)
------------ ------------
Total increase.................................... 4,568,513 31,383,711
NET ASSETS
Beginning of year................................. 134,140,469 102,756,758
------------ ------------
End of year (including undistributed net
investment income of $2,761,040 and $2,492,634,
respectively).................................... $138,708,982 $134,140,469
============ ============
</TABLE>
- --------------------------------------------------------------------------------
See notes to financial statements.
A-5
<PAGE>
NOTES TO FINANCIAL STATEMENTS
OCTOBER 31, 1997 ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
- -------------------------------------------------------------------------------
NOTE A: SIGNIFICANT ACCOUNTING POLICIES
Alliance World Dollar Government Fund, Inc. (the "Fund") was incorporated un-
der the laws of the State of Maryland on August 20, 1992 and is registered un-
der the Investment Company Act of 1940, as a non-diversified, closed-end man-
agement investment company. The following is a summary of significant account-
ing policies followed by the Fund.
1. SECURITY VALUATION
Portfolio securities traded on a national securities exchange are valued at
the last sale price on such exchange on the day of valuation or, if there was
no sale on such day, the last bid price quoted on such day. Listed securities
not traded and securities traded in the over-the-counter market, including
listed debt securities whose primary market is believed to be over-the-count-
er, are valued at the mean between the most recently quoted bid and asked
price provided by the principal market makers. Publicly traded Sovereign Debt
Obligations are typically traded internationally on the over-the-counter mar-
ket. Due to the nature of the markets for Sovereign Debt Obligations, quota-
tions from several sources will be obtained so that the Fund's portfolio in-
vestments will not generally be priced by a single source. Readily marketable
Sovereign Debt Obligations may be valued on the basis of prices provided by a
pricing service when such prices are believed by the Adviser to reflect the
fair value of such securities. Securities for which market quotations are not
readily available and restricted securities are valued in good faith, at fair
value, using methods determined by the Board of Directors. Securities which
mature in 60 days or less are valued at amortized cost, which approximates
fair value, unless this method does not represent fair value.
2. ORGANIZATION EXPENSES
Organization expenses of approximately $90,000 have been deferred and are be-
ing amortized on a straight-line basis through November, 1997.
3. TAXES
It is the Fund's policy to meet the requirements of the Internal Revenue Code
applicable to regulated investment companies and to distribute all of its in-
vestment company taxable income and net realized gains, if any, to sharehold-
ers. Therefore, no provisions for federal income or excise taxes are required.
4. INVESTMENT INCOME AND INVESTMENT TRANSACTIONS
Interest income is accrued daily. Investment transactions are accounted for on
the date securities are purchased or sold. Investment gains and losses are de-
termined on the identified cost basis. The Fund accretes discount as an ad-
justment to interest income.
5. DIVIDENDS AND DISTRIBUTIONS
Dividends and distributions to shareholders are recorded on the ex-dividend
date. Income and capital gains distributions are determined in accordance with
federal tax regulations and may differ from those determined in accordance
with generally accepted accounting principles. To the extent these differences
are permanent, such amounts are reclassified within the capital accounts based
on their federal tax basis treatment; temporary differences, do not require
such reclassification.
- -------------------------------------------------------------------------------
NOTE B: ADVISORY AND ADMINISTRATIVE FEES
Under the terms of an Investment Advisory Agreement, the Fund pays Alliance
Capital Management L.P. (the "Adviser") an advisory fee equal to the
annualized rate of 1% of the Fund's average weekly net assets.
Under the terms of an Administration Agreement, the Fund pays Alliance Capital
Management L.P. (the "Administrator") a monthly fee equal to the annualized
rate of .15 of 1% of the Fund's average weekly net assets.
The Administrator provides administrative functions as well as other clerical
services to the Fund and prepares financial and regulatory reports.
The Fund entered into a Shareholder Inquiry Agency Agreement with Alliance
Fund Services, Inc. ("AFS"), an affiliate of the Adviser, whereby the Fund re-
imburses AFS for costs relating to servicing phone inquiries for the Fund.
During the year ended October 31, 1997, the Fund reimbursed AFS $5,500, relat-
ing to shareholder servicing costs.
A-6
<PAGE>
ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
- -------------------------------------------------------------------------------
NOTE C: INVESTMENT TRANSACTIONS
Purchases and sales of investment securities (excluding short-term investments
and U.S. government securities) aggregated $261,334,018 and $252,431,972, re-
spectively, for the year ended October 31, 1997. There were purchases of
$271,478,845 and sales of $268,486,865 of U.S. government obligations for the
year ended October 31, 1997.
At October 31, 1997, the cost of investments for federal income tax purposes
was $195,890,985. Accordingly, gross unrealized appreciation of investments
was $8,111,959 and gross unrealized depreciation of investments was $8,624,763
resulting in net unrealized depreciation of $512,804 (excluding swap con-
tracts).
1. INTEREST RATE SWAP AGREEMENT
The Fund enters into interest rate swaps on sovereign debt obligations to pro-
tect itself from interest rate fluctuations on the underlying floating rate
debt instruments and for investment purposes. A swap is an agreement that ob-
ligates two parties to exchange a series of cash flows at specified intervals
based upon or calculated by reference to changes in specified prices or rates
for a specified amount of an underlying asset. The payment flows are usually
netted against each other, with the difference being paid by one party to the
other.
Risks may arise as a result of the failure of another party to the swap con-
tract to comply with the terms of the swap contract. The loss incurred by the
failure of a counterparty is generally limited to the net interest payment to
be received by the Fund, and/or the termination value at the end of the con-
tract. Therefore, the Fund considers the creditworthiness of each counterparty
to a swap contract in evaluating potential credit risk. Additionally, risks
may arise from unanticipated movements in interest rates or in the value of
the underlying securities.
The Fund records a net receivable or payable on a daily basis for the net in-
terest income or expense expected to be received or paid in the interest peri-
od. Net interest received or paid on these contracts is recorded as interest
income (or as an offset to interest income). Fluctuations in the value of swap
contracts are recorded for financial statement purposes as unrealized appreci-
ation or depreciation of investments.
At October 31, 1997, the Fund had an outstanding interest rate swap contract
with the following terms:
<TABLE>
<CAPTION>
RATE TYPE
--------------------
PAYMENTS PAYMENTS
SWAP NOTIONAL TERMINATION MADE BY RECEIVED BY UNREALIZED
COUNTERPARTY AMOUNT DATE THE FUND THE FUND DEPRECIATION
------------ -------------- ----------- -------- ----------- ------------
<S> <C> <C> <C> <C> <C>
Morgan Guaranty US $12,000,000 1/01/09 LIBOR+ 6.8526% $674,196
</TABLE>
+ LIBOR (London Interbank Offered Rate).
- -------------------------------------------------------------------------------
NOTE D: CAPITAL STOCK
There are 100,000,000 shares of $0.01 par value Common Stock authorized.
Of the 8,652,707 shares outstanding at October 31, 1997, the Adviser owned
7,200 shares. During the years ended October 31, 1997 and 1996, the Fund did
not issue shares in connection with the dividend reinvestment plan.
A-7
<PAGE>
NOTES TO FINANCIAL STATEMENTS
(CONTINUED) ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
- -------------------------------------------------------------------------------
NOTE E: CONCENTRATION OF RISK
Investing in securities of foreign governments involves special risks which
include revaluation of currencies and the possibility of future adverse polit-
ical and economic developments. Moreover, securities of many foreign govern-
ments and their markets may be less liquid and their prices more volatile than
those of the United States government. The Fund invests in the sovereign debt
obligations of countries that are considered emerging market countries at the
time of purchase. Therefore, the Fund is susceptible to governmental factors
and economic and debt restructuring developments adversely affecting the econ-
omies of these emerging market countries. In addition, these debt obligations
may be less liquid and subject to greater volatility than debt obligations of
more developed countries.
A-8
<PAGE>
FINANCIAL HIGHLIGHTS ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
- --------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF COMMON STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
NOVEMBER 2,
YEAR ENDED OCTOBER 31, 1992(A) TO
--------------------------------------- OCTOBER 31,
1997 1996 1995 1994 1993
-------- -------- -------- ------- -----------
<S> <C> <C> <C> <C> <C>
Net asset value,
beginning of period.... $ 15.50 $ 11.88 $ 11.08 $ 22.09 $ 13.82(b)
-------- -------- -------- ------- --------
INCOME FROM INVESTMENT
OPERATIONS
- ------------------------
Net investment income... 1.61 1.46 1.51(c) 1.32 1.54
Net realized and
unrealized gain (loss)
on investments......... .50 3.50 .71 (5.66) 8.19
-------- -------- -------- ------- --------
Net increase (decrease)
in net asset value from
operations............. 2.11 4.96 2.22 (4.34) 9.73
-------- -------- -------- ------- --------
LESS: DIVIDENDS AND
DISTRIBUTIONS
- ------------------------
Dividends from net
investment income...... (1.58) (1.34) (1.42) (1.39) (1.46)
Distributions from net
realized gains......... -0- -0- -0- (4.96) -0-
Distributions in excess
of net realized gains.. -0- -0- -0- (.09) -0-
Tax return of capital
distribution........... -0- -0- -0- (.23) -0-
-------- -------- -------- ------- --------
Total dividends and
distributions.......... (1.58) (1.34) (1.42) (6.67) (1.46)
-------- -------- -------- ------- --------
Net asset value, end of
period................. $ 16.03 $ 15.50 $ 11.88 $ 11.08 $ 22.09
======== ======== ======== ======= ========
Market value, end of
period................. $ 15.875 $ 13.625 $ 11.75 $ 13.00 $ 20.375
======== ======== ======== ======= ========
TOTAL RETURN
- ------------------------
Total investment return
based on: (d)
Market value.......... 28.74% 28.49% 2.78% (7.52)% 59.14%
Net asset value....... 14.24% 44.57% 21.92% (27.29)% 72.53%
RATIOS/SUPPLEMENTAL DATA
- ------------------------
Net assets, end of
period (000's omitted). $138,709 $134,140 $102,757 $93,528 $164,622
Ratio of expenses to
average net assets..... 1.43% 1.70% 1.55% 1.43% 1.44%(e)
Ratio of net investment
income to average net
assets................. 9.50% 10.84% 14.12% 9.08% 9.79%(e)
Portfolio turnover rate. 281% 352% 441% 395% 417%
</TABLE>
- --------------------------------------------------------------------------------
(a) Commencement of operations.
(b) Net of offering costs of $.13.
(c) Based on average shares outstanding.
(d) Total investment return is calculated assuming a purchase of common stock
on the opening of the first day and a sale on the closing of the last day
of the period reported. Dividends and distributions, if any, are assumed,
for purposes of this calculation, to be reinvested at prices obtained under
the Fund's Dividend Reinvestment Plan. Generally, total investment return
based on net asset value will be higher than total investment return based
on market value in periods where there is an increase in the discount or a
decrease in the premium of the market value to the net asset value from the
beginning to the end of such periods. Conversely, total investment return
based on net asset value will be lower than total investment return based
on market value in periods where there is a decrease in the discount or an
increase in the premium of the market value to the net asset value from the
beginning to the end of such periods. Total investment return calculated
for a period of less than one year is not annualized.
(e) Annualized.
A-9
<PAGE>
REPORT OF ERNST & YOUNG LLP
INDEPENDENT AUDITORS ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
- -------------------------------------------------------------------------------
TO THE SHAREHOLDERS AND BOARD OF DIRECTORS ALLIANCE WORLD DOLLAR GOVERNMENT
FUND, INC.
We have audited the accompanying statement of assets and liabilities of Alli-
ance World Dollar Government Fund, Inc., including the portfolio of invest-
ments, as of October 31, 1997, and the related statement of operations for the
year then ended, the statement of changes in net assets for each of the two
years in the period then ended, and the financial highlights for each of the
periods indicated therein. These financial statements and financial highlights
are the responsibility of the Fund's management. Our responsibility is to ex-
press an opinion on these financial statements and financial highlights based
on our audits.
We conducted our audits in accordance with generally accepted auditing stan-
dards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of Oc-
tober 31, 1997, by correspondence with the custodian and brokers. An audit
also includes assessing the accounting principles used and significant esti-
mates made by management, as well as evaluating the overall financial state-
ment presentation. We believe that our audits provide a reasonable basis for
our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of Al-
liance World Dollar Government Fund, Inc. at October 31, 1997, the results of
its operations for the year then ended, the changes in
its net assets for each of the two years in the period then ended, and the fi-
nancial highlights for each of the indicated periods, in conformity with gen-
erally accepted accounting principles.
/s/ Ernst & Young LLP
New York, New York
November 21, 1997
A-10
<PAGE>
PORTFOLIO OF INVESTMENTS
OCTOBER 31, 1996 ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
(000) U.S. $ VALUE
- --------------------------------------------------------------------------------
<S> <C> <C>
SOVEREIGN DEBT OBLIGATIONS-105.8%
COLLATERALIZED BRADY BOND*-73.0%
ARGENTINA-10.8%
Republic of Argentina
Discount Bonds FRN
6.4375%, 3/31/23........................................ $10,250 $ 7,392,812
Euro Par Bonds
5.25%, 3/31/23(a)....................................... 12,000 7,113,750
------------
Total Argentinean Securities............................. 14,506,562
------------
BRAZIL-12.4%
Republic of Brazil
Discount Bonds FRN
Series Z-L
6.50%, 4/15/24.......................................... 10,600 7,771,125
Par Bonds
Series Z-L
5.00%, 4/15/24(a)....................................... 14,750 8,822,344
------------
Total Brazilian Securities............................... 16,593,469
------------
BULGARIA-7.2%
Republic of Bulgaria
Discount Bonds FRN
6.6875%, 7/28/24........................................ 19,000 9,612,812
------------
ECUADOR-5.4%
Republic of Ecuador
Discount Bonds FRN
6.50%, 2/28/25.......................................... 11,000 7,290,938
------------
MEXICO-17.7%
United Mexican States
Euro Par Bonds
6.25%, 12/31/19(b)
Series A................................................ 18,300 12,855,750
Series B................................................ 15,500 10,888,750
------------
Total Mexican Securities................................. 23,744,500
------------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
(000) U.S. $ VALUE
<S> <C> <C>
NIGERIA-4.7%
Central Bank of Nigeria
Par Bonds
6.25%, 11/15/20(c)....................................... $10,000 $ 6,256,250
------------
VENEZUELA-14.8%
Republic of Venezuela
Par Bonds
6.75%, 3/31/20(d)
Series W-A............................................... 21,500 15,265,000
Series W-B............................................... 6,500 4,615,000
------------
Total Venezuelan Securities............................... 19,880,000
------------
Total Collateralized
Brady Bonds
(cost $87,582,573)....................................... 97,884,531
------------
NON-COLLATERALIZED BRADY BONDS-18.0%
PANAMA-9.8%
Republic of Panama IRB
3.50%, 7/17/14(a)(e)..................................... 20,000 13,150,000
------------
PERU-6.2%
Republic of Peru FLIRB
3.25%, 3/15/16(a)(e)(f).................................. 15,000 8,287,500
------------
RUSSIA-2.0%
Russia Principal Loans FRN
12/29/20(e)(f)........................................... 5,000 2,678,125
------------
Total Non-Collateralized
Brady Bonds
(cost $19,728,932)....................................... 24,115,625
------------
LOAN PARTICIPATIONS & ASSIGNMENTS-8.5%
ALGERIA-1.4%
Algeria Refinancing Trust FRN
Loan Assignment Tranche B
7.1875%, 9/05/05......................................... 3,000 1,980,000
------------
</TABLE>
A-11
<PAGE>
PORTFOLIO OF INVESTMENTS (CONTINUED) ALLIANCE WORLD DOLLAR GOVERNMENT FUND,
INC.
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
(000) U.S. $ VALUE
- --------------------------------------------------------------------------------
<S> <C> <C>
MOROCCO-7.1%
Kingdom of Morocco
Loan Participation FRN
6.4375%, 1/01/09........................................ $12,000 $ 9,525,000
-----------
Total Loan Participations & Assignments
(cost $7,889,035)....................................... 11,505,000
-----------
SOVEREIGN DEBT- RELATED-6.3%
Morgan Guaranty Trust Co.
Indexed Note
Linked Russian US$ Vneshekonombank
Loan Assignment 14.00%, 2/28/97(g) (cost $7,260,000).... 7,260 8,462,982
-----------
</TABLE>
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT
(000) U.S. $ VALUE
<S> <C> <C>
Total Sovereign Debt Obligations
(cost $122,460,531)..................................... $141,968,138
------------
U.S. GOVERNMENT OBLIGATIONS-32.5%
U.S. Treasury Strip
Zero coupon, 2/15/03 (cost $43,074,478)................. $64,000 43,594,873
------------
TOTAL INVESTMENTS-138.3%
(cost $165,535,009)..................................... 185,563,011
Other assets less liabilities-(38.3%).................... (51,422,542)
------------
NET ASSETS-100%.......................................... $134,140,469
============
</TABLE>
- -------------------------------------------------------------------------------
* Sovereign debt obligations issued as part of debt restructurings that are
collateralized in full as to principal due at maturity by U.S. Treasury zero
coupon obligations which have the same maturity as the Brady Bond.
(a) Coupon will increase periodically based upon a predetermined schedule.
Stated interest rate in effect at October 31, 1996.
(b) Security trades with value recovery rights expiring June 30, 2003.
(c) Security trades with oil warrants expiring November 15, 2020.
(d) Security trades with oil warrants expiring April 15, 2020.
(e) Securities are exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At October 31,
1996, these securities amounted to $24,115,625 or 18.0% of net assets.
(f) When issued.
(g) Principal amount represents par value at purchase date. The redemption
value of this security is linked to the change in the bid price of the
referenced emerging market debt.
Glossary of Terms:
FLIRB Front loaded interest reduction bonds.
FRNFloating rate note. Coupon will fluctuate based upon an interest rate
index. Stated interest rate in effect at October 31, 1996.
IRBInterest reduction bonds.
See notes to financial statements.
A-12
<PAGE>
STATEMENT OF ASSETS AND LIABILITIES
OCTOBER 31, 1996 ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
ASSETS
Investments in securities, at value (cost $165,535,009).......... $185,563,011
Receivable for investment securities sold........................ 42,932,000
Interest receivable.............................................. 2,453,252
Deferred organization expenses and other assets.................. 22,020
------------
Total assets..................................................... 230,970,283
------------
LIABILITIES
Due to custodian................................................. 745,420
Payable for investment securities purchased...................... 95,260,280
Unrealized depreciation on interest rate swap contract........... 356,604
Advisory fee payable............................................. 111,235
Administrative fee payable....................................... 16,685
Accrued expenses and other liabilities........................... 339,590
------------
Total liabilities................................................ 96,829,814
------------
NET ASSETS........................................................ $134,140,469
============
COMPOSITION OF NET ASSETS
Capital stock, at par............................................ $ 86,527
Additional paid-in capital....................................... 119,218,745
Undistributed net investment income.............................. 2,492,634
Accumulated net realized loss on investments..................... (7,328,835)
Net unrealized appreciation of investments and other assets...... 19,671,398
------------
$134,140,469
============
NET ASSET VALUE PER SHARE (based on 8,652,707 shares outstanding). $15.50
======
</TABLE>
- --------------------------------------------------------------------------------
See notes to financial statements.
A-13
<PAGE>
STATEMENT OF OPERATIONS
YEAR ENDED OCTOBER 31, 1996 ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
- --------------------------------------------------------------------------------
<TABLE>
<S> <C> <C>
INVESTMENT INCOME
Interest............................................... $14,602,824
EXPENSES
Advisory fee........................................... $1,166,831
Audit and legal........................................ 189,062
Administrative fee..................................... 175,024
Custodian.............................................. 111,803
Printing............................................... 103,336
Transfer agency........................................ 95,866
Directors' fees........................................ 41,297
Registration........................................... 37,112
Amortization of organization expenses.................. 17,033
Miscellaneous.......................................... 47,233
----------
Total expenses......................................... 1,984,597
-----------
Net investment income.................................. 12,618,227
-----------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS
Net realized gain on investment transactions........... 13,908,106
Net change in unrealized appreciation of investments
and other assets...................................... 16,452,008
-----------
Net gain on investments................................ 30,360,114
-----------
NET INCREASE IN NET ASSETS FROM OPERATIONS.............. $42,978,341
===========
</TABLE>
- --------------------------------------------------------------------------------
See notes to financial statements.
A-14
<PAGE>
STATEMENT OF CHANGES
IN NET ASSETS ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED YEAR ENDED
OCTOBER 31, OCTOBER 31,
1996 1995
------------ ------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS
Net investment income............................. $ 12,618,227 $ 12,920,751
Net realized gain (loss) on investment
transactions..................................... 13,908,106 (10,415,111)
Net change in unrealized appreciation of
investments and other assets..................... 16,452,008 16,574,731
------------ ------------
Net increase in net assets from operations........ 42,978,341 19,080,371
DIVIDENDS TO SHAREHOLDERS FROM:
Net investment income............................. (11,594,630) (12,156,022)
COMMON STOCK TRANSACTIONS
Reinvestment of dividends resulting in issuance of
common stock..................................... -0- 2,304,564
------------ ------------
Total increase.................................... 31,383,711 9,228,913
NET ASSETS
Beginning of year................................. 102,756,758 93,527,845
------------ ------------
End of year (including undistributed net
investment income of $2,492,634 and $764,729 at
October 31, 1996 and October 31, 1995,
respectively).................................... $134,140,469 $102,756,758
============ ============
</TABLE>
- --------------------------------------------------------------------------------
See notes to financial statements.
A-15
<PAGE>
NOTES TO FINANCIAL STATEMENTS
OCTOBER 31, 1996 ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
- -------------------------------------------------------------------------------
NOTE A: SIGNIFICANT ACCOUNTING POLICIES
Alliance World Dollar Government Fund, Inc. (the "Fund") was incorporated un-
der the laws of the State of Maryland on August 20, 1992 and is registered un-
der the Investment Company Act of 1940, as a non-diversified, closed-end man-
agement investment company. The following is a summary of significant account-
ing policies followed by the Fund.
1. SECURITY VALUATION
Portfolio securities traded on a national securities exchange are valued at
the last sale price on such exchange on the day of valuation or, if there was
no sale on such day, the last bid price quoted on such day. Listed securities
not traded and securities traded in the over-the-counter market, including
listed debt securities whose primary market is believed to be over-the-count-
er, are valued at the mean between the most recently quoted bid and asked
price provided by the principal market makers. Publicly traded Sovereign Debt
Obligations are typically traded internationally on the over-the-counter mar-
ket. Because of the nature of the markets for Sovereign Debt Obligations, quo-
tations from several sources will be obtained so that the Fund's portfolio in-
vestments will not generally be priced by a single source. Readily marketable
Sovereign Debt Obligations may be valued on the basis of prices provided by a
pricing service when such prices are believed by the Adviser to reflect the
fair value of such securities. Securities for which market quotations are not
readily available and restricted securities which are subject to limitations
as to their resale are valued in good faith, at fair value, using methods de-
termined by the Board of Directors. Securities which mature in 60 days or less
are valued at amortized cost, which approximates fair value, unless this
method does not represent fair value.
2. ORGANIZATION EXPENSES
Organization expenses of approximately $90,000 have been deferred and are be-
ing amortized on a straight-line basis through November, 1997.
3. TAXES
It is the Fund's policy to meet the requirements of the Internal Revenue Code
applicable to regulated investment companies and to distribute all of its in-
vestment company taxable income and net realized gains, if applicable, to
shareholders. Therefore, no provisions for federal income or excise taxes are
required.
4. INVESTMENT INCOME AND INVESTMENT TRANSACTIONS
Interest income is accrued daily. Investment transactions are accounted for on
the date securities are purchased or sold. Investment gains and losses are de-
termined on the identified cost basis. The Fund accretes discounts as adjust-
ments to interest income.
5. DIVIDENDS AND DISTRIBUTIONS
Dividends and distributions to shareholders are recorded on the ex-dividend
date and are determined in accordance with income tax regulations.
6. RECLASSIFICATION OF COMPONENTS OF NET ASSETS
During the year, the Fund reclassified certain components of net assets. The
reclassification resulted in a net increase to undistributed net investment
income and a corresponding increase to accumulated net realized loss on in-
vestments of $704,308. This reclassification was the result of permanent book
to tax differences in the classification of short term capital gains as ordi-
nary income. Net assets were not affected by the reclassification.
- -------------------------------------------------------------------------------
NOTE B: ADVISORY AND ADMINISTRATIVE FEES
Under the terms of an Investment Advisory Agreement, the Fund pays Alliance
Capital Management L.P., (the "Adviser") a monthly fee equal to the annualized
rate of 1% of the Fund's average weekly net assets.
Under the terms of an Administrative Agreement, the Fund pays Alliance Capital
Management L.P., (the
"Administrator") a monthly fee equal to the annualized rate of .15 of 1% of
the Fund's average weekly net assets. The Administrator provides administra-
tive functions to the Fund as well as other clerical services. The Administra-
tor also prepares financial and regulatory reports for the Fund.
A-16
<PAGE>
ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
- -------------------------------------------------------------------------------
On November 28, 1995, the Fund entered into a Shareholder Inquiry Agency
Agreement with Alliance Fund Services, Inc., ("AFS"), an affiliate of the In-
vestment Adviser whereby the Fund reimburses AFS for costs relating to servic-
ing phone inquiries for the Fund. The Fund reimbursed AFS $3,995 during the
year ended October 31, 1996, relating to shareholder servicing costs.
- -------------------------------------------------------------------------------
NOTE C: INVESTMENT TRANSACTIONS
Purchases and sales of investment securities (excluding short-term investments
and U.S. Government securities) aggregated $105,390,078 and $137,552,931, re-
spectively, for the year ended October 31, 1996.
At October 31, 1996, the cost of investments for federal income tax purposes was
$165,684,739. Accordingly, gross unrealized appreciation of investments was
$20,058,005 and gross unrealized depreciation of investments was $179,733
resulting in net unrealized appreciation of $19,878,272 (excluding swap
contracts). At October 31, 1996, the Fund had a capital loss carry-forward of
$7,179,105 which ex-pires in the year 2003.
- -------------------------------------------------------------------------------
NOTE D: INTEREST RATE SWAP AGREEMENT
The Fund enters into swaps on sovereign debt obligations to protect itself
from interest rate fluctuations on the underlying floating rate debt instru-
ments and for investment purposes. A swap is an agreement that obligates two
parties to exchange a series of cash flows at specified intervals based upon
or calculated by reference to changes in specified prices or rates for a spec-
ified amount of an underlying asset. The payment flows are usually netted
against each other, with the difference being paid by one party to the other.
Risks may arise as a result of the failure of another party to the swap con-
tract to comply with the terms of the swap contract. The loss incurred by the
failure of a counterparty is generally limited to the net interest payment to
be received by the Fund, and/or the termination
value at the end of the contract. Therefore, the Fund considers the creditwor-
thiness of each counterparty to a swap contract in evaluating potential credit
risk. Additionally, risks may arise from unanticipated movements in interest
rates or in the value of the underlying securities.
The Fund records a net receivable or payable on a daily basis for the net in-
terest income or expense expected to be received or paid in the interest peri-
od. Net interest received or paid on these contracts is recorded as interest
income (or as an offset to interest income). Fluctuations in the value of swap
contracts are recorded for financial statement purposes as unrealized appreci-
ation or depreciation on swap contracts.
At October 31, 1996, the Fund had an outstanding interest rate swap contract
with the following terms:
<TABLE>
<CAPTION>
RATE TYPE
-----------------
PAYMENTS
PAYMENTS RECEIVED
SWAP NATIONAL TERMINATION MADE BY BY THE UNREALIZED
COUNTERPARTY AMOUNT DATE THE FUND FUND DEPRECIATION
------------ -------------- ----------- -------- -------- ------------
<S> <C> <C> <C> <C> <C>
Morgan Guaranty US$ 12,000,000 1/01/09 LIBOR+ 6.8526% $356,604
</TABLE>
+ LIBOR (London Interbank Offered Rate).
- -------------------------------------------------------------------------------
NOTE E: CAPITAL STOCK
There are 100,000,000 shares of $0.01 par value Common Stock authorized.
Of the 8,652,707 shares outstanding at October 31, 1996, the Adviser owned
7,200 shares. During the year ended October 31, 1996, the Fund did not issue
shares
A-17
<PAGE>
NOTES TO FINANCIAL STATEMENTS
(CONTINUED) ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
- -------------------------------------------------------------------------------
in connection with the dividend reinvestment plan. During the year ended Octo-
ber 31, 1995 the Fund issued 212,897 shares in connection with the Fund's div-
idend reinvestment plan.
During the year ended October 31, 1996, the Fund incurred legal, printing and
auditing fees associated with a proposed rights offering of approximately
$216,000. The proposed rights offering was cancelled prior to issuance.
- -------------------------------------------------------------------------------
NOTE F: CONCENTRATION OF RISK
Investing in securities of foreign governments involves special risks which
include revaluation of currencies and the possibility of future adverse polit-
ical and economic developments. Moreover, securities of many foreign govern-
ments and their markets may be less liquid and their prices more volatile than
those of the United States government. The Fund invests in the sovereign debt
obligations of countries that are considered emerging market countries at the
time of purchase. Therefore, the Fund is susceptible to governmental factors
and economic and debt restructuring developments adversely affecting the econ-
omies of these emerging market countries. In addition, these debt obligations
may be less liquid and subject to greater volatility than debt obligations of
more developed countries.
A-18
<PAGE>
FINANCIAL HIGHLIGHTS ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
- --------------------------------------------------------------------------------
SELECTED DATA FOR A SHARE OF COMMON STOCK OUTSTANDING THROUGHOUT EACH PERIOD
<TABLE>
<CAPTION>
YEAR ENDED OCTOBER 31, NOVEMBER 2, 1992(A)
----------------------------- TO
1996 1995 1994 OCTOBER 31, 1993
-------- -------- ------- -------------------
<S> <C> <C> <C> <C>
Net asset value, beginning
of period................. $ 11.88 $ 11.08 $ 22.09 $ 13.82(b)
-------- -------- ------- --------
INCOME FROM INVESTMENT OP-
ERATIONS
- ---------------------------
Net investment income...... 1.46 1.51(c) 1.32 1.54
Net realized and unrealized
(loss) on investments..... 3.50 .71 (5.66) 8.19
-------- -------- ------- --------
Net increase (decrease) in
net asset value from
operations................ 4.96 2.22 (4.34) 9.73
-------- -------- ------- --------
LESS: DIVIDENDS AND DISTRI-
BUTIONS
- ---------------------------
Dividends from net invest-
ment income............... (1.34) (1.42) (1.39) (1.46)
Distributions from net re-
alized gains.............. -0- -0- (4.96) -0-
Distributions in excess of
net realized gains........ -0- -0- (.09) -0-
Tax return of capital dis-
tribution................. -0- -0- (.23) -0-
-------- -------- ------- --------
Total dividends and distri-
butions................... (1.34) (1.42) (6.67) (1.46)
-------- -------- ------- --------
Net asset value, end of pe-
riod...................... $ 15.50 $ 11.88 $ 11.08 $ 22.09
======== ======== ======= ========
Market value, end of peri-
od........................ $ 13.625 $ 11.75 $ 13.00 $ 20.375
======== ======== ======= ========
TOTAL RETURN
- ---------------------------
Total investment return
based on: (d)
Market value............. 28.49% 2.78% (7.52)% 59.14%
Net asset value.......... 44.57% 21.92% (27.29)% 72.53%
RATIOS/SUPPLEMENTAL DATA
- ---------------------------
Net assets, end of period
(000's omitted)........... $134,140 $102,757 $93,528 $164,622
Ratio of expenses to aver-
age net assets............ 1.70% 1.55% 1.43% 1.44%(e)
Ratio of net investment in-
come to average net as-
sets...................... 10.84% 14.12% 9.08% 9.79%(c)
Portfolio turnover rate.... 352% 441% 395% 417%
</TABLE>
- --------------------------------------------------------------------------------
(a) Commencement of operations.
(b) Net of offering costs of $.13.
(c) Based on average shares outstanding.
(d) Total investment return is calculated assuming a purchase of common stock
on the opening of the first day and a sale on the closing of the last day
of the period reported. Dividends and distributions, if any, are assumed,
for purposes of this calculation, to be reinvested at prices obtained under
the Fund's Dividend Reinvestment Plan. Generally, total investment return
based on net asset value will be higher than total investment return based
on market value in periods where there is an increase in the discount or a
decrease in the premium of the market value to the net asset value from the
beginning to the end of such periods. Conversely, total investment return
based on net asset value will be lower than total investment return based
on market value in periods where there is a decrease in the discount or an
increase in the premium of the market value to the net asset value from the
beginning to the end of such periods. Total investment return calculated
for a period of less than one year is not annualized.
(e) Annualized.
A-19
<PAGE>
REPORT OF ERNST & YOUNG LLP
INDEPENDENT AUDITORS ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
- -------------------------------------------------------------------------------
TO THE SHAREHOLDERS AND BOARD OF DIRECTORS ALLIANCE WORLD DOLLAR GOVERNMENT
FUND, INC.
We have audited the accompanying statement of assets and liabilities of Alli-
ance World Dollar Government Fund, Inc., including the portfolio of invest-
ments, as of October 31, 1996, and the related statement of operations for the
year then ended, the statement of changes in net assets for each of the two
years in the period then ended, and the financial highlights for each of the
periods indicated therein. These financial statements and financial highlights
are the responsibility of the Fund's management. Our responsibility is to ex-
press an opinion on these financial statements and financial highlights based
on our audits.
We conducted our audits in accordance with generally accepted auditing stan-
dards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and financial
highlights are free of material misstatement. An audit includes examining, on
a test basis, evidence supporting the amounts and disclosures in the financial
statements. Our procedures included confirmation of securities owned as of Oc-
tober 31, 1996, by correspondence with the custodian and brokers. An audit
also
includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement pre-
sentation. We believe that our audits provide a reasonable basis for our opin-
ion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of Al-
liance World Dollar Government Fund, Inc. at October 31, 1996, the results of
its operations for the year then ended, the changes in its net assets for each
of the two years in the period then ended, and the financial highlights for
each of the indicated periods, in conformity with generally accepted account-
ing principles.
/s/ Ernst & Young LLP
New York, New York
December 3, 1996
A-20
<PAGE>
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Financial Highlights"
and to the use of our reports dated November 21, 1997 and December 3, 1996
included in this Issuer Tender Offer Statement (Schedule 13E-4) of Alliance
World Dollar Government Fund, Inc.
ERNST & YOUNG LLP
New York, New York
December 9, 1997
<PAGE>
EXHIBIT (a)(2)(i)
LETTER OF TRANSMITTAL
TO ACCOMPANY SHARES OF COMMON STOCK, $0.01 PAR VALUE
OF
ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
TENDERED PURSUANT TO THE OFFER TO PURCHASE DATED DECEMBER 10, 1997
THE OFFER EXPIRES AT 12:00 MIDNIGHT EASTERN TIME
ON JANUARY 8, 1998, UNLESS THE OFFER IS EXTENDED
DEPOSITARY TELEPHONE NUMBER: (800) 331-1710
DEPOSITARY ADDRESSES:
By Registered, Certified
or Express Mail or
Overnight Courier:
By First Class Mail: By Hand:
Boston EquiServe, L.P. Boston EquiServe, L.P. Securities Transfer and
Corporate Reorganization Corporate Reorganization Reporting Services, Inc.
P.O. Box 9061 70 Campanelli Drive Boston EquiServe, L.P.
Boston, MA 02205-8686 Braintree, MA 02184 Corporate Reorganization
1 Exchange Plaza
55 Broadway, Third Floor
New York, NY 10006
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE DOES NOT CONSTITUTE A VALID DELIVERY. THE INSTRUCTIONS ACCOMPANYING THIS
LETTER OF TRANSMITTAL SHOULD BE READ CAREFULLY BEFORE THIS LETTER OF
TRANSMITTAL IS COMPLETED.
This Letter of Transmittal is to be used (a) if you desire to effect the
tender transaction yourself, (b) if you intend to request your broker, dealer,
commercial bank, trust company or other nominee to effect the transaction for
you and the Shares are not registered in the name of such broker, dealer,
commercial bank, trust company or other nominee, and (c) by a broker, dealer,
commercial bank, trust company or other nominee effecting the transaction as a
registered owner or on behalf of a registered owner. To accept the Offer in
accordance with its terms, a Letter of Transmittal (or a copy or facsimile
thereof) properly completed and bearing original signature(s) and the original
of any required signature guarantee(s), any certificates representing Shares
tendered, any other documents required by this Letter of Transmittal and a
check payable to BankBoston, N.A. (the "Depositary") in the amount of $25.00
(the "Processing Fee") must be mailed or delivered to the Depositary at an
appropriate address set forth above and must be received by the Depositary
prior to 12:00 Midnight Eastern Time on January 8, 1998, or such later time
and date to which the Offer is extended, unless the tendering party has
satisfied the conditions for guaranteed delivery described in Section 4(e) of
the Offer to Purchase. Delivery of documents to a book-entry transfer facility
does not constitute delivery to the Depositary.
<PAGE>
- -------------------------------------------------------------------------------
DESCRIPTION OF SHARES TENDERED
(SEE INSTRUCTIONS 3 AND 4)
- -------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED SHARES TENDERED*
OWNER(S) (PLEASE FILL IN, IF BLANK,
THE NAME(S) IN WHICH SHARES ARE
REGISTERED) (ATTACH ADDITIONAL SIGNED
LIST, IF NECESSARY)
- -------------------------------------------------------------------------------
TOTAL NUMBER OF
SHARE CERTIFICATE SHARES NUMBER(S)**
REPRESENTED
BY CERTIFICATE(S)*
TOTAL SHARES.....
- -------------------------------------------------------------------------------
* If the Shares tendered hereby are in certificate form, the certificates
representing such Shares MUST be returned together with this Letter of
Transmittal.
** Need not be completed for Book-Entry Shares.
- -------------------------------------------------------------------------------
THE UNDERSIGNED ALSO TENDERS ALL UNCERTIFICATED SHARES HELD IN THE NAME(S) OF
THE UNDERSIGNED BY THE FUND'S TRANSFER AGENT PURSUANT TO THE FUND'S DIVIDEND
REINVESTMENT PLAN, IF ANY. CHECK THIS BOX [_] IF THERE ARE ANY SUCH SHARES.
[_]THIS BOX SHOULD BE CHECKED IF, IN ADDITION TO SHARES TENDERED HEREBY,
SHARES ARE ALSO CONSTRUCTIVELY OWNED BY THE UNDERSIGNED AS DETERMINED UNDER
SECTION 318 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED.
A SEPARATE LETTER OF TRANSMITTAL MUST BE SUBMITTED BY EACH REGISTERED OWNER OF
SHARES WHICH ARE CONSIDERED TO BE CONSTRUCTIVELY OWNED BY THE UNDERSIGNED.
THE BOXES BELOW ARE TO BE CHECKED BY ELIGIBLE INSTITUTIONS ONLY
[_]CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
MADE TO THE ACCOUNT MAINTAINED BY THE DEPOSITARY WITH THE DEPOSITORY TRUST
COMPANY ("DTC") AND COMPLETE THE FOLLOWING:
NAME OF TENDERING INSTITUTION: _____________________________________________
DTC PARTICIPANT NUMBER: ____________________________________________________
[_]CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE
FOLLOWING:
NAME(S) OF REGISTERED HOLDER(S): ___________________________________________
WINDOW TICKET NUMBER (IF ANY): _____________________________________________
DATE OF EXECUTION OF NOTICE OF GUARANTEED DELIVERY: ________________________
NAME OF ELIGIBLE INSTITUTION WHICH GUARANTEED DELIVERY: ____________________
DTC PARTICIPANT NUMBER (IF DELIVERED BY BOOK-ENTRY TRANSFER): ______________
NOTE: SIGNATURE(S) MUST BE PROVIDED BELOW
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
<PAGE>
Ladies and Gentlemen:
The person(s) signing this Letter of Transmittal (the "Signor") hereby
tender(s) to Alliance World Dollar Government Fund, Inc., a non-diversified,
closed-end management investment company incorporated in Maryland (the
"Fund"), the above-described shares of common stock, par value $0.01 per share
(the "Shares"), of the Fund, for purchase by the Fund at a price (the
"Purchase Price") equal to the net asset value ("NAV") per Share determined as
of the close of the regular trading session of the New York Stock Exchange on
January 8, 1998 (or, if the Offer as defined below is extended, on the
Expiration Date as defined in the Offer to Purchase) in cash, under the terms
and subject to the conditions set forth in the Offer to Purchase dated
December 10, 1997, receipt of which is hereby acknowledged, and in this Letter
of Transmittal (which Offer to Purchase and Letter of Transmittal together
constitute the "Offer").
Subject to, and effective upon, acceptance for payment of, or payment for,
Shares tendered herewith in accordance with the terms and subject to the
conditions of the Offer (including, if the Offer is extended or amended, the
terms or conditions of any such extension or amendment), the Signor hereby
sells, assigns and transfers to, or upon the order of, the Fund all right,
title and interest in and to all of the Shares that are being tendered hereby
that are purchased pursuant to the Offer and hereby irrevocably constitutes
and appoints BankBoston, N.A. (the "Depositary") as attorney-in-fact of the
Signor with respect to such Shares, with full power of substitution (such
power of attorney being deemed to be an irrevocable power coupled with an
interest), to (a) present certificate(s) for such Shares, if any, for
cancellation and transfer on the Fund's books and (b) receive all benefits and
otherwise exercise all rights of beneficial ownership of such Shares, subject
to the next paragraph, all in accordance with the terms and subject to the
conditions set forth in the Offer.
The Signor hereby represents and warrants that (a) the Signor, if a broker,
dealer, commercial bank, trust company or other nominee, has obtained the
tendering Stockholder's instructions to tender pursuant to the terms and
conditions of this Offer in accordance with the letter from the Fund to
brokers, dealers, commercial banks, trust companies and other nominees; (b)
when and to the extent the Fund accepts the Shares for purchase, the Fund will
acquire good, marketable and unencumbered title thereto, free and clear of all
security interests, liens, restrictions, charges, encumbrances, conditional
sales agreements or other obligations relating to their sale or transfer, and
not subject to any adverse claim; (c) on request, the Signor will execute and
deliver any additional documents that the Depositary or the Fund deems
necessary or desirable to complete the assignment, transfer and purchase of
the Shares tendered hereby; and (d) the Signor has read and agrees to all of
the terms and conditions of the Offer.
The name(s) and address(es) of the registered owner(s) should be printed as
on the registration of the Shares. If the Shares tendered hereby are in
certificate form, the certificate(s) representing such Shares must be returned
together with this Letter of Transmittal.
The Signor recognizes that, under certain circumstances as set forth in the
Offer to Purchase, the Fund may amend, extend or terminate the Offer or may
not be required to purchase any of the Shares tendered hereby. In any such
event, the Signor understands that certificate(s) for the Shares not
purchased, if any, will be returned to the Signor at its registered address
unless otherwise indicated under the Special Delivery Instructions below. The
Signor recognizes that the Fund has no obligation, pursuant to the Special
Payment Instructions set forth below, to transfer any Shares from the name of
the registered owner thereof if the Fund purchases none of such Shares.
The Signor understands that acceptance of Shares by the Fund for payment
will constitute a binding agreement between the Signor and the Fund upon the
terms and subject to the conditions of the Offer.
The check for the Purchase Price of the tendered Shares purchased will be
issued to the order of the Signor and mailed to the address indicated, unless
otherwise indicated below in the box titled Special Payment Instructions or
the box titled Special Delivery Instructions. The Fund will not pay interest
on the Purchase Price under any circumstances.
All authority herein conferred or agreed to be conferred shall survive the
death or incapacity of the Signor and all obligations of the Signor hereunder
shall be binding upon the heirs, personal representatives, successors and
assigns of the Signor. Except as stated in the Offer, this tender is
irrevocable.
Unless otherwise indicated herein under "Special Payment Instructions,"
please issue the check for the Purchase Price and/or return any Share
certificates not accepted for payment in the name(s) of the registered
holder(s) appearing above under "Description of Shares Tendered." Similarly,
unless otherwise indicated under "Special Delivery Instructions," please mail
the check for the Purchase Price for any Shares purchased and/or return any
Share certificates not accepted for payment (and accompanying documents, as
appropriate) to the address(es) of the registered holder(s) appearing under
"Description of Shares Tendered." In the event that both the Special Payment
Instructions and the Special Delivery Instructions are completed, please issue
the check for the Purchase Price and/or return any Share certificates not
accepted for payment in the name of, and deliver such check and/or return any
such Share certificates to, the person(s) so indicated. The undersigned
recognizes that the Fund has no obligation pursuant to the Special Payment
Instructions to transfer any Shares from the name of the registered holder
thereof if the Fund does not accept for payment any of the Shares tendered
hereby.
<PAGE>
SPECIAL PAYMENT INSTRUCTIONS (SEE SPECIAL DELIVERY INSTRUCTIONS
INSTRUCTIONS 1, 5, 6 AND 7) (SEE INSTRUCTIONS 1, 5, 6 AND 7)
To be completed ONLY if any cer- To be completed ONLY if any cer-
tificate for Shares not pur- tificate for Shares not pur-
chased, and/or a check for the chased, and/or a check for the
purchase price of Shares accepted purchase price of Shares accepted
for payment, is to be issued in for payment and issued in the
the name of someone other than name of the registered owner(s),
the undersigned. is to be sent to someone other
than the registered owner(s) or
to the registered owner(s) at an
address other than that shown
above.
Issue:[_] Check to:
[_] Certificate(s) to:
Name(s) __________________________
(PLEASE PRINT) Mail:[_] Check to:
Address(es) ______________________ [_] Certificate(s) to:
__________________________________ Name(s)___________________________
__________________________________ (PLEASE PRINT)
(INCLUDE ZIP CODE) Address(es) ______________________
__________________________________ __________________________________
(TAX IDENTIFICATION OR SOCIAL __________________________________
SECURITY NUMBER(S)) (INCLUDE ZIP CODE)
__________________________________
(TAX IDENTIFICATION OR SOCIAL
SECURITY NUMBER(S))
STOCKHOLDER(S) SIGN HERE
(SEE INSTRUCTIONS 1 AND 5)
(PLEASE SEE SUBSTITUTE FORM W-9)
(PLEASE PRINT EXCEPT FOR SIGNATURE)
Must be signed by registered owner(s) exactly as Shares are registered.
If signature is by an attorney-in-fact, executor, administrator, trustee,
guardian, officer of a corporation or another acting in a fiduciary or
representative capacity, please set forth the full title. See Instruction
5. Signature guarantees are required in certain circumstances. See
Instruction 1. By signing this Letter of Transmittal, you represent that
you have read the entire Letter of Transmittal.
----------------------------------------------------------------------------
----------------------------------------------------------------------------
(SIGNATURE(S) EXACTLY AS SHARES ARE REGISTERED)
Dated , 199
Name(s) ____________________________________________________________________
----------------------------------------------------------------------------
(PLEASE PRINT NAME(S) OF OWNER(S) EXACTLY AS SHARES ARE REGISTERED)
----------------------------------------------------------------------------
(TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER(S))
Daytime Telephone Number, including Area Code ______________________________
<PAGE>
GUARANTEE OF SIGNATURE(S)
(SEE INSTRUCTIONS 1 AND 5)
(PLEASE PRINT EXCEPT FOR SIGNATURE)
Authorized Signature _______________________________________________________
Name _______________________________________________________________________
Title ______________________________________________________________________
Name of Firm _______________________________________________________________
Address ____________________________________________________________________
----------------------------------------------------------------------------
(INCLUDE ZIP CODE)
----------------------------------------------------------------------------
Telephone Number, including Area Code ______________________________________
Dated , 199
<PAGE>
INSTRUCTIONS
Forming Part of the Terms and Conditions of the Offer
1. GUARANTEE OF SIGNATURES. No signature guarantee is required on this
Letter of Transmittal if (a) this Letter of Transmittal is signed by the
registered holder(s) of Shares tendered hereby (including, for purposes of
this document, any participant in the book-entry transfer facility of The
Depository Trust Company ("DTC") whose name appears on DTC's security position
listing as the owner of Shares), unless such holder(s) has completed either
the box entitled "Special Payment Instructions" or the box entitled "Special
Delivery Instructions" included in this Letter of Transmittal, or (b) the
Shares are tendered for the account of a firm (an "Eligible Institution")
which is a broker, dealer, commercial bank, credit union, savings association
or other entity which is a member in good standing of a stock transfer
association's approved medallion program (such as STAMP, SEMP or MSP). In all
other cases, all signatures on this Letter of Transmittal must be guaranteed
by an Eligible Institution. See Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND CERTIFICATES. This Letter of
Transmittal is to be used (a) if Shares are to be forwarded herewith, (b) if
uncertificated Shares held by the Fund's transfer agent pursuant to the Fund's
Dividend made by book-entry transfer to the account maintained by the
Depositary pursuant to the procedure set forth in Section 4 of the Offer to
Purchase.
THE METHOD OF DELIVERY OF ANY DOCUMENTS, INCLUDING SHARE CERTIFICATES, THIS
LETTER OF TRANSMITTAL, AND ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY
THROUGH ANY BOOK-ENTRY TRANSFER FACILITY, AND THE PROCESSING FEE IS AT THE
OPTION AND SOLE RISK OF THE TENDERING STOCKHOLDER. IN ALL CASES, SUFFICIENT
TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY. Delivery will be deemed made
only when actually received by the Depositary. If delivery is by mail,
registered mail with return receipt requested, properly insured, is
recommended. Stockholders have the responsibility to cause their Shares (in
proper certificated or uncertificated form), this Letter of Transmittal (or a
copy or facsimile hereof) properly completed and bearing original signature(s)
and the original of any required signature guarantee(s), any other documents
required by this Letter of Transmittal and the Processing Fee to be timely
delivered in accordance with the Offer.
The Fund will not accept any alternative, conditional or contingent tenders.
All tendering Stockholders, brokers, dealers, commercial banks, trust
companies and other nominees, by execution of this Letter of Transmittal (or a
copy or facsimile hereof), waive any right to receive any notice of the
acceptance of their tender.
3. INADEQUATE SPACE. If the space provided in any of the boxes to be
completed is inadequate, the necessary information should be listed on a
separate schedule signed by all of the required signatories and attached
hereto.
4. TENDER OF ALL SHARES HELD BY THE STOCKHOLDER. A Stockholder wishing to
accept the Offer must tender, or cause the tender of, all Shares owned by the
Stockholder and all Shares attributed to the Stockholder for Federal income
tax purposes under Section 318 of the Internal Revenue Code of 1986, as
amended, as of the date of purchase of Shares pursuant to the Offer.
Stockholders should consult their tax advisors as to the application of the
constructive ownership rules of Section 318. If more than 1,297,906 Shares are
duly tendered prior to the expiration of the Offer (and not timely withdrawn),
the Fund will purchase Shares from tendering Stockholders, in accordance with
the terms and subject to the conditions specified in the Offer to Purchase, on
a pro rata basis (disregarding fractions) in accordance with the number of
Shares duly tendered by each Stockholder during the period the Offer is open
(and not timely withdrawn), unless the Fund determines not to purchase any
Shares. Certificates representing Shares tendered but not purchased will be
returned promptly following the termination, expiration or withdrawal of the
Offer, without further expense to the tendering Stockholder.
5. SIGNATURES ON LETTER OF TRANSMITTAL, AUTHORIZATIONS AND ENDORSEMENTS.
If this Letter of Transmittal is signed by the registered holder(s) of the
Shares tendered hereby, the signature(s) must correspond with the name(s) as
written on the face of the certificate(s) for the Shares tendered without
alteration, enlargement or any change whatsoever.
If any of the Shares tendered hereby are owned of record by two or more
joint owners, all such owners must sign this Letter of Transmittal.
<PAGE>
If any of the tendered Shares are registered in different names (including
Shares attributed to the tendering Stockholder for Federal income tax purposes
under Section 318 of the Code) on several certificates, it is necessary to
complete, sign and submit as many separate Letters of Transmittal as there are
different registrations.
If this Letter of Transmittal or any certificate for Shares tendered or
stock powers relating to Shares tendered are signed by trustees, executors,
administrators, guardians, attorneys-in-fact, officers of corporations or
others acting in a fiduciary or representative capacity, such persons should
so indicate when signing, and proper evidence satisfactory to the Fund of
their authority so to act must be submitted.
If this Letter of Transmittal is signed by the registered holder(s) of the
Shares transmitted hereby, no endorsements of certificates or separate stock
powers are required unless payment is to be made to, or certificates for
Shares not purchased are to be issued in the name of, a person other than the
registered holder(s). Signatures on such certificates or stock powers must be
guaranteed by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the certificate(s) listed thereon, the certificate(s)
must be endorsed or accompanied by appropriate stock powers, in either case
signed exactly as the name(s) of the registered holder(s) appear(s) on the
certificate(s) for the Shares involved. Signatures on such certificates or
stock powers must be guaranteed by an Eligible Institution.
6. TRANSFER TAXES. The Fund will pay any transfer taxes payable on the
transfer to it of Shares purchased pursuant to the Offer, provided, however,
that if (a) payment of the Purchase Price is to be made to, or (in the
circumstances permitted by the Offer) unpurchased Shares are to be registered
in the name(s) of, any person(s) other than the registered owner(s), or (b) if
any tendered certificate(s) are registered, or the Shares tendered are
otherwise held, in the name(s) of any person(s) other than the registered
owner, the amount of any transfer taxes (whether imposed on the registered
owner(s) or such other person(s)) payable on account of the transfer to such
person(s) will be deducted from the Purchase Price unless satisfactory
evidence of the payment of such taxes, or exemption therefrom, is submitted
herewith.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If certificate(s) for
unpurchased Shares and/or check(s) are to be issued in the name of a person
other than the registered owner(s) or if such certificate(s) and/or check(s)
are to be sent to someone other than the registered owner(s) or to the
registered owner(s) at a different address, the captioned boxes "Special
Payment Instructions" and/or "Special Delivery Instructions" in this Letter of
Transmittal must be completed.
8. DETERMINATIONS OF VALIDITY. All questions as to the validity, form,
eligibility (including time of receipt) and acceptance of tenders will be
determined by the Fund, in its sole discretion, which determination shall be
final and binding. The Fund reserves the absolute right to reject any or all
tenders determined not to be in appropriate form or not accompanied by the
Processing Fee or to refuse to accept for payment, purchase or pay for, any
Shares if, in the opinion of the Fund's counsel, accepting, purchasing or
paying for such Shares would be unlawful. The Fund also reserves the absolute
right to waive any of the conditions of the Offer or any defect in any tender,
whether generally or with respect to any particular Share(s) or
Stockholder(s). The Fund's interpretations of the terms and conditions of the
Offer (including these instructions) shall be final and binding.
NEITHER THE FUND, ITS BOARD OF DIRECTORS, ALLIANCE CAPITAL MANAGEMENT L.P.
(THE FUND'S INVESTMENT ADVISER), THE DEPOSITARY NOR ANY OTHER PERSON IS OR
WILL BE OBLIGATED TO GIVE ANY NOTICE OF ANY DEFECT OR IRREGULARITY IN ANY
TENDER, AND NONE OF THEM WILL INCUR ANY LIABILITY FOR FAILURE TO GIVE ANY SUCH
NOTICE.
9. QUESTIONS AND REQUESTS FOR ASSISTANCE AND ADDITIONAL COPIES. Questions
and requests for assistance may be directed to the Depositary at the mailing
address provided above or by telephoning (800) 331-1710. Requests for
additional copies of the Offer to Purchase and this Letter of Transmittal may
be directed to Corporate Investor Communications, Inc., the Distribution
Agent, by telephoning (800) 346-7885. Stockholders who do not own Shares
directly may also obtain such information and copies from their broker,
dealer, commercial bank, trust company or other nominee. Stockholders who do
not own Shares directly are required to tender their Shares through their
broker, dealer, commercial bank, trust company or other nominee and should NOT
submit this Letter of Transmittal to the Depositary.
<PAGE>
10. RESTRICTION ON SHORT SALES. Section 14(e) of the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), and Rule 14e-4 promulgated
thereunder, make it unlawful for any person, acting alone or in concert with
others, to tender Shares in a partial tender offer for such person's own
account unless at the time of tender, and at the time the Shares are accepted
for payment, the person tendering has a net long position equal to or greater
than the amount tendered in (a) Shares, and will deliver or cause to be
delivered such Shares for the purpose of tender to the person making the Offer
within the period specified in the Offer, or (b) an equivalent security and,
upon acceptance of his or her tender, will acquire Shares by conversion,
exchange, or exercise of such equivalent security to the extent required by
the terms of the Offer, and will deliver or cause to be delivered the Shares
so acquired for the purpose of tender to the Fund prior to or on the
Expiration Date. Section 14(e) and Rule 14e-4 provide a similar restriction
applicable to the tender or guarantee of a tender on behalf of another person.
The acceptance of Shares by the Fund for payment will constitute a binding
agreement between the tendering Stockholder and the Fund upon the terms and
subject to the conditions of the Offer, including the tendering Stockholder's
representation that the Stockholder has a net long position in the Shares
being tendered within the meaning of Rule 14e-4 and that the tender of such
Shares complies with Rule 14e-4.
11. BACKUP WITHHOLDING TAX. Under the U.S. federal income tax laws, the
Depositary may be required to withhold 31% of the amount of any payment made
to certain holders pursuant to the Offer. In order to avoid such backup
withholding tax, each tendering U.S. Stockholder who has not already submitted
a correct, completed and signed Form W-9 or Substitute Form W-9 to the Fund
should provide the Depositary with the Stockholder's correct taxpayer
identification number ("TIN") by completing a Substitute Form W-9, a copy of
which is included in this Letter of Transmittal. In general, if a U.S.
Stockholder is an individual, the TIN is the individual's Social Security
number. If the Depositary is not provided with the correct TIN, the U.S.
Stockholder may be subject to a penalty imposed by the Internal Revenue
Service. The box in Part 2 of the Substitute Form W-9 may be checked if the
tendering Stockholder has not been issued a TIN and has applied for a TIN or
intends to apply for a TIN in the near future. If the box in Part 2 is checked
and payment of the purchase price of Shares is made within 60 days of the
receipt by the Depositary of the Substitute Form W-9, the Depositary is not
required to withhold any backup withholding tax from the payment. Certain U.S.
Stockholders (including, among others, all U.S. corporations) are not subject
to these backup withholding and reporting requirements, but should nonetheless
complete a Substitute Form W-9 to avoid the possible erroneous imposition of a
backup withholding tax.
In order for a non-U.S. Stockholder to avoid the 31% backup withholding tax,
the non-U.S. Stockholder must submit a statement to the Depositary signed
under penalties of perjury attesting as to its non-U.S. status. A copy of Form
W-8 and instructions for completing that form are enclosed for such
Stockholders.
Backup withholding tax is not an additional federal income tax. Rather, the
federal income tax liability of a person subject to backup withholding tax
will be reduced by the amount of tax withheld. If backup withholding results
in an overpayment of taxes, the Stockholder may claim a refund from the
Internal Revenue Service. All Stockholders are urged to consult their own tax
advisors as to the specific tax consequences to them of the Offer.
The tax information set forth above is included for general information only
and may not be applicable to the situations of certain taxpayers.
* * *
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A COPY OR FACSIMILE HEREOF)
PROPERLY COMPLETED AND BEARING ORIGINAL SIGNATURE(S) AND THE ORIGINAL OF ANY
REQUIRED SIGNATURE GUARANTEE(S), SHARES (IN PROPER CERTIFICATED OR
UNCERTIFICATED FORM), OTHER REQUIRED DOCUMENTS AND THE PROCESSING FEE MUST BE
RECEIVED BY THE DEPOSITARY, OR A PROPERLY COMPLETED AND DULY EXECUTED NOTICE
OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE DEPOSITARY PRIOR TO THE
EXPIRATION OF THE OFFER.
<PAGE>
PAYER'S NAME: BANKBOSTON, N.A., DEPOSITARY
PART 1--PLEASE PROVIDE YOUR Social Security Number
SUBSTITUTE TIN IN THE BOX AT THE RIGHT or
FORM W-9 AND CERTIFY BY SIGNING AND Employer Identification
DATING BELOW Number
CERTIFICATION--UNDER PENALTIES OF
PERJURY, I CERTIFY THAT: (1) THE IN-
FORMATION PROVIDED ON THIS FORM IS
TRUE, CORRECT AND COMPLETE, AND (2) I
AM NOT SUBJECT TO BACKUP WITHHOLDING
EITHER BECAUSE I AM EXEMPT FROM
BACKUP WITHHOLDING OR I HAVE NOT BEEN
NOTIFIED BY THE INTERNAL REVENUE
SERVICES (THE "IRS") THAT I AM SUB-
JECT TO BACKUP WITHHOLDING AS A RE-
SULT OF UNDERREPORTING INTEREST OR
DIVIDENDS OR THE IRS HAS NOTIFIED ME
THAT I AM NO LONGER SUBJECT TO BACKUP
WITHHOLDING. (YOU MUST CROSS OUT ITEM
(2) IN THE IMMEDIATELY PRECEDING SEN-
TENCE IF YOU HAVE BEEN NOTIFIED BY
THE IRS THAT YOU ARE CURRENTLY SUB-
JECT TO BACKUP WITHHOLDING BECAUSE
YOU FAILED TO REPORT ALL INTEREST AND
DIVIDENDS ON YOUR RETURN.)
DEPARTMENT OF
THE TREASURY ----------------------
INTERNAL --------------------------------------------------------
REVENUE
SERVICE
PART 2
Awaiting
TIN [_]
PAYER'S REQUEST FOR TAXPAYER IDENTIFICATION NUMBER (TIN)
Please see
below.
Signature: _____________ Date: ______
Name: ________________________________
(PLEASE PRINT)
Address: _____________________________
______________________________________
(INCLUDE ZIP CODE)
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECK THE BOX
IN PART 2 OF SUBSTITUTE FORM W-9
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER CERTIFICATION
I certify, under penalties of perjury, that a Taxpayer Identification
Number has not been issued to me, and that I have mailed or delivered an
application to receive a Taxpayer Identification Number to the appropriate
Internal Revenue Service Center or Social Security Administration Office
(or I intend to mail or deliver an application in the near future). I
understand that if I do not provide a Taxpayer Identification Number to the
payer within 60 days, the Depositary is required to withhold 31% of all
payments due to me pursuant to the Offer.
_________________________________________________________ _________________
SIGNATURE DATE
<PAGE>
EXHIBIT (a)(2)(ii)
Form W-8 CERTIFICATE OF FOREIGN STATUS
(Rev. November 1992)
Department of the Treasury
Internal Revenue Service
- --------------------------------------------------------------------------------
PLEASE PRINT OR TYPE
Name of owner (if joint account, also give joint owner's name.) (See
Specific Instructions.)
U.S. taxpayer
identification
number (if any)
----------------------------------------------------------------------------
Permanent address (See Specific Instructions.) (Include apt. or suite no.)
----------------------------------------------------------------------------
City, province or state, postal code, and country
----------------------------------------------------------------------------
Current mailing address, if different from permanent address (Include apt.
or suite no., or P.O. box if mail is not delivered to street address.)
----------------------------------------------------------------------------
City, town or post office, state, and ZIP code (If foreign address, enter
city, province or state, postal code, and country.)
- --------------------------------------------------------------------------------
Account number Account type Account number Account type
List account information here (Optional, see Specific Instructions.)
- --------------------------------------------------------------------------------
NOTICE OF CHANGE IN STATUS.--To notify the payer, mortgage interest recipient,
broker, or barter exchange that you no longer qualify for exemption, check
here...................................................................... [_]
IF YOU CHECK THIS BOX, REPORTING WILL BEGIN ON THE ACCOUNT(S) LISTED.
- --------------------------------------------------------------------------------
PLEASE SIGN HERE
CERTIFICATION.--(Check applicable box(es)). Under penalties of perjury,
I certify that:
[_]For INTEREST PAYMENTS, I am not a U.S. citizen or resident (or I am
filing for a foreign corporation, partnership, estate, or trust).
[_]For DIVIDENDS, I am not a U.S. citizen or resident (or I am filing
for a foreign corporation, partnership, estate, or trust).
[_]For BROKER TRANSACTIONS OR BARTER EXCHANGES, I am an exempt foreign
person as defined in the instructions below.
---------------------------------------------------------------------
Signature Date
- --------------------------------------------------------------------------------
GENERAL INSTRUCTIONS
(Section references are to the Internal Revenue Code, unless otherwise stated.)
PURPOSE
Use Form W-8 or a substitute form containing a substantially similar statement
to tell the payer, mortgage interest recipient, middleman, broker, or barter
exchange that you are a nonresident alien individual, foreign entity, or exempt
foreign person not subject to certain U.S. information return reporting or
backup withholding rules.
CAUTION: Form W-8 does not exempt the payee from the 30% (or lower treaty)
nonresident withholding rates.
NONRESIDENT ALIEN INDIVIDUAL
For income tax purposes, "nonresident alien individual" means an individual who
is neither a U.S. citizen nor resident. Generally, an alien is considered to be
a U.S. resident if:
. The individual was a lawful permanent resident of the United States at any
time during the calendar year, that is, the alien held an immigrant visa (a
"green card"), or
. The individual was physically present in the United States on:
(1) at least 31 days during the calendar year, and
(2) 183 days or more during the current year and the 2 preceding calendar
years (counting all the days of physical presence in the current year, one-
third the number of days of presence in the first preceding year, and only one-
sixth of the number of days in the second preceding year).
See Pub. 519, U.S. Tax Guide for Aliens, for more information on resident and
nonresident alien status.
NOTE: If you are a nonresident alien individual married to a U.S. citizen or
resident and have made an election under section 6013(g) or (h), you are
treated as a U.S. resident and may not use Form W-8.
EXEMPT FOREIGN PERSON
For purposes of this form, you are an "exempt foreign person" for a calendar
year in which:
1. You are a nonresident alien individual or a foreign corporation,
partnership, estate or trust,
2. You are an individual who has not been, and plans not to be, present in the
United States for a total of 183 days or more during the calendar year, and
3. You are neither engaged, nor plan to be engaged during the year, in a U.S.
trade or business that has effectively connected gains from transactions with a
broker or barter exchange.
If you do not meet the requirements of 2 or 3 above, you may instead certify
on FORM 1001, Ownership, Exemption, or Reduced Rate Certificate, that your
country has a tax treaty with the United States that exempts your transactions
from U.S. tax.
FILING INSTRUCTIONS
WHEN TO FILE.--File Form W-8 or substitute form before a payment is made.
Otherwise, the payer may have to withhold and send part of the payment to the
Internal Revenue Service (see Backup Withholding below). This certificate
generally remains in effect for three calendar years. However, the payer may
require you to file a new certificate each time a payment is made to you.
WHERE TO FILE.--File this form with the payer of the qualifying income who is
the withholding agent (see WITHHOLDING AGENT on page 2). Keep a copy for your
own records.
BACKUP WITHHOLDING
A U.S. taxpayer identification number or Form W-8 or substitute form must be
given to the payers of certain income. If a taxpayer identification number or
Form W-8 or substitute form is not provided or the wrong taxpayer
identification number is provided, these payers may have to withhold 20% of
each payment or transaction. This is called backup withholding.
NOTE: On January 1, 1993, the backup withholding rate increases from 20% to
31%.
Reportable payments subject to backup withholding rules are:
. Interest payments under section 6049(a).
. Dividend payments under sections 6042(a) and 6044.
. Other payments (i.e., royalties and payments from brokers and barter
exchanges) under sections 6041, 6041A(a), 6045, 6050A, and 6050N.
If backup withholding occurs, an exempt foreign person who is a nonresident
alien individual may get a refund by filing Form 1040NR, U.S. Nonresident Alien
Income Tax Return, with the Internal Revenue Service Center, Philadelphia, PA
19255, even if filing the return is not otherwise required.
(Continued on back.)
- --------------------------------------------------------------------------------
Form W-8 (Rev. 11-92)
Cat. No. 10230M
<PAGE>
Form W-8 (Rev. 11-92) Page 2
- --------------------------------------------------------------------------------
U.S. TAXPAYER IDENTIFICATION NUMBER
The Internal Revenue law requires that certain income be reported to the
Internal Revenue Service using a U.S. taxpayer Identification number (TIN).
This number can be a social security number assigned to individuals by the
Social Security Administration or an employer identification number assigned to
businesses and other entities by the Internal Revenue Service.
Payments to account holders who are foreign persons (nonresident alien
individuals, foreign corporations, partnerships, estates, or trusts) generally
are not subject to U.S. reporting requirements. Also, foreign persons are not
generally required to have a TIN, nor are they subject to any backup
withholding because they do not furnish a TIN to a payer or broker.
However, foreign persons with income effectively connected with a trade or
business in the United States (income subject to regular (graduated) income
tax), must have a TIN. To apply for a TIN, use Form SS-4, Application for
Employer Identification Number, available from local Internal Revenue Service
offices, or Form SS-5, Application for a Social Security Card, available from
local Social Security Administration offices.
SPECIAL RULES
MORTGAGE INTEREST.--For purposes of the reporting rules, mortgage interest is
interest paid on a mortgage to a person engaged in a trade or business
originating mortgages in the course of that trade or business. A mortgage
interest recipient is one who receives interest on a mortgage that was acquired
in the course of a trade or business.
Mortgage interest is not subject to backup withholding rules, but is subject
to reporting requirements under section 6050H. Generally, however, the
reporting requirements do not apply if the payer of record is a nonresident
alien individual who pays interest on a mortgage not secured by real property
in the United States. Use Form W-8 or substitute form to notify the mortgage
interest recipient that the payer is a nonresident alien individual.
PORTFOLIO INTEREST.--Generally, portfolio interest paid to a nonresident alien
individual or foreign partnership, estate, or trust is not subject to backup
withholding rules. However, if interest is paid on portfolio investments to a
beneficial owner that is neither a financial institution nor a member of a
clearing organization, Form W-8 or substitute form is required.
Registered obligations not targeted to foreign markets qualify as portfolio
interest not subject to 30% withholding, but require the filing of Form W-8 or
substitute form. See instructions to Withholding Agents on this page for
reporting rules.
See PUB. 515, Withholding of Tax on Nonresident Aliens and Foreign
Corporations, for registered obligations targeted to foreign markets and when
Form W-8 or substitute form is not required on these payments.
BEARER OBLIGATIONS.--The interest from bearer obligations targeted to foreign
markets is treated as portfolio interest and is not subject to 30% withholding.
Form W-8 or substitute form is not required.
DIVIDENDS.--Any distribution or payment of dividends by a U.S. corporation sent
to a foreign address is subject to the 30% (or lower treaty) withholding rate,
but is not subject to backup withholding. Also, there is no backup withholding
on dividend payments made to a foreign person by a foreign corporation.
However, the 30% withholding (or lower treaty) rate applies to dividend
payments made to a foreign person by a foreign corporation if:
. 25% or more of the foreign corporation's gross income for the three preceding
taxable years was effectively connected with a U.S. trade or business, and
. The corporation was not subject to the branch profits tax because of an
income tax treaty (see section 884(e)).
If a foreign corporation makes payments to another foreign corporation, the
recipient must be a qualified resident of its country of residence to benefit
from that country's tax treaty.
BROKER OR BARTER EXCHANGES.--Income from transactions with a broker or barter
exchanges is subject to reporting rules and backup withholding unless Form W-8
or substitute form is filed to notify the broker or barter exchange that you
are an exempt foreign person as defined on page 1.
SPECIFIC INSTRUCTIONS
NAME OF OWNER.--If Form W-8 is being filed for portfolio interest, enter the
name of the beneficial owner.
U.S. TAXPAYER IDENTIFICATION NUMBER.-- If you have a U.S. taxpayer
identification number, enter your number in this space (see the discussion
earlier).
PERMANENT ADDRESS.--Enter your complete address in the country where you reside
permanently for income tax purposes.
<TABLE>
<CAPTION>
IF YOU ARE: SHOW THE
ADDRESS OF:
<S> <C>
An individual Your permanent
residence
A partnership Principal office
or corporation
An estate or Permanent residence
trust or principal office of
any fiduciary
</TABLE>
Also show your current mailing address if it differs from your permanent
address.
ACCOUNT INFORMATION (OPTIONAL).--If you have more than one account (savings,
certificate of deposit, pension, IRA, etc.) with the same payer, list all
account numbers and types on one Form W-8 or substitute form unless your payer
requires you to file a separate certificate for each account.
If you have more than one payer, file a separate Form W-8 with each payer.
SIGNATURE.--If only one foreign person owns the account(s) listed on this form,
that foreign person should sign the Form W-8.
If each owner of a joint account is a foreign person, each should sign a
separate Form W-8.
NOTICE OF CHANGE IN STATUS.--If you become a U.S. citizen or resident after you
have filed Form W-8 or substitute form, or you cease to be an exempt foreign
person, you must notify the payer in writing within 30 days of your change in
status.
To notify the payer, you may check the box in the space provided on this form
or use the method prescribed by the payer.
Reporting will then begin on the account(s) listed and backup withholding may
also begin unless you certify to the payer that:
(1) The U.S. taxpayer identification number you have given is correct, and
(2) The Internal Revenue Service has not notified you that you are subject to
backup withholding because you failed to report certain income.
You may use Form W-9, Request for Taxpayer Identification Number and
Certification, to make these certifications.
If an account is no longer active, you do not have to notify a payer of your
change in status unless you also have another account with the same payer that
is still active.
FALSE CERTIFICATE.--If you file a false certificate when you are not entitled
to the exemption from withholding or reporting, you may be subject to fines
and/or imprisonment under U.S. perjury laws.
INSTRUCTIONS TO WITHHOLDING AGENTS
WITHHOLDING AGENT.--Generally, the person responsible for payment of the items
discussed above to a nonresident alien individual or foreign entity is the
withholding agent (see Pub. 515).
RETENTION OF STATEMENT.--Keep Form W-8 or substitute form in your records for
at least four years following the end of the last calendar year during which
the payment is paid or collected.
PORTFOLIO INTEREST.--Although registered obligations not targeted to foreign
markets are not subject to 30% withholding, you must file Form 1042S, Foreign
Person's U.S. Source Income Subject to Withholding, to report the interest
payment. Both Form 1042S and a copy of Form W-8 or substitute form must be
attached to Form 1042, Annual Withholding Tax Return for U.S. Source Income of
Foreign Persons.
<PAGE>
EXHIBIT (a)(2)(iii)
NOTICE OF GUARANTEED DELIVERY
REGARDING THE OFFER BY
ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
TO PURCHASE FOR CASH 1,297,906 OF ITS ISSUED AND OUTSTANDING
SHARES AT NET ASSET VALUE PER SHARE
This form must be used to accept the Offer (as defined below) if a
Stockholder's certificates for Shares are not immediately available or if time
will not permit the Letter of Transmittal and other required documents to
reach the Depositary on or before the Expiration Date. Each term used in this
form that is not otherwise defined herein shall have the meaning specified in
the Offer to Purchase dated December 10, 1997. This form may be delivered by
hand, overnight courier or mail to the Depositary at the appropriate address
set forth below AND MUST BEAR ORIGINAL SIGNATURES (NOT PHOTOCOPIES OR
FACSIMILES). Tenders using this form may be made only by or through an
Eligible Institution as defined in Section 4(b) of the Offer to Purchase.
Depositary Addresses:
By Registered, Certified
or Express
By First Class Mail: Mail or Overnight By Hand:
Courier:
Boston EquiServe, L.P. Boston EquiServe, L.P. Securities Transfer and
Corporate Reorganization Corporate Reorganization Reporting Services, Inc.
P.O. Box 9061 70 Campanelli Drive Boston EquiServe, L.P.
Boston, MA 02205-8686 Braintree, MA 02184 Corporate Reorganization
1 Exchange Plaza
55 Broadway, Third Floor
New York, NY 10006
Depositary Telephone Number: (800) 331-1710
Depositary Telephone Number to Confirm Receipt of Notices: (617) 794-6388
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS
OTHER THAN AS SET FORTH ABOVE DOES NOT
CONSTITUTE VALID DELIVERY.
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to Alliance World Dollar Government Fund,
Inc. (the "Fund"), upon the terms and subject to the conditions set forth in
its Offer to Purchase dated December 10, 1997 and the related Letter of
Transmittal (which together constitute the "Offer"), receipt of which are
hereby acknowledged, (i) the number of Shares specified below pursuant to the
guaranteed delivery procedures set forth in Section 4(e) of the Offer to
Purchase and (ii) all Shares held in the name(s) of the registered holder(s)
by the Fund's transfer agent pursuant to the Fund's Dividend Reinvestment
Plan.
(PLEASE PRINT EXCEPT FOR SIGNATURE(S))
Number of Shares Tendered: __________
Certificate Nos. (if available): ____ Name(s) of Record Holder(s): ________
_____________________________________ _____________________________________
_____________________________________ _____________________________________
If Shares will be tendered by book- Address: ____________________________
entry transfer to The Depository
Trust Company, please check
box: [_]
_____________________________________
_____________________________________
DTC Participant Number: _____________ Telephone Number, including Area
Code:
_____________________________________
If the undersigned is the beneficial owner of the Shares being tendered, the
undersigned hereby represents and warrants that all Shares owned by the
undersigned as of the date of purchase of Shares by the Fund pursuant to the
Offer and all Shares attributed to the undersigned for Federal income tax
purposes as of such date under Section 318 of the Internal Revenue Code of
1986, as amended, have been or will be tendered pursuant to the Offer.
Dated: _______________________, 199
INDIVIDUAL(S) ENTITY
_____________________________________ _____________________________________
Name of Firm
_____________________________________
Signature(s) _____________________________________
Authorized Signature
Name: _______________________________
Title: ______________________________
2
<PAGE>
GUARANTEE
The undersigned, an Eligible Institution as defined in Section 4(b) of the
Offer to Purchase, hereby, with respect to the Shares tendered hereby pursuant
to the guaranteed delivery procedures set forth in Section 4(e) of the Offer
to Purchase: (a) represents that the person(s) named on the previous page
"own(s)" such Shares within the meaning of Rule 14e-4 under the Securities
Exchange Act of 1934, as amended; (b) represents that the tender of such
Shares complies with Rule 14e-4; and (c) guarantees to deliver to the
Depositary certificates representing such Shares, in proper form for transfer
(or to tender Shares pursuant to the procedure for book-entry transfer into
the Depositary's account at The Depository Trust Company if so specified on
the foregoing page), together with a properly completed and duly executed
Letter of Transmittal with any required signature guarantees, any other
required documents, and the $25.00 Processing Fee payable to BankBoston, N.A.,
prior to 5:00 P.M. Eastern Time on the second New York Stock Exchange trading
day after the date of execution of this Guarantee.
(PLEASE PRINT EXCEPT FOR SIGNATURE)
Name of Firm: _________________________________________________________________
Authorized Signature: _________________________________________________________
Name: _________________________________________________________________________
Title: ________________________________________________________________________
Address: ______________________________________________________________________
_______________________________________________________________________________
(Include Zip Code)
_______________________________________________________________________________
Telephone Number, including Area Code: ________________________________________
Dated: _______________________, 199
3
<PAGE>
EXHIBIT (a)(3)(i)
FORM OF LETTER TO BROKERS, DEALERS,
COMMERCIAL BANKS, TRUST COMPANIES AND OTHER NOMINEES
REGARDING THE OFFER BY
ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
TO PURCHASE FOR CASH 1,297,906 OF ITS ISSUED AND OUTSTANDING
SHARES AT NET ASSET VALUE PER SHARE
To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
Pursuant to your request, we are enclosing the material listed below
relating to the offer by Alliance World Dollar Government Fund, Inc. (the
"Fund") to purchase 1,297,906 of its issued and outstanding shares of common
stock, par value $0.01 per share (the "Shares"), for cash at a price equal to
their net asset value ("NAV") determined as of the close of the regular
trading session of the New York Stock Exchange ("NYSE") on January 8, 1998
upon the terms and subject to the conditions set forth in the Offer to
Purchase dated December 10, 1997 and the related Letter of Transmittal (which
together constitute the "Offer"). THE OFFER EXPIRES AT 12:00 MIDNIGHT EASTERN
TIME ON JANUARY 8, 1998, UNLESS EXTENDED (THE "EXPIRATION DATE"). If the Offer
is extended beyond January 8, 1998, the purchase price for Shares will be
their NAV determined as of the close of the regular trading session of the
NYSE on the new Expiration Date.
The following documents are enclosed:
(1) Offer to Purchase dated December 10, 1997;
(2) Letter of Transmittal to be used to tender all Shares;
(3) Notice of Guaranteed Delivery;
(4) Form of Letter to Clients, which may be sent upon request for
information by your clients for whose account you hold shares registered in
your name (or in the name of your nominee); and
(5) Questions and Answers regarding the Offer (for internal use only, not
for distribution to your clients or others).
No fees or commissions will be payable to brokers, dealers or other persons
for soliciting tenders of Shares pursuant to the Offer. The Fund will pay all
transfer taxes on its purchase of Shares, subject to Instruction 6 of the
Letter of Transmittal. Backup withholding tax at a 31% rate may be required
unless an exemption is proved or unless the required taxpayer identification
information is or has previously been provided to the Fund or the Depositary.
Certain withholdings may also apply with respect to payments to non-U.S.
Stockholders. See Instruction 11 of the Letter of Transmittal.
The Offer is not being made to (nor will tenders be accepted from or on
behalf of) Stockholders in any jurisdiction in which the making of the Offer
or the acceptance thereof would not be in compliance with the laws of such
jurisdiction. In any jurisdiction where the securities, blue sky or other laws
require the Offer to be made by a licensed broker or dealer, the Offer shall
be deemed to be made on behalf of the Fund by one or more registered brokers
or dealers licensed under the laws of that jurisdiction.
If a client instructs you by telephone to tender Shares, please record the
telephone conversation (in accordance with applicable law) and ask the client
to affirm that all Shares owned by such client as of the date of purchase of
Shares pursuant to the Offer and all Shares attributed to such client for
Federal income tax purposes as of such date under Section 318 of the Internal
Revenue Code of 1986, as amended, have been or will be tendered pursuant to
the Offer.
Additional copies of the enclosed material may be obtained from Corporate
Investor Communications, Inc., the Distribution Agent, in the manner indicated
in the Offer to Purchase. Any questions you have with respect to the Offer
should be directed to BankBoston, N.A., the Depositary, at (800) 331-1710.
Very truly yours,
Alliance World Dollar Government Fund,
Inc.
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU
OR ANY OTHER PERSON AS THE AGENT OF EITHER THE FUND OR THE DEPOSITARY OR
AUTHORIZE YOU OR ANY OTHER PERSON TO MAKE ANY STATEMENTS WITH RESPECT TO
THE OFFER, OTHER THAN THE STATEMENTS SPECIFICALLY SET FORTH IN THE OFFER TO
PURCHASE AND THE LETTER OF TRANSMITTAL, OR TO DISTRIBUTE ANY MATERIAL WITH
RESPECT TO THE OFFER OTHER THAN AS SPECIFICALLY AUTHORIZED HEREIN.
<PAGE>
EXHIBIT (a)(3)(ii)
FORM OF LETTER TO CLIENTS OF BROKERS, DEALERS,
COMMERCIAL BANKS, TRUST COMPANIES AND OTHER NOMINEES
REGARDING THE OFFER BY
ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
TO PURCHASE FOR CASH 1,297,906 OF ITS ISSUED AND OUTSTANDING
SHARES AT NET ASSET VALUE PER SHARE
To Our Clients:
Pursuant to your request, enclosed for your consideration are the Offer to
Purchase dated December 10, 1997 of Alliance World Dollar Government Fund,
Inc. (the "Fund") and the related Letter of Transmittal pursuant to which the
Fund is offering to purchase 1,297,906 shares of its issued and outstanding
common stock, par value $0.01 per share (the "Shares"), for cash at a price
equal to their net asset value ("NAV") determined as of the close of the
regular trading session of the New York Stock Exchange ("NYSE") on January 8,
1998, upon the terms and subject to the conditions set forth in the Offer to
Purchase dated December 10, 1997 and the related Letter of Transmittal (which
together constitute the "Offer"). THE OFFER EXPIRES AT 12:00 MIDNIGHT EASTERN
TIME ON JANUARY 8, 1997, UNLESS EXTENDED (THE "EXPIRATION DATE"). If the Offer
is extended beyond January 8, 1998, the purchase price for Shares will be
their NAV determined as of the close of the regular trading session of the
NYSE on the new Expiration Date, as extended.
The Offer is being made to fulfill an undertaking made in connection with
the initial public offering of the Shares. Information regarding this
undertaking, as well as information regarding possible future tender offers by
the Fund, is set forth in the Offer to Purchase.
The Offer to Purchase and the Letter of Transmittal are being forwarded to
you as the beneficial owner of Shares held by us for your account but not
registered in your name. We are sending you the Letter of Transmittal for your
information only; you cannot use it to tender Shares we hold for your account.
A tender of such Shares can be made only by us as the holder of record and
only pursuant to your instructions.
Your attention is called to the following:
1. Unless extended, the Offer expires at 12:00 Midnight Eastern Time on
January 8, 1998 and withdrawal rights expire at 5:00 P.M. Eastern Time on
January 12, 1998.
2. The Offer is subject to certain conditions set forth in the Offer to
Purchase. Under certain circumstances, the Fund will not be required to
accept for payment, purchase or pay for any Shares tendered, and the Fund
may also amend, extend or terminate the Offer.
3. A Stockholder wishing to accept the Offer must tender, or cause the
tender of, all Shares owned by the Stockholder and all Shares attributed to
the Stockholder for Federal income tax purposes under Section 318 of the
Internal Revenue Code of 1986, as amended, as of the date of purchase of
Shares pursuant to the Offer. Stockholders should consult their tax
advisors as to the application of the constructive ownership rules of
Section 318.
4. If more than 1,297,906 Shares are duly tendered (and not timely
withdrawn), the Fund will purchase Shares from tendering Stockholders, in
accordance with the terms and subject to the conditions specified in the
Offer to Purchase, on a pro rata basis (disregarding fractions) in
accordance with the number of Shares duly tendered by each Stockholder
during the period the Offer is open (and not timely withdrawn), unless the
Fund determines not to purchase any Shares.
5. Each tendering Stockholder is required to submit a check in the amount
of $25.00 payable to BankBoston, N.A. as a processing fee to help defray
the cost associated with effecting the Offer. A broker, dealer, commercial
bank, trust company or other nominee may also charge a fee for processing
transactions on behalf of a Stockholder. Tendering Stockholders are not
obligated to pay brokerage commissions or, subject to Instruction 6 of the
Letter of Transmittal, transfer taxes on the purchase of Shares by the Fund
pursuant to the Offer.
IF YOU WISH TO HAVE US TENDER YOUR SHARES, PLEASE SO INSTRUCT US BY
COMPLETING, EXECUTING AND RETURNING TO US THE INSTRUCTION FORM ON THE REVERSE
SIDE HEREOF. YOUR INSTRUCTIONS SHOULD BE FORWARDED TO US IN AMPLE TIME TO
PERMIT US TO SUBMIT A TENDER ON YOUR BEHALF ON OR BEFORE THE EXPIRATION OF THE
OFFER. THE OFFER EXPIRES AT 12:00 MIDNIGHT EASTERN TIME ON JANUARY 8, 1998,
UNLESS EXTENDED.
The Offer is not being made to (nor will tenders be accepted from or on
behalf of) holders of Shares in any jurisdiction in which the Offer or its
acceptance would violate the laws of such jurisdiction. In any jurisdiction
where the securities, blue sky or other laws require the Offer to be made by a
licensed broker or dealer, the Offer shall be deemed to be made on behalf of
the Fund by one or more registered brokers or dealers licensed under the laws
of that jurisdiction.
Very truly yours,
Alliance World Dollar Government Fund,
Inc.
<PAGE>
INSTRUCTIONS REGARDING THE OFFER BY
ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
TO PURCHASE FOR CASH 1,297,906 OF ITS ISSUED AND OUTSTANDING
SHARES AT NET ASSET VALUE PER SHARE
THIS FORM IS NOT TO BE USED TO TENDER SHARES DIRECTLY TO THE DEPOSITARY. IT
SHOULD BE SENT TO YOUR BROKER, DEALER, COMMERCIAL BANK, TRUST COMPANY OR OTHER
NOMINEE ONLY IF THAT FIRM IS THE HOLDER OF RECORD OF YOUR SHARES AND WILL BE
EFFECTING THE TENDER ON YOUR BEHALF.
DO NOT COMPLETE THIS FORM IF YOU HAVE DECIDED NOT TO TENDER YOUR SHARES.
The undersigned acknowledge(s) receipt of your letter and the accompanying
Offer to Purchase dated December 10, 1997 and the related Letter of
Transmittal (which together constitute the "Offer") in connection with the
Offer by Alliance World Dollar Government Fund, Inc. (the "Fund") to purchase
1,297,906 shares of its issued and outstanding common stock, par value $0.01
per share (the "Shares"), at the net asset value per Share as of the close of
the regular trading session of the New York Stock Exchange on the Expiration
Date (as defined in the Offer to Purchase), on the terms and subject to the
conditions of the Offer.
The undersigned hereby instructs you to tender to the Fund all Shares that
are held by you for the account of the undersigned, including all
uncertificated Shares that may be held for the account of the undersigned by
the Fund's transfer agent pursuant to the Fund's Dividend Reinvestment Plan,
upon the terms and subject to the conditions of the Offer.
The undersigned hereby represents and warrants that: (i) all Shares owned by
the undersigned as of the date of purchase of Shares pursuant to the Offer and
all Shares attributed to the undersigned for Federal income tax purposes as of
such date under Section 318 of the Internal Revenue Code of 1986, as amended,
have been or will be tendered pursuant to the Offer; (ii) the undersigned has
a net long position in such Shares within the meaning of Rule 14e-4
promulgated under the Securities Exchange Act of 1934, as amended; and (iii)
the tender of such Shares complies with Rule 14e-4.
(PLEASE PRINT EXCEPT FOR SIGNATURE(S))
Account Number: _____________________
Name(s) and Tax Identification or Social Security Number(s) of Beneficial
Owner(s): _____________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
Address: ______________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
Telephone Number(s) including Area Code(s): ___________________________________
_____________________________________ _____________________________________
(SIGNATURE OF BENEFICIAL OWNER) (SIGNATURE OF ADDITIONAL BENEFICIAL
OWNER, IF ANY)
Dated: , 199
<PAGE>
EXHIBIT (a)(3)(iii)
NOT FOR DISTRIBUTION TO STOCKHOLDERS OR OTHERS
FOR USE ONLY BY ELIGIBLE INSTITUTIONS AND BY THE DEPOSITARY
QUESTIONS AND ANSWERS
REGARDING THE OFFER BY
ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
TO PURCHASE FOR CASH 1,297,906 OF ITS ISSUED AND OUTSTANDING
SHARES AT NET ASSET VALUE PER SHARE
TO BROKERS, DEALERS, COMMERCIAL BANKS,
TRUST COMPANIES AND OTHER NOMINEES
AND TO THE DEPOSITARY:
The following is a set of questions your clients might ask and possible
answers you might give in response concerning the Offer by Alliance World
Dollar Government Fund, Inc. (the "Fund") to purchase 1,297,906 of its issued
and outstanding shares of common stock, par value $0.01 per share, for cash at
a price equal to their net asset value per share determined as of the close of
the regular trading session of the New York Stock Exchange on January 8, 1998,
the date the offer expires (or, if the Offer is extended, on the new
expiration date), upon the terms and subject to the conditions set forth in
the Offer to Purchase dated December 10, 1997 and the related Letter of
Transmittal (which together constitute the "Offer"). THESE QUESTIONS AND
ANSWERS ARE INTENDED ONLY FOR INTERNAL USE BY BROKERS, DEALERS, COMMERCIAL
BANKS, TRUST COMPANIES AND OTHER NOMINEES AND BY THE DEPOSITARY, AND ARE NOT
TO BE TRANSMITTED TO OTHERS. Also, these questions and answers are not
intended as a substitute for a thorough reading and understanding of the terms
and conditions of the Offer. To the extent, if any, that these questions and
answers may differ from the terms and conditions of the Offer, the terms and
conditions of the Offer will prevail.
Any question you have with respect to the Offer should be directed to the
Depositary at (800) 331-1710.
Very truly yours,
Alliance World Dollar Government
Fund, Inc.
NOTHING CONTAINED HEREIN SHALL CONSTITUTE YOU OR ANY OTHER PERSON AS THE
AGENT OF EITHER THE FUND OR THE DEPOSITARY OR AUTHORIZE YOU OR ANY OTHER
PERSON (A) TO MAKE ANY STATEMENTS WITH RESPECT TO THE OFFER, OTHER THAN
THE STATEMENTS SPECIFICALLY SET FORTH IN THE OFFER TO PURCHASE AND THE
LETTER OF TRANSMITTAL, OR (B) TO DISTRIBUTE ANY MATERIAL WITH RESPECT TO
THE OFFER (INCLUDING, WITHOUT LIMITATION, THESE QUESTIONS AND ANSWERS)
OTHER THAN AS SPECIFICALLY AUTHORIZED BY THE FUND.
<PAGE>
NOT FOR DISTRIBUTION TO STOCKHOLDERS OR OTHERS
FOR USE ONLY BY ELIGIBLE INSTITUTIONS AND BY THE DEPOSITARY
1.Q. What is the tender offer?
A. Alliance World Dollar Government Fund, Inc. (the "Fund") has commenced
an offer to purchase 1,297,906 of its shares of common stock for cash
at a price per share equal to the per share net asset value as of the
close of the regular trading session of the New York Stock Exchange on
January 8, 1998, unless extended, upon specified terms and subject to
conditions as set forth in the tender offer documents.
2.Q. When does the tender offer expire?
A. The tender offer is to expire at 12:00 Midnight Eastern Time on January
8, 1998, unless extended by the Fund.
3.Q. Why is the Fund making this tender offer?
A. The tender offer is being made to fulfill an undertaking made by the
Fund in connection with the initial public offering of shares of the
Fund's common stock in 1992.
4.Q. How do I tender my shares?
A. If your shares are registered in your name, you should obtain a package
of the tender offer materials, including the Offer to Purchase dated
December 10, 1997 and the related Letter of Transmittal, read them, and
if you should decide to tender, complete a Letter of Transmittal and
submit any other documents required by the Letter of Transmittal. These
materials must be received by BankBoston, N.A., the Depositary, in
proper form before 12:00 Midnight Eastern Time on January 8, 1998,
unless the tender offer is extended by the Fund. However, if your
shares are held by a broker, dealer, commercial bank, trust company or
other nominee (e.g., in "street name"), you should contact that firm to
obtain the package of information necessary to make your decision and
you can only tender your shares by directing that firm to complete,
compile and deliver the necessary documents for submission to the
Depositary.
5.Q. Is there any cost to me to tender?
A. There is a $25.00 processing fee (the "Processing Fee") per tendering
stockholder. Your tender will not be a proper one if a check payable to
BankBoston, N.A. for this fee does not accompany the documents
submitted to BankBoston, N.A. The Processing Fee will be refunded only
if no shares tendered are purchased pursuant to the offer. Your broker,
dealer, commercial bank, trust company or other nominee may charge you
additional fees according to its individual policies.
6.Q. Is the Fund required to complete the tender and purchase all shares
tendered?
A. Under most circumstances, yes. There are certain circumstances,
however, in which the Fund will not be required to accept for payment,
purchase or pay for any shares tendered as described in Section 3 of
the Offer to Purchase.
7.Q. Will this be my last opportunity to tender shares to the Fund?
A. Under the terms of the Fund's original undertaking, the Fund is
required to commence another tender offer in the first quarter of 1998
if the Fund does not purchase shares pursuant to the current offer
under the unusual circumstances referred to in the answer to Question
6. Pursuant to the undertaking, the Fund is under certain circumstances
also required to commence a tender offer in 2002, and the Board of
Directors of the Fund may, but is not required to, conduct other tender
offers. See Section 2 of the Offer to Purchase for details.
2
<PAGE>
NOT FOR DISTRIBUTION TO STOCKHOLDERS OR OTHERS
FOR USE ONLY BY ELIGIBLE INSTITUTIONS AND BY THE DEPOSITARY
8.Q. How can I obtain copies of the tender offer documents?
A. Copies of the tender offer documents, including the Offer to Purchase
and the related Letter of Transmittal, may be obtained from your broker
or bank (if your broker or bank holds your shares in its nominee (or
"street name") or from Corporate Investor Communications, Inc., the
Distribution Agent, by calling (800) 346-7885.
9.Q. Should I tender my shares?
A. Neither the Fund nor its Board of Directors nor Alliance Capital
Management L.P. (the investment adviser to the Fund) is making any
recommendation as to whether stockholders should tender or refrain from
tendering shares, and no one has been authorized to make any such
recommendation on their behalf. You should read the tender offer
materials thoroughly, and you may wish to consult your investment and
tax advisors.
10.Q. What price will I get for the shares that are tendered?
A. If shares are purchased by the Fund, you will receive the net asset
value per share as of the close of the regular trading session of the
New York Stock Exchange on the expiration date of the tender offer. The
expiration date is January 8, 1998, unless the offer is extended.
11.Q. What is the net asset value per share now?
A. On December 5, 1997, the net asset value per share was $17.29. During
the pendency of the offer, current net asset value quotations can be
obtained from BankBoston, N.A. by calling (800) 331-1710 between 9:00
a.m. and 5:00 p.m. Eastern Time, Monday through Friday (except
holidays).
12.Q. Will the net asset value be higher or lower on the date that the price
to be paid for tendered shares is to be determined?
A. No one can accurately predict the net asset value at a future date.
13.Q. Will the Fund pay interest on the purchase price of the tendered
shares?
A. No.
14.Q. When will the tender offer expire?
A. The tender offer will expire at 12:00 Midnight Eastern Time on January
8, 1998, unless it is extended. The Fund may extend the period of time
the offer is open by making a public announcement.
15.Q. May I withdraw my shares after I have tendered them?
A. Yes, you may withdraw your shares at any time prior to 5:00 P.M.
Eastern Time on January 12, 1998 (or, if the offer is extended, prior
to 5:00 P.M. Eastern Time on the second day on which the NYSE is open
for trading after the new expiration date).
16.Q. Is there any reason shares tendered would not be accepted?
A. The Fund has reserved the right to reject any and all tenders
determined by it not to be in appropriate form. Tenders will be
rejected if all shares actually and constructively (as determined under
the Internal Revenue Code) are not tendered and if the tender does not
include the Processing Fee, original signature(s) or the original of
any required signature guarantee(s). Also, the Fund may determine not
to purchase any shares under the circumstances referred to in Section 3
of the Offer to Purchase.
3
<PAGE>
NOT FOR DISTRIBUTION TO STOCKHOLDERS OR OTHERS
FOR USE ONLY BY ELIGIBLE INSTITUTIONS AND BY THE DEPOSITARY
17.Q. If shares I tender are accepted by the Fund, when will payment be
made?
A. It is contemplated, subject to change, that payment for tendered
shares, if accepted, will be made between January 13, 1998 and January
16, 1998.
18.Q. What if more than 1,297,906 shares are tendered (and not timely
withdrawn)?
A. In that event, the Fund will purchase duly tendered shares from
tendering Stockholders pursuant to the terms and conditions of the
tender offer on a pro rata basis (disregarding fractions) in accordance
with the number of shares tendered by each Stockholder (and not timely
withdrawn), unless the Fund determines not to purchase any shares.
19.Q. If all of the shares I tender are not purchased by the Fund, for any
reason, how will I get those shares back?
A. These shares will be returned to you or your broker, dealer, commercial
bank, trust company or other nominee promptly after the expiration
date, subject to any extension thereof, in accordance with the
instructions in the Letter of Transmittal.
20.Q. Can the tender offer materials be sent to me by overnight delivery
service?
A. The Depositary can send the tender offer materials to you by overnight
delivery service if you arrange in advance to pay the delivery charges.
If your shares are held in nominee (e.g., in "street name"), you should
contact your broker, dealer, commercial bank, trust company or other
nominee for a copy of the tender offer documents.
4
<PAGE>
EXHIBIT (a)(3)(iv)
FORM OF LETTER TO STOCKHOLDERS WHO HAVE
REQUESTED INFORMATION REGARDING THE OFFER BY
ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
TO PURCHASE FOR CASH 1,297,906 OF ITS ISSUED AND OUTSTANDING
SHARES AT NET ASSET VALUE PER SHARE
Dear Stockholder:
Pursuant to your request, enclosed for your consideration are the Offer to
Purchase dated December 10, 1997 of Alliance World Dollar Government Fund,
Inc. (the "Fund") and the related Letter of Transmittal pursuant to which the
Fund is offering to purchase 1,297,906 shares of its issued and outstanding
common stock, par value $0.01 per share (the "Shares"), for cash at a price
equal to their net asset value ("NAV") determined as of the close of the
regular trading session of the New York Stock Exchange ("NYSE") on January 8,
1998, upon the terms and subject to the conditions set forth in the Offer to
Purchase dated December 10, 1997 and the related Letter of Transmittal (which
together constitute the "Offer"). THE OFFER EXPIRES AT 12:00 MIDNIGHT EASTERN
TIME ON JANUARY 8, 1998, UNLESS EXTENDED (THE "EXPIRATION DATE"). If the Offer
is extended beyond January 8, 1998, the purchase price for Shares will be
their NAV determined as of the close of the regular trading session of the
NYSE on the new Expiration Date, as extended.
Neither the Fund nor its Board of Directors nor Alliance Capital Management
L.P. (the Fund's investment adviser) (the "Adviser") is making any
recommendation to any holder of Shares as to whether to tender Shares. Each
Stockholder is urged to consult the Stockholder's own investment and tax
advisors before deciding whether to tender Shares. If, after considering the
Offer to Purchase and Letter of Transmittal, you wish to tender your Shares
pursuant to the Offer, if you are the record owner of Shares, you should
follow the instructions contained in the Offer to Purchase and Letter of
Transmittal, and, if the Shares are held of record in the name of a broker,
dealer, commercial bank, trust company or other nominee, you should contact
that firm to effect the tender for you.
Your attention is called to the following:
1. Unless extended, the Offer expires at 12:00 Midnight Eastern Time on
January 8, 1998 and withdrawal rights expire at 5:00 P.M. Eastern Time on
January 12, 1998.
2. The Offer is subject to certain conditions set forth in the Offer to
Purchase. Under certain circumstances, the Fund will not be required to
accept for payment, purchase or pay for any Shares tendered, and the Fund
may also amend, extend or terminate the Offer.
3. A Stockholder wishing to accept the Offer must tender, or cause the
tender of, all Shares owned by the Stockholder and all Shares attributed to
the Stockholder for Federal income tax purposes under Section 318 of the
Internal Revenue Code of 1986, as amended, as of the date of purchase of
Shares pursuant to the Offer. Stockholders should consult their tax
advisors as to the application of the constructive ownership rules of
Section 318.
4. If more than 1,297,906 Shares are duly tendered (and not timely
withdrawn), the Fund will purchase Shares from tendering Stockholders, in
accordance with the terms and subject to the conditions specified in the
Offer to Purchase, on a pro rata basis (disregarding fractions) in
accordance with the number of Shares duly tendered by each Stockholder
during the period the Offer is open (and not timely withdrawn), unless the
Fund determines not to purchase any Shares.
5. Each tendering Stockholder is required to submit a check in the amount
of $25.00 payable to BankBoston, N.A. (the "Depositary") as a processing
fee to help defray the cost associated with effecting the Offer. A broker,
dealer, commercial bank, trust company or other nominee may also charge a
fee for processing transactions on behalf of a Stockholder. Tendering
Stockholders are not obligated to pay brokerage commissions or, subject to
Instruction 6 of the Letter of Transmittal, transfer taxes on the purchase
of Shares by the Fund pursuant to the Offer.
The Offer is not being made to (nor will tenders be accepted from or on
behalf of) holders of Shares in any jurisdiction in which the Offer or its
acceptance would violate the laws of such jurisdiction. In any jurisdiction
where the securities, blue sky or other laws require the Offer to be made by a
licensed broker or dealer, the Offer shall be deemed to be made on behalf of
the Fund by one or more registered brokers or dealers licensed under the laws
of that jurisdiction.
Should you have any other questions concerning the enclosed material, please
contact your broker, dealer, commercial bank, trust company or other nominee,
or call the Depositary at the number indicated in the Offer to Purchase.
Very truly yours,
Alliance World Dollar Government
Fund, Inc.
<PAGE>
EXHIBIT (a)(4)
News Release Alliance Capital
FOR IMMEDIATE RELEASE
Shareholder Contact:
1-800-219-4218
Media Contact Only:
Duff Ferguson
212-969-1056
ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
ANNOUNCES COMMENCEMENT OF TENDER OFFER
------------------------------------------
NEW YORK, NY December 9, 1997 -- Alliance World
Dollar Government Fund, Inc. (NYSE: AWG) (the "Fund")
announced today that the Fund will commence a tender offer
on December 10, 1997 for 1,297,906 shares of its common
stock representing approximately 15% of the Fund's
outstanding shares. The offer is for cash at a price equal
to the net asset value per share determined as of the close
of the regular trading session of the New York Stock
Exchange on the date the offer expires. On December 5, 1997,
the net asset value of a share of the Fund was $17.29 per
share and the per share market price on the NYSE was $16.68
representing a 3.48% discount from net asset value. The
offer will expire at 12:00 Midnight Eastern Time on January
8, 1998, unless extended. The offer is in fulfillment of an
undertaking regarding the possibility of a tender offer to
commence in 1997 disclosed in the prospectus for the Fund's
initial public offering in October 1992.
The terms and conditions of the offer are set forth
in the Fund's Offer to Purchase dated December 10, 1997 and
the related Letter of Transmittal. A copy of these documents
may be obtained from, and questions and requests for
assistance should be directed to, the Depositary,
BankBoston, N.A., Corporate Reorganization, P.O. Box 9061,
Boston, Massachusetts 02205-8686, or by calling (800) 331-
1710.
The Fund is a non-diversified, closed-end U.S.
registered management investment company whose investment
adviser is Alliance Capital Management L.P. The Fund has
current net assets of approximately $149.6 million and seeks
high current income from investment in debt obligations
<PAGE>
denominated in U.S. dollars of countries with emerging
economies whose recent interest rates are higher than those
of the United States.
This announcement is not an offer to purchase or
solicitation of an offer to sell shares of the Fund. The
offer is Alliance Capital Management L.P., 1345 Avenue of
the Americas, New York, N.Y. 10105 made only by the Offer to
Purchase and the related Letter of Transmittal. The offer is
not being made to, nor will tenders be accepted from or on
behalf of, holders of shares in any jurisdiction in which
making or accepting the offer would violate that
jurisdiction's laws.
2
<PAGE>
EXHIBIT (c)(1)
DEPOSITARY AGREEMENT
--------------------
This Depositary Agreement is entered into as of this 10th day of December
by and between Alliance World Dollar Government Fund, Inc., a Maryland
Corporation (the "Company") and BankBoston, N.A., a national banking association
with its principal offices in Boston, Massachusetts (hereinafter referred to
from time to time as the "Depositary").
WHEREAS, the Company is making a tender offer (hereinafter referred to,
together with any amendment or extensions thereto, as the "Tender Offer") to
purchase 1,297,906 outstanding shares of the Company's Common Stock, par value
$0.01 per share (the "Shares"), upon the terms and subject to the conditions set
forth in the Offer to Purchase, dated December 10, 1997 (the "Offer to
Purchase"), and in the related Letter of Transmittal ("Letter of Transmittal"),
including the instructions set forth therein.
WHEREAS, the Tender Offer is being commenced on December 10, 1997, and will
expire at 12:00 Midnight Eastern time on January 8, 1998, unless extended by the
Company as provided in the Offer to Purchase (the last date to which the Tender
Offer is extended and on which it expires is herein referred to as the
"Expiration Date").
WHEREAS, the Company desires that BankBoston, N.A. act as depositary in
connection with the Tender Offer, and BankBoston, N.A. has indicated its
willingness to do so.
NOW, THEREFORE, in consideration of the mutual covenants contained herein,
the parties hereto agree as follows:
1. Appointment of Depositary.
-------------------------
The Company hereby appoints the Depositary to act as such in connection
with the Tender offer. In that capacity the Depositary will receive and make
payment for, on behalf of the Company, Shares tendered pursuant to the terms of
the Tender offer. The Depositary hereby agrees to serve as such, upon the terms
and conditions set forth herein. In connection with such appointment, the
Company has delivered to the Depositary a copy of the Offer to Purchase and the
Letter of Transmittal in connection with the Tender Offer. The Company
<PAGE>
agrees to notify the Depositary of, and confirm in writing, any extension or
amendment of the Tender Offer.
2. Concerning the Depositary.
-------------------------
The Depositary is hereby authorized and directed, and hereby agrees to the
following:
(a) The Depositary shall examine the Letters of Transmittal, the
certificates for Shares and the other documents delivered or mailed to the
Depositary in connection with tenders of Shares to ascertain whether they are
completed and executed in accordance with the instructions set forth in the
Letters of Transmittal. In the event any Letter of Transmittal has been
improperly completed or executed, or the certificates for Shares accompanying
such Letter of Transmittal are not in proper form for transfer (as required by
the aforesaid instructions), or if some other irregularity in connection with
any tender of Shares exists, the Depositary shall forward the defective item
back to the shareholder to be corrected. Determination of all questions as to
the validity, form, eligibility (including timeliness of receipt) and acceptance
of any Shares tendered or delivered shall be determined by the Depositary on
behalf of the Company in the first instance, but final decisions on all such
matters shall be made by the Company. The Company will reserve in the Tender
Offer the absolute right to reject any or all tenders of any particular Shares
not in appropriate form or the acceptance of which would, in the opinion of the
Company's counsel, be unlawful and to waive any of the conditions of the Tender
Offer or any defect or irregularity in the tender of any Shares, and the
Company's interpretation of the terms and conditions of the Tender Offer will be
final.
(b) All Shares must be tendered in accordance with the terms and
conditions set forth in the Tender Offer. Payment for Shares tendered and
purchased pursuant to the Tender Offer shall be made only after deposit with the
Depositary of the certificates therefor, the Letter of Transmittal and any other
required documents.
(c) A tendering stockholder may withdraw Shares tendered, as set forth in
the Tender Offer, in which event the Depositary shall, as promptly as possible
after notification of
2
<PAGE>
such withdrawal, return such Shares to, or in accordance with the instruction
of, such stockholder and such Shares shall no longer be considered properly
tendered. All questions as to the form and validity of notices of withdrawal,
including timeliness of receipt, shall be determined by the Company, whose
determination shall be final and binding.
(d) On each business day up to and including the Expiration Date (as
defined in the Tender Offer), the Depositary shall advise by facsimile
transmission, to Edmund P. Bergan, Jr., Mark Gersten, and such other persons as
either of them may direct, of the number of Shares which have been duly tendered
on such day, stating separately the number of Shares tendered by Notices of
Guaranteed Delivery, the number of Shares tendered about which the Depositary
has questions concerning validity, and the cumulative number of Shares tendered
through the time of such facsimile transmission. The Depositary shall also
inform the aforementioned persons, and such other persons as may be designated,
upon request made from time to time, of such other information as he/she may
request, including, without limitation, the names and addresses of registered
holders of tendered Shares.
(e) The Depositary shall stamp as to the date and time of receipt all
Letters of Transmittal or facsimile transmissions submitted in lieu thereof, and
preserve such records in accordance with the Securities Exchange Act of 1934, as
amended, and other applicable law. The Depositary shall match Notices of
Guaranteed delivery submitted pursuant to the Tender Offer with the Share(s)
tendered pursuant thereto. If so instructed by the Company, the Depositary
shall telephone Eligible Institutions (as defined in the Offer to Purchase)
which have tendered a significant number of Shares by means of the
aforementioned procedures to ascertain information in connection therewith.
(f) The Depositary shall follow and act upon any amendments, modifications
or supplements to these instructions and upon any further instructions in
connection with the Tender Offer, any of which may be given to the Depositary by
the Company or such other persons as it may authorize.
3
<PAGE>
(g) If, pursuant to the Offer to Purchase, the Company instructs the
Depositary not to accept the instructions and/or Shares received from a
tendering stockholder, the Depositary shall return the certificates for such
Shares to, or in accordance with the instructions of, the persons who deposited
the same, together with a letter of notice, in form satisfactory to the Company,
explaining why the deposited Shares are being returned, and return to the
Company any surplus funds deposited by the Company with the Depositary.
(h) In addition to the services the Depositary is to perform as provided
for herein, the Depositary shall perform as Depositary such other services as
are required or contemplated to be performed by the Depositary under the Tender
Offer documents, including, but not limited to, making proration computations,
returning to stockholders Shares tendered but not accepted for purchase and
responding to requests for information and documents.
(i) The Depositary:
(1) shall have no obligation to make payment for any tendered Shares
unless the Company shall have provided the necessary funds to pay in full all
amounts due and payable with respect thereto;
(2) shall have no duties or obligations other than those
specifically set forth herein or as may subsequently be requested of the
Depositary by the Company with respect to the Tender Offer;
(3) will be regarded as making no representations and having no
responsibilities as to the validity, sufficiency, value or genuineness of any
stock certificates or the Shares represented thereby deposited with the
Depositary pursuant to the Tender Offer and will not be required and will make
no representations as to the validity, value or genuineness of the Tender Offer;
(4) may rely on and shall be protected in acting upon any
certificate, instrument, opinion, notice, letter, facsimile transmission,
telegram or other document, or any
4
<PAGE>
security delivered to it, and reasonably believed by it to be genuine and to
have been signed by the proper party or parties;
(5) may rely on and shall be protected in acting upon written or oral
instructions from the Company with respect to any matter relating to its acting
as Depositary specifically covered by this Depositary Agreement;
(6) may consult with counsel satisfactory to it (including counsel for the
Company) and the written advice or opinion of such counsel shall be full and
complete authorization and protection in respect of any action taken, suffered
or omitted by it hereunder in good faith and in accordance with such advice or
opinion of such counsel;
(7) shall arrange for insurance protecting the Company and itself against
any liability arising out of the non-receipt by shareholders of certificates
sent by the Depositary; and
(8) shall not at any time advise any person as to the wisdom of making any
tender pursuant to the Tender Offer, the value of the Shares or as to any other
financial or legal aspect of the Tender Offer or any transaction related
thereto.
5
<PAGE>
3. Deposits.
--------
(a) The Company will from time to time deposit or cause to be deposited
with the Depositary, as Depositary and agent for tendering holders of Shares,
within a reasonable time after the Company's acceptance for purchase of tendered
Shares, an amount equal to the aggregate purchase price of all Shares to be
purchased which the Depositary then holds. The Company will deposit with the
Depositary or cause to be deposited with the Depositary an amount equal to the
total stock transfer taxes, if any, payable by the Company pursuant to the
instructions to the Letter of Transmittal in respect of the transfer of all the
Shares to be purchased which the Depositary holds. The Depositary shall
thereupon, as promptly as possible, (a) purchase and affix appropriate stock
transfer tax stamps, (b) cause the tendered Shares which have been thus paid for
to be transferred and delivered to the Company, and (c) send a check for the
purchase price (less the amount, if any, of any stock transfer taxes and, if
applicable, adjusted in accordance with the provisions of the Tender Offer ) of
the Shares purchased to, or otherwise in accordance with instructions of, each
of the stockholders who has tendered Shares.
(b) It is understood and agreed that the securities, money, assets or
property (the "Property") to be deposited with or received by the Depositary
from the Company shall be held solely for the benefit of the Company and
stockholders tendering Shares, as their interests may appear. The Depositary
hereby waives any and all rights of lien, attachment or set-off whatever, if
any, against the Property so to be deposited, whether such rights arise by
reason of statutory or common law, by contract or otherwise.
4. Compensation of the Depositary by the Company.
---------------------------------------------
6
<PAGE>
The Company shall pay fees for the services rendered hereunder, as set
forth in the attached Fee and Service Schedule. The Depositary shall also be
entitled to reimbursement from the Company for all reasonable and necessary
expenses paid or incurred by it in connection with the administration by the
Depositary of its duties hereunder.
5. Indemnification.
---------------
The Company covenants and agrees to indemnify and to hold the Depositary
harmless against any costs, expenses (including reasonable fees of its legal
counsel), losses or damages, which may be paid, incurred or suffered by or to
which it may become subject, arising from or out of, directly or indirectly, any
claims or liability resulting from its actions as Depositary pursuant hereto;
provided, that such covenant and agreement does not extend to, and the
Depositary shall not be indemnified with respect to, such costs, expenses,
losses and damages incurred or suffered by the Depositary as a result of, or
arising out of, its negligence, bad faith, or willful misconduct or
willful failure to perform any of the Depositary's obligations hereunder. In no
case will the Company be liable under this indemnity with respect to any claim
against the Depositary unless, promptly after the receipt by the Depositary of
notice of any assertion of demand or claim or the commencement of any action,
suit, proceeding or investigation, or of the service of any summons on the
Depositary, or other first legal process giving information as to the nature
and basis of the claim, the Depositary shall, if a claim in respect thereof is
to be made against the Company, notify the Company thereof in writing. The
Company shall be entitled to participate at its own expense in the defense of
any such claim or proceeding, and, if the Company so elects at any time after
receipt of such notice, it may assume the defense of any suit brought to enforce
any such claim or of any other legal action or proceeding. In the event the
Company assumes the defense of any such suit, the Company may select counsel of
its own choosing for such purpose, and the Company will not be liable for the
fees and expenses of any additional counsel retained by you. For the purposes
hereof, the term
7
<PAGE>
"expense or loss" means any amount paid or payable to satisfy
any claim, demand, action, suit or proceeding settled with the express written
consent of the Depositary, and the Company, and all reasonable costs and
expenses, including, but not limited to, reasonable counsel fees and
disbursements, paid or incurred in investigating or defending against any such
claim, demand, action, suit, proceeding or investigation.
6. Further Assurance.
-----------------
From time-to-time and after the date hereof, the Company shall deliver or
cause to be delivered to the Depositary such further documents and instruments
and shall do and cause to be done such further acts as the Depositary shall
reasonably request (it being understood that the Depositary shall have no
obligation to make any such request) to carry out more effectively the
provisions and purposes of this Depositary Agreement, to evidence compliance
herewith or to assure itself that it is protected in acting hereunder.
7. Term.
----
This Agreement shall remain in effect until terminated on February 15,
1998 (the "Termination Date") or, prior to the Termination Date, upon 30 days'
written notice by either party to the other.
8. Notices.
-------
Until further notice in writing by either party hereto to the other party,
all written reports, notices and other communications between the Depositary and
the Company required or permitted hereunder shall be delivered or mailed by
first class mail, postage prepaid, addressed as follows:
8
<PAGE>
If to the Company, to:
Alliance World Dollar Government Fund, Inc.
c/o Alliance Capital Management L.P.
1345 Avenue of the Americas
N.Y., N.Y 10105
Attn: Andrew L. Gangolf, Esq.
If to the Depositary, to:
BankBoston, N.A.
c/o Boston EquiServe Limited Partnership
150 Royall Street
Canton, MA 02021
Attn: Reorganization Department
9. Governing Law.
This Depositary Agreement shall be governed by and construed in accordance
with the laws of The Commonwealth of Massachusetts and shall inure to the
benefit of and the obligations created hereby shall be binding upon the
successors and assigns of the parties hereto.
10. Counterparts.
This Depositary Agreement may be executed in separate counterparts, each of
which when executed and delivered shall be an original, but all such
counterparts shall together constitute but one and the same instrument.
9
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Depositary Agreement to
be executed by their respective officers, hereunto duly authorized, as of the
day and year first above written.
ALLIANCE WORLD DOLLAR BANKBOSTON, N.A.
GOVERNMENT INCOME FUND, INC.
By: /s/ Edmund P. Bergan, Jr. By: /s/ Barbara S. Cummings
__________________________ __________________________
Edmund P. Bergan, Jr. Barbara S. Cummings
Title: Secretary Title: Administration Manager
10
<PAGE>
ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC.
EXHIBIT A
FEE SCHEDULE
Administrative Fee $5,000.00
Midnight Expiration Fee $2,500.00
Letter of Transmittal $7.50 per Letter of Transmittal
Processed Per Registered or
Beneficial Owner
Withdrawal, Defects or $10.00 per item
Guarantees Of Delivery
Per Extension of Offer $1,500.00
Items not included:
All out-of-pocket expenses such as telephone line charges associated with
toll-free telephone calls, requests for and distribution of materials,
overprinting, cost of checks, postage, insurance, stationery, wire transfers,
excess material disposal, etc. will be billed as incurred.
A-1
<PAGE>
EXHIBIT (c)(2)
ADVISORY AGREEMENT
Alliance World Dollar Government Fund, Inc.
1345 Avenue Of The Americas
New York, New York 10105
October 29, 1992
Alliance Capital Management L.P.
1345 Avenue of the Americas
New York, New York 10105
Dear Sirs:
We, the undersigned Alliance World Dollar
Government Fund, Inc., herewith confirm our agreement with
you as follows:
1. We are a closed-end, non-diversified
management investment company registered under the
Investment Company Act of 1940 (the "Act"). We propose to
engage in the business of investing and reinvesting our
assets in securities ("the portfolio assets") of the type
and in accordance with the limitations specified in our
Articles of Incorporation, Bylaws, Registration Statement
filed with the Securities and Exchange Commission under the
Securities Act of 1933 and the Act, and any representations
made in our prospectus, all in such manner and to such
extent as may from time to time be authorized by our Board
of Directors. We enclose copies of the documents listed
above and will from time to time furnish you with any
amendments thereof.
<PAGE>
2. (a) We hereby employ you to manage the
investment and reinvestment of the portfolio assets as above
specified and, without limiting the generality of the
foregoing, to provide management and other services
specified below.
(b) You will make decisions with respect to all
purchases and sales of the portfolio assets. To carry out
such decisions, you are hereby authorized, as our agent and
attorney-in-fact, for our account and at our risk and in our
name, to place orders for the investment and reinvestment of
the portfolio assets. In all purchases, sales and other
transactions in the portfolio assets you are authorized to
exercise full discretion and act for us in the same manner
and with the same force and effect as we might or could do
with respect to such purchases, sales or other transactions,
as well as with respect to all other things necessary or
incidental to the furtherance or conduct of such purchases,
sales or other transactions.
(c) You will report to our Board of Directors at
each meeting thereof all changes in the portfolio assets
since the prior report, and will also keep us in touch with
important developments affecting the portfolio assets and on
your own initiative will furnish us from time to time with
such information as you may believe appropriate for this
2
<PAGE>
purpose, whether concerning the individual issuers whose
securities are included in our portfolio, the industries in
which they engage, or the conditions prevailing in the
economy generally. You will also furnish us with such
statistical and analytical information with respect to the
portfolio assets as you may believe appropriate or as we
reasonably may request. In making such purchases and sales
of the portfolio assets, you will bear in mind the policies
set from time to time by our Board of Directors as well as
the limitations imposed by our Articles of Incorporation and
in our Registration Statement under the Act and the
Securities Act of 1933, the limitations in the Act and of
the Internal Revenue Code of 1986, as amended, in respect of
regulated investment companies.
(d) It is understood that you will from time to
time employ or associate with yourselves such persons as you
believe to be particularly fitted to assist you in the
execution of your duties hereunder, the cost of performance
of such duties to be borne and paid by you. No obligation
may be incurred on our behalf in any such respect. During
the continuance of this agreement at our request you will
provide us persons satisfactory to our Board of Directors to
serve as our officers. Such personnel may be employees of
you or your affiliates. Nothing contained herein shall be
3
<PAGE>
construed to restrict our right to hire our own employees or
to contract for services to be performed by third parties.
Furthermore, you or your affiliates (other than us) shall
furnish us without charge with such management supervision
and assistance and such office facilities as you may believe
appropriate or as we may reasonably request subject to the
requirements of any regulatory authority to which you may be
subject.
3. We hereby confirm that, subject to the
foregoing, we shall be responsible and hereby assume the
obligation for payment of all our other expenses, including:
(a) payment of the fee payable to you under paragraph 5
hereof; (b) brokerage and commission expenses; (c) federal,
state, local and foreign taxes, including issue and transfer
taxes, incurred by or levied on us; (d) interest charges on
borrowings; (e) our organizational and offering expenses,
whether or not advanced by you; (f) fees and expenses of
registering our shares under the appropriate federal
securities laws and of qualifying our shares under
applicable state securities laws; (g) fees and expenses of
listing and maintaining the listing of our shares on any
securities exchange; (h) expenses of printing and
distributing reports to shareholders; (i) costs of proxy
solicitation; (j) charges and expenses of our administrator,
4
<PAGE>
custodians and registrar, transfer and dividend paying
agent; (k) compensation of our Directors, officers and
employees who do not devote any part of their time to your
affairs or the affairs of your affiliates other than us;
(1) legal and auditing expenses; (m) the cost of stock
certificates representing shares of our common stock; and
(n) costs of stationery and supplies.
4. We shall expect of you, and you will give us
the benefit of, your best judgment and efforts in rendering
these services to us, and we agree as an inducement to your
undertaking these services that you shall not be liable
hereunder for any mistake of judgment or in any event
whatsoever, except for lack of good faith, provided that
nothing herein shall be deemed to protect, or purport to
protect, you against any liability to us to our security
holders to which you would otherwise be subject by reason of
willful misfeasance, bad faith or gross negligence in the
performance of your duties hereunder, or by reason of your
reckless disregard of your obligations and duties hereunder.
5. In consideration of the foregoing we will pay
you a monthly fee at an annualized rate of 1.00% of our
average weekly net assets. For purposes of the calculation
of such fee, average weekly net assets shall be determined
on the basis of the average net assets of the Fund for each
5
<PAGE>
weekly period (ending on Friday) ending during the month.
The net assets for each weekly period are determined by
averaging the net assets on the Friday of such weekly period
with the net assets on the Friday of the immediately
preceding weekly period. When a Friday is not a business
day for us, then the calculation will be based on our net
assets on the business day immediately preceding such
Friday. Such fee shall be payable in arrears on the last
day of each calendar month for services performed hereunder
during such month. If our initial Registration Statement is
declared effective by the Securities and Exchange Commission
after the beginning of a month or this agreement terminates
prior to the end of a month, such fee shall be prorated
according to the proportion which such portion of the month
bears to the full month.
6. This agreement shall become effective on the
date on which our pending Registration Statement on Form N-2
relating to our shares becomes effective and shall remain in
effect until the first meeting of our shareholders held
after such date and, if approved by the vote of a majority
of the outstanding voting securities, as defined in the Act,
at such meeting, shall continue in effect until
September 30, 1994 and may be continued for successive
twelve-month periods (computed from each October 1) provided
6
<PAGE>
that such continuance is specifically approved at least
annually by our Board of Directors or by majority vote of
the holders of our outstanding voting securities (as defined
in the Act), and in either case, by a majority of our Board
of Directors who are not interested persons, as defined in
the Act, of any party to this agreement (other than as
Directors of our corporation), provided further, however,
that if the continuation of this agreement is not approved,
you may continue to render the services described herein in
the manner and to the extent permitted by the Act and the
rules and regulations thereunder. Upon the effectiveness of
this agreement, it shall supersede all previous agreements
between us covering the subject matter hereof. This
agreement may be terminated at any time, without the payment
of any penalty, by vote of a majority of our outstanding
voting securities (as so defined), or by a vote of our Board
of Directors on 60 days written notice to you, or by you on
60 days written notice to us.
7. This agreement may not be transferred,
assigned, sold or in any manner hypothecated or pledged by
you and this agreement shall terminate automatically in the
event of any such transfer, assignment, sale, hypothecation
or pledge by you. The term "transfer", "assignment" and
"sale" as used in this paragraph shall have the meanings
7
<PAGE>
ascribed hereto by governing law and any interpretation
thereof contained in rules or regulations promulgated by the
Securities and Exchange Commission thereunder.
8. (a) Except to the extent necessary to perform
your obligations hereunder, nothing herein shall be deemed
to limit or restrict your right, or the right of any of your
employees, or any of the officers or directors of Alliance
Capital Management Corporation, your general partner, who
may also be a Director, officer or employee of ours, or
persons otherwise affiliated with us (within the meaning of
the Act) to engage in any other business or to devote time
and attention to the management or other aspects of any
other business, whether of a similar or dissimilar nature,
or to render service of any kind to any other trust,
corporation, firm, individual or association.
(b) You will notify us of any change in the
general partner of your partnership within a reasonable time
after such change.
9. If you cease to act as our investment adviser,
or, in any event, if you so request in writing, we agree to
take all necessary action to change our name to a name not
including the term "Alliance". You may from time to time
make available without charge to us for our use such marks
or symbols owned by you, including marks or symbols
8
<PAGE>
containing the term "Alliance" or any variation thereof, as
you may consider appropriate. Any such marks or symbols so
made available will remain your property and you shall have
the right, upon notice in writing, to require us to cease
the use of such mark or symbol at any time.
10. This Agreement shall be construed in
accordance with the laws of the State of New York, provided,
however, that nothing herein shall be construed as being
inconsistent with the Act.
If the foregoing is in accordance with your
understanding, will you kindly so indicate by signing and
returning to us the enclosed copy hereof.
Very truly yours,
ALLIANCE WORLD DOLLAR GOVERNMENT
FUND, INC.
By /s/ David H. Dievler
------------------------
Name: David H. Dievler
Title: Chairman
Agreed to and accepted
as of the date first set forth above.
ALLIANCE CAPITAL MANAGEMENT L.P.
By ALLIANCE CAPITAL MANAGEMENT
CORPORATION,
its General Partner
By /s/ John D. Carifa
---------------------
Name: John D. Carifa
Title: President
9
<PAGE>
EXHIBIT (c)(3)
ADMINISTRATION AGREEMENT
Agreement made as of October 1, 1994, between ALLIANCE
WORLD DOLLAR GOVERNMENT FUND, INC., a Maryland corporation
(the "Fund"), and ALLIANCE CAPITAL MANAGEMENT L.P., a
Delaware limited partnership (the "Administrator").
WHEREAS, the Fund intends to operate as a closed-end
management investment company, and is so registered under
the Investment Company Act of 1940, as amended (the "1940
Act");
WHEREAS, the Fund has authorized the issuance of its
shares of common stock, par value $.01 per share (the
"Common Stock");
WHEREAS, the Fund wishes to retain the Administrator to
provide certain administrative services to the Fund under
the terms and conditions stated below, and the Administrator
is willing to provide such services for the compensation set
forth below;
NOW, THEREFORE, in consideration of the premises and
mutual covenants contained herein, the parties agree as
follows:
1. Appointment. The Fund hereby appoints the
-----------
Administrator to administer the Fund, and as such to furnish
the services set forth in paragraph 2 below and the
Administrator accepts such appointment and agrees that it
will furnish such services.
2. Services and Duties of the Administrator. Subject
----------------------------------------
to the supervision of the Fund's Board of Directors, the
Administrator will provide the following services:
(a) oversee the determination and publication
of the Fund's net asset value in
accordance with the Fund's policy as
adopted from time to time by the Board of
Directors;
(b) oversee the maintenance of the books and
records of the Fund required under Rule
31a-l(b)(4) under the Investment Company
Act;
<PAGE>
(c) arrange for bank or other borrowing by
the Fund, pursuant to the investment
adviser's determination of the lenders or
lenders, timing, amount and terms of any
such borrowing, in accordance with
authority granted by the Board of
Directors of the Fund;
(d) prepare the Fund's federal, state and
local income tax returns;
(e) prepare the financial information for the
Fund's proxy statements and quarterly,
semi-annual and annual reports to
shareholders;
(f) on the basis of the Fund's books and
records and information furnished by the
Fund or its investment adviser, prepare
the Fund's periodic financial and other
reports to the Securities and Exchange
Commission, the New York State Exchange
and other regulatory agencies or entities
as required;
(g) respond to or refer to the Fund's
officers or transfer agent, as
appropriate, shareholder inquiries
relating to the Fund;
(h) coordinate the audit examination with the
Fund's independent auditors for the
annual audit of the Fund and any required
periodic compliance examinations; and
(i) conduct asset maintenance tests and
prepare associated reports for purposes
of compliance reporting under the 1940
Act and guidelines.
All services to be furnished by the Administrator may be
furnished through the medium of any directors, officers or
employees of the Administrator. Each party shall bear all
its own expenses incurred in connection with this Agreement.
It is understood that the Administrator will from time to
time employ or associate with such persons, including one or
more of the Administrator's affiliates, as the Administrator
believes to be particularly fitted to assist the
2
<PAGE>
Administrator in the execution of its duties under this
Agreement, the cost of performance of such duties to be
borne and paid by the Administrator. No obligation may be
incurred on the Fund's behalf in any such respect.
3. Compliance with the Fund's Governing Documents and
--------------------------------------------------
Applicable Law. In all matters relating to the performance
- --------------
of this Agreement, the Administrator will act in conformity
with the Articles of Incorporation, By-Laws and Registration
Statements of the Fund and with the directions of the Fund's
Board of Directors and Fund executive officers and will
conform to and comply with the requirements of the 1940 Act
and all other applicable federal or state laws and
regulations.
4. Service Not Exclusive. Except to the extent
---------------------
necessary to perform the Administrator's obligations under
this Agreement, nothing herein shall be deemed to limit or
restrict the Administrator's right, or the right of any of
the Administrator's employees, or any of the officers or
directors of Alliance Capital Management Corporation, the
Administrator's general partner, who may also be a Director,
officer or employee of the Fund, or persons otherwise
affiliated with the Fund (within the meaning of the 1940
Act) to engage in any other business or to devote time and
attention to the management or other aspects of any other
business, whether of a similar or dissimilar nature, or to
render service of any kind to any other trust, corporation,
firm, individual or association.
5. Compensation. For the services provided and
------------
expenses assumed by the Administrator under this Agreement,
the Fund will pay the Administrator a monthly fee at an
annualized rate of .15 of 1% of the Fund's average weekly
net assets. For purposes of the calculation of such fee,
average weekly net total assets shall be determined on the
basis of the average net assets of the Fund for each weekly
period (ending on Friday) ending during the month. The net
assets for each weekly period are determined by averaging
the net assets on the Friday of such weekly period with the
net assets on the Friday of the immediately preceding weekly
period. When a Friday is not a business day for the Fund,
then the calculation will be based on the Fund's assets on
the business day immediately preceding such Friday. Such
fee shall be payable in arrears on the last day of each
calendar month for services performed hereunder during such
month. If this Agreement becomes effective after the
beginning of a month or terminates prior to the end of a
3
<PAGE>
month, such fee shall be prorated according to the
proportion which such portion of the month bears to the full
month.
6. Limitation of Liability of the Administrator. The
--------------------------------------------
Fund shall expect of the Administrator, and the
Administrator will give the Fund the benefit of, the
Administrator's best judgment and efforts in rendering these
services to the Fund, and the Fund agrees as an inducement
to the Administrator's undertaking these services that the
Administrator shall not be liable under this Agreement for
any mistake of judgment or in any event whatsoever, except
for lack of good faith, provided that nothing herein shall
be deemed to protect, or purport to protect, the
Administrator against any liability to the Fund or to the
Fund's security holders to which the Administrator would
otherwise be subject by reason of willful misfeasance, bad
faith or gross negligence in the performance of the
Administrator's duties under this Agreement, or by reason of
the Administrator's reckless disregard of the
Administrator's obligations and duties under this Agreement.
7. Assignment. This Agreement may not be transferred,
----------
assigned, sold or in any manner hypothecated or pledged by
the Administrator and this Agreement shall terminate
automatically in the event of any such transfer, assignment,
sale, hypothecation or pledge by the Administrator. The
term "transfer", "assignment" and "sale" as used in this
paragraph shall have the meanings ascribed hereto by
governing law and any interpretation thereof contained in
rules or regulations promulgated by the Securities and
Exchange Commission thereunder.
8. Duration and Termination. This Agreement shall
------------------------
become effective on the date hereof and shall continue in
effect until September 30, 1996 and may be continued for
successive twelve-month periods (computed from each October
1) provided that such continuance is specifically approved
at least annually by a vote of the Fund's Board of Directors
or by majority vote of the holders of the Fund's outstanding
voting securities (as defined in the 1940 Act), and in
either case, by the vote of a majority of the Fund's Board
of Directors who are not interested persons, as defined in
the 1940 Act, of any party to this Agreement (other than as
Directors of the Fund) cast in person at a meeting called
for the purpose of voting on such approval; provided
further, however, that if the continuation of this Agreement
is not approved, the Administrator may continue to render
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the services described herein in the manner and to the
extent permitted by the 1940 Act and the rules and
regulations thereunder. Upon the effectiveness of this
Agreement, it shall supersede all previous agreements
between the Fund and the Administrator covering the subject
matter hereof. This Agreement may be terminated at any
time, without the payment of any penalty, by a vote of a
majority of the Fund's outstanding voting securities (as so
defined), or by a vote of the Fund's Board of Directors on
60 days written notice to the Administrator, or by the
Administrator on 60 days written notice to the Fund.
9. Amendment of this Agreement. No provision of this
---------------------------
Agreement may be changed, waived, discharged or terminated
orally, but only by an instrument in writing signed by the
party against which enforcement of the change, waiver or
discharge or termination is sought.
10. Governing Law. This Agreement shall be construed
-------------
in accordance with the laws of the State of New York,
provided, however, that nothing herein shall be construed as
being inconsistent with the 1940 Act.
11. Miscellaneous. The captions of this Agreement are
-------------
included for convenience of reference only and in no way
define or delimit any of the provisions hereof or otherwise
affect their construction or effect. If any provision of
this Agreement shall be held or made invalid by a court
decision, statute, rule or otherwise, the remainder of this
Agreement shall not be affected thereby.
IN WITNESS WHEREOF, the parties hereto have caused this
instrument to be executed by their officers designated below
as of the day and year first above written.
ALLIANCE WORLD DOLLAR GOVERNMENT
FUND, INC.
By: /s/ David H. Dievler
------------------------
Name: David H. Dievler
Title: Chairman
5
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ALLIANCE CAPITAL MANAGEMENT, L.P.
By ALLIANCE CAPITAL MANAGEMENT
CORPORATION,
its General Partner
By: /s/ John D. Carifa
-------------------------
Name: John D. Carifa
Title: President
6
<PAGE>
EXHIBIT (c)(4)
ALLIANCE FUND SERVICES, INC.
SHAREHOLDER INQUIRY AGENCY AGREEMENT
AGREEMENT, dated as of November 28,1995, between
ALLIANCE WORLD DOLLAR GOVERNMENT FUND, INC., a Maryland
Corporation and a closed-end investment company registered
with the Securities and Exchange Commission (the "SEC")
under the Investment Company Act of 1940 (the "Investment
Company Act"), having its principal place of business at
1345 Avenue of Americas, New York, New York 10105 (the
"Fund"), and ALLIANCE FUND SERVICES, INC., a Delaware
corporation, having its principal place of business at 500
Plaza Drive, Secaucus, New Jersey 07094 ("Fund Services").
WHEREAS, Fund Services has agreed to act as
shareholder inquiry agent to the Fund for the purpose of
responding to telephone inquiries concerning the Fund and
matters relating thereto from Shareholders and others;
NOW THEREFORE, for and in consideration of the
mutual covenants and agreements contained herein, the
parties do hereby agree as follows:
SECTION 1. Upon the terms set forth in this
Agreement, the Fund hereby appoints Fund Services as its
shareholder inquiry agent, and Fund Services agrees to act
in that capacity. Capitalized terms used in this Agreement
and not otherwise defined shall have the meanings assigned
to them in SECTION 10.
SECTION 2.
(a) As shareholder inquiry agent hereunder, Fund
Services shall respond to telephone inquiries concerning the
Fund and matters relating thereto from Shareholders and
others.
(b) In responding to the inquiries referred to in
SECTION 2(a), Fund Services shall be limited to providing
information that is otherwise publicly available.
(c) With respect to any inquiries that Fund
Services is unable to respond to or which are beyond the
scope of its services under this Agreement, to the extent
reasonable under the circumstances, Fund Services shall
direct such inquiries to the appropriate person.
<PAGE>
SECTION 3. The Fund shall provide Fund Services
with copies of any materials relating to the Fund that are
reasonably requested by Fund Services for the purposes of
performing its services under this Agreement.
SECTION 4. Upon the declaration of each dividend
and each capital gains distribution by the Fund's Directors,
the Fund shall notify Fund Services of the date of such
declaration, the amount payable per Share, the record date
for determining the Shareholders entitled to payment, the
payment and the reinvestment date price.
SECTION 5. Nothing contained in this Agreement is
intended to or shall require Fund Services to perform any
functions or duties on any day other than a Business Day.
Functions or duties normally scheduled to be performed on
any day which is not a Business Day shall be performed on,
and as of, the next Business Day, unless otherwise required
by law.
SECTION 6. For the services rendered by Fund
Services as described above, the Fund shall pay to Fund
Services a fee at a rate to be mutually agreed upon from
time to time, provided that in no event shall the fee be
more than the cost to Fund Services of providing such
services.
SECTION 7. Fund Services shall not be liable for
any taxes, assessments or governmental charges that may be
levied or assessed on any basis whatsoever in connection
with the Fund or any Shareholder, excluding taxes assessed
against Fund Services for compensation received by it
hereunder.
SECTION 8.
(a) Fund Services shall at all times act in good
faith and with reasonable care in performing the services to
be provided by it under this Agreement, but shall not be
liable for any loss or damage unless such loss or damage is
caused by the negligence, bad faith or willful misconduct of
Fund Services or its employees or agents.
(b) Without limiting the foregoing:
(i) Fund Services may rely upon the
statements and instructions of Fund officers and advice of
the Fund or counsel to the Fund or Fund Services. Fund
2
<PAGE>
Services shall not be liable for any action taken in good
faith reliance upon such instructions or advice;
(ii) Fund Services shall not be liable for
any action reasonably taken in good faith reliance upon any
such instructions or advice or upon a certified copy of any
resolution of the Fund's Directors. Fund Services may rely
upon the genuineness of any document, or copy thereof,
reasonably believed by Fund Services in good faith to have
been validly executed;
(iii) Fund Services may rely, and shall be
protected by the Fund in acting, upon any signature,
instruction, request, opinion of counsel, statement, report,
notice or other document reasonably believed by it in good
faith to be genuine and to have been duly signed or
presented on behalf of the Fund.
(c) The Fund shall indemnify Fund Services and
hold it harmless from any and all losses, costs, damages,
liabilities and expenses, including reasonable expenses of
counsel, incurred by it resulting from any claim, demand,
action or suit in connection with the performance of its
duties hereunder, including any error, omission, inaccuracy
or other deficiency contained in materials provided to Fund
Services by the Fund, or as a result of acting upon any
instruction reasonably believed by it to have been properly
given by a duly authorized officer of the Fund, or out of
the failure of the Fund to provide any information in the
Fund's possession needed by Fund Services to knowledgeably
perform its functions; provided the Fund shall have no
obligation to indemnify Fund Services or hold it harmless
with respect to any expenses, damages, claims, suits,
liabilities, actions, demands or losses caused directly or
indirectly by acts or omissions of Fund Services, and
provided that this indemnification shall not apply to
actions or omissions of Fund Services in cases of its own
bad faith, willful misconduct or negligence, and provided
further that if in any case the Fund may be asked to
indemnify or hold Fund Services harmless pursuant to this
Section, the Fund shall have been fully and promptly advised
by Fund Services of all material facts concerning the
situation in question. The Fund shall have the option to
defend Fund Services against any claim which may be the
subject of this indemnification, and in the event that the
Fund so elects, it will so notify Fund Services, and
thereupon the Fund shall retain competent counsel to
undertake defense of the claim, and Fund Services shall in
3
<PAGE>
such situations incur no further legal or other expenses for
which it may seek indemnification under this Section.
SECTION 9. This Agreement may be amended from time
to time by a written supplemental agreement executed by the
Fund and Fund Services and without notice to or approval of
the Shareholders; provided this Agreement may not be amended
in any manner which would substantially increase the Fund's
obligations hereunder unless the amendment is first approved
by the Fund's Directors, including a majority of the
Directors who are not a party to this Agreement or
interested persons of any such party, at a meeting called
for such purpose, and thereafter is approved by the
Shareholders if such approval is required under the
Investment Company Act or the rules and regulations
thereunder. The parties hereto may adopt procedures as may
be appropriate or practical under the circumstances, and
Fund Services may conclusively rely on the determination of
the Fund that any procedure that has been approved by the
Fund does not conflict with or violate any requirement of
its Articles of Incorporation or By-Laws, or any rule,
regulation or requirement of any regulatory body.
SECTION 10. The terms, as defined in this Section,
whenever used in this Agreement or in any amendment or
supplement hereto, shall have the meanings specified below,
insofar as the context will allow.
(a) Business Day: The term Business Day shall mean
any day on which the Fund is open for business as described
in its Prospectus.
(b) Shareholders: The term Shareholders shall mean
the registered owners from time to time of the Shares, as
reflected on the stock registry records of the Fund.
(c) Shares: The term Shares shall mean all or any
part of each class of the shares of capital stock of the
Fund which from time to time are authorized and/or issued by
the Fund.
SECTION 11. Fund Services shall not be liable for
any delays or errors occurring by reason of circumstances
beyond its control, including but not limited to acts of
civil or military authorities, national emergencies, fire,
flood or catastrophe, acts of God, insurrection, war, riot,
or failure of transportation, communication or power supply,
except to the extent that Fund Services shall have failed to
4
<PAGE>
use its best efforts to minimize the likelihood of
occurrence of such circumstances or to mitigate any loss or
damage to the Fund caused by such circumstances.
SECTION 12. The Fund may give Fund Services sixty
(60) days and Fund Services may give the Fund ninety (90)
days written notice of the termination of this Agreement,
such termination to take effect at the time specified in the
notice. Upon notice of termination, the Fund may, but is
not required to, appoint a successor shareholder inquiry
agent. Upon receipt from the Fund of written notice of the
appointment of the successor shareholder inquiry agent and
related instructions, Fund Services shall, upon request of
the Fund and the successor shareholder inquiry agent and
upon payment of Fund Services' reasonable charges and
disbursements, promptly transfer to the successor
shareholder inquiry agent all materials held by Fund
Services hereunder and cooperate with, and provide
reasonable assistance to, the successor shareholder inquiry
agent in the transition to carry out its responsibilities
hereunder.
SECTION 13. Any notice or other communication
required by or permitted to be given in connection with this
Agreement shall be in writing, and shall be delivered in
person or sent by first-class mail, postage prepaid, to the
respective parties.
Notice to the Fund shall be given as follows until
further notice:
Alliance World Dollar Government Fund, Inc.
1345 Avenue of the Americas
New York, New York 10105
Attention: Secretary
Notice to Fund Services shall be given as follows
until further notice:
Alliance Fund Services, Inc.
500 Plaza Drive
Secaucus, New Jersey 07094
SECTION 14. The Fund represents and warrants to
Fund Services that the execution and delivery of this
Agreement by the undersigned officer of the Fund has been
duly and validly authorized by resolution of the Fund's
Directors. Fund Services represents and warrants to the
5
<PAGE>
Fund that the execution and delivery of this Agreement by
the undersigned officer of Fund Services has also been duly
and validly authorized.
SECTION 15. This Agreement may be executed in more
than one counterpart, each of which shall be deemed to be an
original, and shall become effective as of November 28,
1995, unless otherwise agreed by the parties. Unless sooner
terminated pursuant to SECTION 12, this Agreement will
continue until September 30, 1996 and will continue in
effect thereafter for successive 12 month periods only if
such continuance is specifically approved at least annually
by the Directors or by a vote of the Shareholders and in
either case by a majority of the Directors who are not
parties to this Agreement or interested persons of any such
party, at a meeting called for the purpose of voting on this
Agreement.
SECTION 16. This Agreement shall extend to and
shall bind the parties hereto and their respective
successors and assigns; provided, however, that this
Agreement shall not be assignable by the Fund without the
written consent of Fund Services or by Fund Services without
the written consent of the Fund, authorized or approved by a
resolution of the Fund's Directors. Notwithstanding the
foregoing, either party may assign this Agreement without
the consent of the other party so long as the assignee is an
affiliate, parent or subsidiary of the assigning party and
is qualified to act under the Investment Company Act, as
amended from time to time.
SECTION 17. This Agreement shall be governed by
the laws of the state of New York.
WITNESS the following signatures:
Alliance World Dollar
Government Fund, Inc.
By: /s/ Edmund P. Bergan, Jr.
--------------------------
Title: Secretary
6
<PAGE>
ALLIANCE FUND SERVICES, INC.
By: /s/ George Hrabovsky
----------------------------
Title: President
7
