<PAGE> 1
SALOMON BROTHERS
WORLDWIDE INCOME FUND INC
SEMI-ANNUAL REPORT
APRIL 30, 1996
---------------------------------------
SALOMON BROTHERS ASSET MANAGEMENT
-----------------------------------
<PAGE> 2
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
June 28, 1996
Dear Shareholders:
We are pleased to provide this semi-annual report for the Salomon Brothers
Worldwide Income Fund Inc (the "Fund"), including market commentary and a
statement of the Fund's current investments.
During the fiscal quarter ended April 30, 1996, the net asset value of the Fund
decreased from $13.64 per share at January 31, 1996 to $13.11 per share at April
30, 1996. Dividends of $0.35625 per share were declared during the quarter.
Assuming that these dividends were reinvested in additional shares of the Fund,
the net asset value return for the quarter ended April 30, 1996 was negative
1.16%. During the same period, the Salomon Brothers Brady Bond Index, which we
use as a measure of the return of the overall market for emerging markets debt,
returned 0.66%.
Investments in securities of emerging markets issues, including both obligations
of sovereign governments and corporate issuers, totaled approximately 88% of
total investments at the end of the quarter. The remainder of the Fund's
long-term portfolio assets was invested in U.S. high-yield corporate bonds.
EMERGING MARKETS
After a difficult start, emerging markets turned in a strong performance in the
quarter ended April 30. In March and early April, uncertainty about U.S.
interest rates rattled domestic and foreign debt markets. By the end of the
period, however, U.S. rates moved into a trading range and individual country
fundamentals began to have a dominant impact on performance. Three positive
developments --Venezuela's agreement with the International Monetary Fund,
Standard & Poor's two-notch upgrade of Poland's debt to investment grade and
Mexico's Brady Bond swap offering -- set the stage for the market's upswing in
April.
HIGH-YIELD MARKET
The high-yield market declined in absolute terms in the quarter ended April 30,
but these bonds outpaced U.S. Treasuries in each of the past three months. The
spread between Treasuries and the Salomon Brothers High-Yield Market Index
narrowed to 376 basis points from 435 basis points over the three-month period.
The average market yield finished the quarter at 10.15%, marking the first time
this year that yields were in the double digits.
The market's modestly negative performance had little impact on either mutual
fund inflows or new issues of high-yield bonds, both of which remained strong.
One sector of the market that outperformed the high-yield market index was
junior subordinate bonds. This sector of the market is not highly correlated
with the Treasury market. Sectors of the market that underperformed included BB
and BBB/BB bonds.
<PAGE> 3
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
DIVIDEND REINVESTMENT PLAN
The Board of Directors of the Fund recently approved amendments to the Fund's
Dividend Reinvestment Plan (the "Plan"), effective September 6, 1996. The Board,
along with management of the Fund, believe that these amendments are in the best
interests of the Fund and its shareholders.
Under the current terms of the Plan, whenever the Fund declares a distribution
from capital gains or an income dividend payable in cash, the Plan Agent,
American Stock Transfer and Trust Company, purchases additional shares on the
open-market for shareholders participating in the Plan, regardless of whether
the Fund's shares are trading at a discount or a premium to net asset value. As
amended, the Plan provides that if the Fund's shares are trading at a premium to
net asset value, Plan participants will receive newly-issued shares rather than
shares purchased on the open-market. If the Fund's shares are trading at a
discount, the Plan Agent will purchase additional shares on the open-market. If
a discount shifts to a premium or if the Plan Agent cannot complete such
purchases within the time limits set forth in the Plan, participants will
receive the uninvested portion of the dividend or distribution in newly-issued
shares. One benefit of this new structure is that in the case of a market
premium, shares will now be issued to participants at net asset value (or 95% of
the market price if the net asset value is less than 95% of the market price) as
opposed to the current structure in which shares are purchased for participants
at the higher market price.
Moreover, the Plan now provides that all shareholders who initially purchase
shares of the Fund on or after September 6, 1996 will be automatically enrolled
in the Plan. Other shareholders who have not previously enrolled in the Plan may
enroll by completing the Authorization Card attached to the Terms and Conditions
of the Plan located in the back of this Semi-Annual Report. IF YOUR SHARES ARE
HELD IN THE NAME OF A BROKER OR NOMINEE, YOU SHOULD CONTACT YOUR BROKER OR
NOMINEE FOR MORE INFORMATION ABOUT YOUR ABILITY TO PARTICIPATE IN THE PLAN.
We highly encourage those of you who are currently not participating in the Plan
to do so because the Plan offers you a prompt, simple and inexpensive way to put
your dividends and distributions to work through reinvestment in additional
shares of capital stock of the Fund. A further discussion of the benefits of
participation in the Plan is included following this letter and I encourage you
to consider the information carefully.
<PAGE> 4
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
We appreciate your continued interest in the Fund. A recorded periodic update of
the developments affecting the markets in which the Fund invests, as well as top
holdings, net asset value, performance and other information is available by
calling (800) 725-6666.
Sincerely,
/s/ MICHAEL S. HYLAND
MICHAEL S. HYLAND
Chairman and President
<PAGE> 5
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
- --------------------------------------------------------------------------------
AUTOMATIC DIVIDEND REINVESTMENT PLAN
DIVIDEND REINVESTMENT PLAN
The Automatic Dividend Reinvestment Plan (the "Plan"), administered by American
Stock Transfer and Trust Company as Plan Agent for shareholders of Salomon
Brothers Worldwide Income Fund Inc (the "Fund"), offers you a prompt, simple and
inexpensive way to put your dividends and distributions to work through
reinvestment in additional full and fractional shares of capital stock of the
Fund.
Shareholders may enroll by simply completing the enclosed Authorization Card
with the exception of those shares that are held in the name of a broker or
nominee.
Money from dividends and distributions can lie idle for months at a time;
however, with the Plan, your dividends and distributions are promptly invested
for you, automatically increasing your holdings in the Fund. All paperwork is
done for you automatically by American Stock Transfer and Trust Company, and you
will receive statements from the Plan Agent to simplify your personal records.
COST TO YOU
Except as specifically noted, you will not bear any costs of administering the
Plan. You pay only your proportionate share of the commissions paid on all
open-market purchases. Dividends and distributions, even though automatically
reinvested, continue to be taxable.
TO ENROLL
The complete Dividend Reinvestment Plan and Authorization Card can be found at
the back of this report. You must complete the Authorization Card and return it
in the envelope provided in order to participate. If you have any questions,
contact the Plan Agent at (718) 921-8200. Generally, shareholders who initially
invest on or after September 6, 1996 will be automatically enrolled in the Plan.
HOWEVER, IF YOUR SHARES ARE HELD IN THE NAME OF A BROKER OR NOMINEE, YOU SHOULD
CONTACT YOUR BROKER OR NOMINEE FOR MORE INFORMATION ABOUT YOUR ABILITY TO
PARTICIPATE IN THE PLAN.
<PAGE> 6
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS
April 30, 1996 (unaudited)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000) SOVEREIGN BONDS -- 105.1% (NOTE 2)
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ARGENTINA -- 16.4%
Peso 5,352+ Republic of Argentina, BOCON, Pre 1, 3.0817%, 4/1/01*(,)**............ $ 4,043,035
2,331 Republic of Argentina, BOCON, Pre 3, 2.8908%, 9/1/02*(,)**............ 1,477,552
US$ 28,314+ Republic of Argentina, FRB, 6.3125%, 3/31/05*......................... 21,607,121
------------
27,127,708
------------
BRAZIL -- 21.3%
49,327+ Federal Republic of Brazil, C Bond, 8.00%, 4/15/14**.................. 29,627,301
2,000 Federal Republic of Brazil, Investment (Exit) Bond, 6.00%, 9/15/13.... 1,191,250
6,500+ Federal Republic of Brazil, NMB, Series L, 6.5625%, 4/15/09*.......... 4,497,187
------------
35,315,738
------------
BULGARIA -- 7.2%
34,750+ Republic of Bulgaria, FLIRB, Series A, 2.00%, 7/28/12*................ 10,425,000
3,250 Republic of Bulgaria, IAB, 6.25%, 7/28/11*............................ 1,462,500
------------
11,887,500
------------
COSTA RICA -- 3.8%
10,000+ Costa Rica, Principal Bond, Series B, 6.25%, 5/21/15.................. 6,300,000
------------
ECUADOR -- 23.4%
89,232+ Republic of Ecuador, PDI Bond, 6.0625%, 2/28/15*(,)**................. 38,871,795
------------
HUNGARY -- 4.7%
8,000+ National Bank of Hungary, 8.875%, 11/1/13............................. 7,890,000
------------
MEXICO -- 5.4%
12,000 United Mexican States, Par Bond, Series A, 6.25%, 12/31/19............ 7,950,000
1,500 United Mexican States, Par Bond, Series B, 6.25%, 12/31/19............ 993,750
------------
8,943,750
------------
PANAMA -- 6.3%
9,000+ Republic of Panama, FRN, 6.75%, 5/10/02*.............................. 8,431,875
4,000 Republic of Panama, IRB, 3.50%, 12/29/49*(A).......................... 2,052,500
------------
10,484,375
------------
</TABLE>
- --------------------------------------------------------------------------------
See accompanying notes to financial statements.
PAGE 1
<PAGE> 7
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS (continued)
April 30, 1996 (unaudited)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000) SOVEREIGN BONDS (CONCLUDED) (NOTE 2)
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
POLAND -- 5.6%
US$ 12,201+ Republic of Poland, PDI Bond, 3.75%, 10/27/14*........................ $ 9,356,642
------------
SOUTH AFRICA -- 0.7%
ZAL 6,000 Republic of South Africa Notes, 12.00%, 2/28/05....................... 1,127,708
------------
TRINIDAD & TOBAGO -- 1.9%
US$ 3,000+ Trinidad & Tobago Notes, 9.75%, 11/3/00............................... 3,120,000
------------
URUGUAY -- 1.2%
2,500+ Uruguay, DCB, Series B, 6.4375%, 2/18/07*............................. 1,975,000
------------
VENEZUELA -- 7.2%
12,000+ Republic of Venezuela, FLIRB, Series A, 6.375%, 3/31/07*.............. 7,927,500
6,000 Republic of Venezuela, FLIRB, Series B, 6.625%, 3/31/07*.............. 3,963,750
------------
11,891,250
------------
TOTAL SOVEREIGN BONDS (cost $162,192,119)............................. 174,291,466
------------
LOAN PARTICIPATIONS++ -- 14.7%
- ------------------------------------------------------------------------------------------------------------
Republic of Jamaica,
667 Tranche A, 6.34375%, 10/15/00* (Chase Manhattan).................... 613,318
Kingdom of Morocco,
9,350+ Tranche A, 6.59375%, 1/1/09* (Merrill Lynch, J P Morgan)............ 6,732,000
14,118 Tranche B, 6.75%, 1/1/04* (Morgan Stanley, Bankers Trust)........... 11,788,240
Russia,
Bank for Foreign Economic Affairs, Vnesheconombank,
DEM 18,000 Floating Rate, 8/14/99# (Merrill Lynch, Morgan Stanley)............. 5,242,647
------------
TOTAL LOAN PARTICIPATIONS (cost $25,080,005).......................... 24,376,205
------------
</TABLE>
<TABLE>
<CAPTION>
CORPORATE BONDS -- 15.9%
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Brazil,
US$ 1,000+ Aracruz Celulose, 10.375%, 1/31/02##................................ 960,000
Canada,
C$ 3,000+ Rogers Cable Systems, 9.65%, 1/15/14................................ 1,906,336
</TABLE>
- --------------------------------------------------------------------------------
See accompanying notes to financial statements.
PAGE 2
<PAGE> 8
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS (continued)
April 30, 1996 (unaudited)
<TABLE>
<CAPTION>
PRINCIPAL
AMOUNT VALUE
(000) CORPORATE BONDS (CONCLUDED) (NOTE 2)
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Indonesia,
US$ 1,500+ Indah Kiat International Finance, 12.50%, 6/15/06................... $ 1,541,250
Mexico,
2,000+ Grupo Industrial Durango, 12.00%, 7/15/01........................... 1,960,000
United States,
2,000+ Berry Plastics Corp., 12.25%, 4/15/04............................... 2,190,000
1,000 Carr Gottstein Foods Co., 12.00%, 11/15/05.......................... 1,030,000
International Semi-Tech, Zero Coupon until 8/15/00 (11.50%
2,000 thereafter), 8/15/03.............................................. 1,200,000
Jordan Industries, Inc., Zero Coupon until 8/1/98 (11.75%
5,000+ thereafter), 8/1/05............................................... 3,350,000
Marcus Cable Co., Zero Coupon until 6/15/00 (14.25% thereafter),
1,750 12/15/05.......................................................... 1,102,500
1,000 Norcal Waste Systems, 12.50%, 11/15/05*(,)##........................ 1,047,500
2,000+ Penn Traffic Co., 9.625%, 4/15/05................................... 1,722,500
2,500+ Plastic Specialty & Technology, 11.25%, 12/1/03..................... 2,462,500
1,000 Samsonite Corp., 11.125%, 7/15/05................................... 1,015,000
1,000 Selmer Inc., 11.00%, 5/15/05........................................ 1,040,000
1,250+ Valcor Inc., 9.625%, 11/1/03........................................ 1,162,500
2,000+ Venture Holdings Trust, 9.75%, 4/1/04............................... 1,670,000
1,000 William House Regency, Inc., 13.00%, 11/15/05##..................... 1,130,000
------------
TOTAL CORPORATE BONDS (cost $27,476,538).............................. 26,490,086
------------
REPURCHASE AGREEMENT -- 3.7%
- ----------------------------------------------------------------------------------------------
State Street Bank and Trust Co., cost $6,147,000, dated 4/30/96,
$6,147,896 due 5/1/96, (collateralized by $8,095,000, 6.125%, U.S.
6,147 Treasury Notes due 5/15/98, valued at $8,327,731)................... 6,147,000
------------
TOTAL INVESTMENTS -- 139.4% (cost $220,895,662)....................... 231,304,757
------------
LIABILITIES IN EXCESS OF OTHER ASSETS -- (39.4%)...................... (65,406,034)
------------
NET ASSETS -- 100.0%
(equivalent to $13.11 per share on 12,657,133 common shares
outstanding).......................................................... $165,898,723
===========
</TABLE>
- --------------------------------------------------------------------------------
See accompanying notes to financial statements.
PAGE 3
<PAGE> 9
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
- --------------------------------------------------------------------------------
STATEMENT OF INVESTMENTS (concluded)
April 30, 1996 (unaudited)
- --------------------------------------------------------------------------------
* Rate shown reflects current rate on variable rate instrument or instrument
with step coupon rates.
** Payment-in-kind security for which all or part of the interest earned is
capitalized as additional principal.
+ All or a portion of this security is segregated as collateral pursuant to a
loan agreement.
++ Loan Participation Notes were acquired through the financial institutions
indicated parenthetically.
# Non-income producing. Security is currently in default.
## Pursuant to Rule 144A under the Securities Act of 1933, this security can
only be sold to qualified institutional investors.
(A) "When and if issued" security.
<TABLE>
<S> <C>
BOCON -- Bonos de Consolidacion.
DCB -- Debt Conversion Bond.
DEM -- Deutschemark.
FLIRB -- Front Loaded Interest Reduction Bond.
FRB -- Floating Rate Bond.
FRN -- Floating Rate Note.
IAB -- Interest in Arrears Bond.
IRB -- Interest Reduction Bond.
NMB -- New Money Bond.
PDI -- Past Due Interest.
ZAL -- South African Rand.
</TABLE>
See accompanying notes to financial statements.
PAGE 4
<PAGE> 10
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
- --------------------------------------------------------------------------------
STATEMENT OF ASSETS AND LIABILITIES
April 30, 1996 (unaudited)
<TABLE>
<S> <C>
ASSETS
Investments, at value (cost -- $220,895,662)................................................. $231,304,757
Cash......................................................................................... 534
Interest receivable.......................................................................... 3,952,770
Deferred organization expenses and other assets.............................................. 77,609
------------
Total assets......................................................................... 235,335,670
------------
LIABILITIES
Payable for investments purchased............................................................ 6,781,438
Loan payable (Note 5)........................................................................ 60,000,000
Loan interest payable (Note 5)............................................................... 1,981,772
Payable for compensated foreign currency contracts........................................... 370,546
Accrued expenses............................................................................. 163,600
Advisory fee payable......................................................................... 119,660
Administration fee payable................................................................... 19,931
------------
Total liabilities.................................................................... 69,436,947
------------
NET ASSETS
Common Stock ($.001 par value, authorized 100,000,000 shares; 12,657,133 shares
outstanding)............................................................................... 12,657
Additional paid-in capital................................................................... 176,709,696
Distributions in excess of net investment income............................................. (2,879,121)
Accumulated net realized loss on investments................................................. (18,399,414)
Net unrealized appreciation on investments and foreign currency translation.................. 10,454,905
------------
Net assets........................................................................... $165,898,723
------------
NET ASSET VALUE PER SHARE ($165,898,723 / 12,657,133 shares)................................. $ 13.11
------------
</TABLE>
- --------------------------------------------------------------------------------
See accompanying notes to financial statements.
PAGE 5
<PAGE> 11
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
- -----------------------------------------------
STATEMENT OF OPERATIONS
For the Six Months Ended April 30, 1996 (unaudited)
<TABLE>
<S> <C> <C>
NET INVESTMENT INCOME
INCOME
Interest (includes discount accretion of $4,759,868)...................... $15,950,971
EXPENSES
Investment advisory fees.................................................. $ 686,925
Administration fees....................................................... 114,488
Reports to shareholders................................................... 85,983
Custodian's fees and expenses............................................. 53,854
Audit fees and expenses................................................... 53,596
Legal fees and expenses................................................... 41,253
Transfer agent's fees and expenses........................................ 39,490
Directors' fees........................................................... 30,852
Accounting fees........................................................... 27,170
Registration fees......................................................... 12,097
Amortization of organization expenses..................................... 11,053
Miscellaneous............................................................. 22,995
----------
Total operating expenses...................................................... 1,179,756
Loan interest expense (Note 5)............................................ 2,054,271
----------
Total expenses................................................................ 3,234,027
-----------
Net investment income......................................................... 12,716,944
-----------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS AND FOREIGN CURRENCY TRANSACTIONS
Net realized gain on:
Investment transactions................................................... 1,792,807
Foreign currency transactions............................................. 46,029
-----------
1,838,836
-----------
Net change in unrealized appreciation on:
Investments............................................................... 24,737,756
Foreign currencies........................................................ 83,177
-----------
24,820,933
-----------
Net gain on investments and foreign currency transactions..................... 26,659,769
-----------
NET INCREASE IN NET ASSETS FROM OPERATIONS.................................... $39,376,713
-----------
</TABLE>
- --------------------------------------------------------------------------------
See accompanying notes to financial statements.
PAGE 6
<PAGE> 12
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
- --------------------------------------------------------------------------------
STATEMENT OF CASH FLOWS
For the Six Months Ended April 30, 1996 (unaudited)
<TABLE>
<S> <C>
INCREASE (DECREASE) IN CASH
CASH FLOWS PROVIDED BY OPERATING ACTIVITIES:
Sales of short-term portfolio investments, net........................................... $ 1,489,806
Purchases of long-term portfolio investments............................................. (82,504,542)
Proceeds from disposition of long-term portfolio investments and principal paydowns...... 85,003,463
------------
3,988,727
Net investment income.................................................................... 12,716,944
Net accretion on investments............................................................. (4,759,868)
Amortization of organization expenses.................................................... 11,053
Net change in receivables/payables related to operations................................. (3,788,853)
------------
Net cash flows provided by operating activities...................................... 8,168,003
------------
CASH FLOWS USED FOR FINANCING ACTIVITIES:
Cash dividends paid...................................................................... (10,521,203)
------------
Net cash used for financing activities............................................... (10,521,203)
------------
Net decrease in cash......................................................................... (2,353,200)
Cash at beginning of period.................................................................. 2,353,734
------------
Cash at end of period........................................................................ $ 534
------------
</TABLE>
- --------------------------------------------------------------------------------
See accompanying notes to financial statements.
PAGE 7
<PAGE> 13
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
- --------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
<TABLE>
<CAPTION>
FOR THE
SIX MONTHS
ENDED FOR THE
APRIL 30, 1996 YEAR ENDED
(UNAUDITED) OCTOBER 31, 1995
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C>
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS
Net investment income................................................. $ 12,716,944 $ 21,624,206
Net realized gain (loss) on investments and foreign currency
transactions........................................................ 1,838,836 (28,807,083)
Net change in unrealized appreciation/depreciation on investments and
foreign currencies.................................................. 24,820,933 17,573,778
------------
Net increase in net assets from operations............................ 39,376,713 10,390,901
DIVIDENDS AND DISTRIBUTIONS
Dividends from net investment income.................................. (7,112,741) (17,770,598)
Distributions in excess of net investment income...................... (1,905,478) (265,818)
------------
Total dividends and distributions..................................... (9,018,219) (18,036,416)
CAPITAL SHARE TRANSACTIONS
Net increase in net assets from initial public offering of shares..... -- 26,656+
------------
Total increase (decrease)............................................. 30,358,494 (7,618,859)
NET ASSETS
Beginning of period................................................... 135,540,229 143,159,088
------------
End of period......................................................... $165,898,723 $135,540,229
------------
</TABLE>
- --------------------------------------------------------------------------------
+ Adjustment to offering costs.
See accompanying notes to financial statements.
PAGE 8
<PAGE> 14
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
(unaudited)
NOTE 1. ORGANIZATION
The Salomon Brothers Worldwide Income Fund Inc (the "Fund") was incorporated in
Maryland on October 21, 1993 and is registered under the Investment Company Act
of 1940, as amended, as a non-diversified, closed-end management investment
company. The Fund commenced operations on December 31, 1993.
NOTE 2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently
followed by the Fund in the preparation of its financial statements.
SECURITIES VALUATION. In valuing the Fund's assets, all securities for which
market quotations are readily available are valued (except as described below)
(i) at the last sales price prior to the time of determination if there were a
sales price on the date of determination, (ii) at the mean between the last
current bid and asked prices if there were no sales price on such date and bid
and asked quotations are available and (iii) at the bid price if there were no
sales price on such date and only bid quotations are available. Publicly traded
sovereign bonds are typically traded internationally in the over-the-counter
market and will be valued at the mean between the last current bid and asked
price as of the close of business of that market. However, where the spread
between bid and asked price exceeds five percent of the par value of the
security, the security is valued at the bid price. Securities may be valued by
independent pricing services which use prices provided by market-makers or
estimates of market values obtained from yield data relating to instruments or
securities with similar characteristics. Short-term investments having a
maturity of 60 days or less are valued at amortized cost which approximates
market value. Securities for which reliable quotations are not readily available
are valued at fair value as determined in good faith by, or under procedures
established by the Board of Directors.
REPURCHASE AGREEMENTS. When entering into repurchase agreements, it is the
Fund's policy that its custodian takes possession of the underlying collateral
securities, the value of which at least equals the principal amount of the
repurchase transaction, including accrued interest. To the extent that any
repurchase transaction exceeds one business day, the value of the collateral is
marked-to-market on a daily basis to ensure the adequacy of the collateral. If
the seller defaults and the value of the collateral declines or if bankruptcy
proceedings are commenced with respect to the seller of the security,
realization of the collateral by the Fund may be delayed or limited.
PAGE 9
<PAGE> 15
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
(unaudited)
FOREIGN CURRENCY TRANSLATION. The books and records of the Fund are maintained
in U.S. dollars. Foreign currency amounts are translated into U.S. dollars on
the following basis:
(i) market value of investment securities, other assets and liabilities -- at
the 12:00 noon rate of exchange reported by Reuters;
(ii) purchases and sales of investment securities, income and expenses -- at the
rate of exchange prevailing on the respective dates of such transactions.
Although the net assets of the Fund are presented at the foreign exchange rates
and market values at the close of the period, the Fund does not isolate that
portion of the results of operations arising as a result of changes in the
foreign exchange rates from the fluctuations arising from changes in the market
prices of securities held at the end of the period. Similarly, the Fund does not
isolate the effect of changes in foreign exchange rates from the fluctuations
arising from changes in the market prices of portfolio securities sold during
the period.
Net realized losses on foreign currency transactions represent net foreign
exchange losses from disposition of foreign currency, gains or losses realized
between the trade and settlement dates on security transactions, and the
difference between amounts of interest recorded on the Fund's books and the U.S.
dollar equivalent amounts actually received. Net currency gains and losses from
valuing foreign currency denominated assets, except portfolio securities, and
liabilities at period end exchange rates are reflected as a component of
unrealized depreciation on foreign currencies.
FORWARD CURRENCY CONTRACTS. A forward currency contract ("forward contract")
is a commitment to purchase or sell a foreign currency at a future date at a
negotiated forward rate. The contracts are valued on each valuation date at
current exchange rates and any unrealized gain or loss is included in net
unrealized appreciation or depreciation on investments and foreign currencies.
The Fund records realized gains or losses on delivery of the currency or at the
time the forward contract is extinguished (compensated) by entering into a
closing transaction prior to delivery. This gain or loss, if any, is included in
net realized gain (loss) on foreign currency transactions.
CASH FLOW INFORMATION. The Fund invests in securities and distributes
dividends and distributions from net investment income and from net realized
gains which are paid in cash and may be reinvested at the discretion of
shareholders. These activities are reported in the Statement of Changes in Net
Assets and additional information on cash receipts and cash payments is
presented in the Statement of Cash Flows.
Accounting practices that do not affect reporting activities on a cash basis
include carrying investments at value and amortizing discounts or premiums on
debt obligations. For the six months ended April 30, 1996, the Fund paid
interest expense of $2,331,771.
PAGE 10
<PAGE> 16
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
(unaudited)
SECURITIES TRANSACTIONS AND INVESTMENT INCOME. Securities transactions are
recorded on the trade date. Realized gains and losses are calculated on the
identified cost basis. Interest income is recorded on the accrual basis and the
Fund accretes discount on securities purchased using the effective interest
method.
TAXES. It is the Fund's intention to continue to meet the requirements of the
Internal Revenue Code applicable to regulated investment companies and to
distribute substantially all of its taxable income and capital gains, if any, to
shareholders. Therefore, no federal income tax or excise tax provision is
required.
DIVIDENDS AND DISTRIBUTIONS. The Fund declares and pays dividends and
distributions monthly first from net investment income, then from realized
short-term capital gains and other sources, if necessary. Net long-term capital
gains, if any, in excess of loss carryforwards will be distributed annually.
Dividends and distributions are recorded on the ex-dividend date.
Income distributions and capital gain distributions are determined in accordance
with federal income tax regulations which may differ from generally accepted
accounting principles. These "book/tax" differences are either considered
temporary or permanent in nature. To the extent these differences are permanent
in nature, such amounts are reclassified within the capital accounts based on
their federal tax basis treatment; temporary differences do not require
reclassifications. Dividends and distributions which exceed net investment
income and net realized capital gains for financial reporting purposes, but not
for tax purposes are reported as distributions in excess of net investment
income and distributions in excess of net realized capital gains.
DEFERRED ORGANIZATION EXPENSES. A total of $116,182 was incurred in connection
with the organization of the Fund. These costs have been deferred and are being
amortized on a straight-line basis over a period of sixty months from the date
the Fund commenced investment operations.
NOTE 3. MANAGEMENT AND ADMINISTRATION FEES AND OTHER TRANSACTIONS
The Fund has an Investment Advisory Agreement with Salomon Brothers Asset
Management Inc (the "Adviser"), an indirect wholly-owned subsidiary of Salomon
Inc, pursuant to which the Adviser acts as the Fund's investment adviser and is
responsible for the management of the Fund's portfolio in accordance with the
Fund's investment objectives and policies and for making decisions to buy, sell,
or hold particular securities. Through August 31, 1995, the Fund also had an
Administration Agreement with Prudential Mutual Fund Management, Inc. (the
"Administrator"), pursuant to which the Administrator performed administrative
services necessary for the operation of the Fund.
PAGE 11
<PAGE> 17
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
(unaudited)
The Fund pays the Adviser a monthly fee for its advisory services at an annual
rate of .90% of the value of the Fund's average weekly net assets. The Fund paid
the Administrator a monthly fee for its administration services at an annual
rate of .15% of the value of the Fund's average weekly net assets up to $250
million and .125% of the value of such net assets in excess of $250 million.
Effective September 1, 1995, the Administration Agreement was amended to provide
for the appointment of the Adviser as Administrator and Prudential Mutual Fund
Management, Inc. as Sub-administrator (the "Sub-administrator"). Under the
amended Agreement, the Fund pays the Administrator a monthly fee at an annual
rate of .15% of the value of the Fund's average weekly net assets up to $250
million and .125% of the value of such net assets in excess of $250 million for
its services, out of which the Administrator pays the Sub-administrator eighty
percent of such fees collected for its services.
At April 30, 1996, the Adviser owned 8,474 shares of the Fund.
Certain officers and/or directors of the Fund are also officers and/or directors
of the Adviser.
The Fund pays each Director not affiliated with the Adviser a fee of $5,000 per
year, a fee of $700 for attendance at each in-person meeting, a fee of $100 for
participation in each telephonic meeting and reimbursement for travel and
out-of-pocket expenses for each board and committee meeting attended.
NOTE 4. PORTFOLIO ACTIVITY AND FEDERAL INCOME TAX STATUS
Purchases and sales of investment securities, other than short-term investments,
for the six months ended April 30, 1996 aggregated $86,202,607 and $66,322,205,
respectively.
The federal income tax basis of the Fund's investments at April 30, 1996 was
substantially the same as the basis for financial reporting and, accordingly,
net unrealized appreciation for federal income tax purposes was $10,409,095
(gross unrealized appreciation -- $17,963,675; gross unrealized
depreciation -- $7,554,580).
During the six months ended April 30, 1996, permanent book/tax differences of
$5,604,201 arising from foreign currency losses have been reclassified to
distributions in excess of net investment income from accumulated net realized
loss on investments. Net investment income, net realized losses and net assets
were not affected by this reclassification.
For federal income tax purposes, the Fund has a capital loss carryforward as of
October 31, 1995 of approximately $25,472,000 of which approximately $889,000
and $24,583,000 expires in 2002 and 2003, respectively. Accordingly, no capital
gain distributions are expected to be paid to shareholders until net gains have
been realized in excess of such amount.
PAGE 12
<PAGE> 18
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
(unaudited)
NOTE 5. BANK LOAN
The Fund borrowed $60,000,000 pursuant to a secured term loan agreement (the
"Loan") with Morgan Guaranty Trust Company of New York. The Loan agreement was
renewed on November 6, 1995 at an interest rate of 6.75%, which is equal to
six-month LIBOR plus 1.375% and the maturity date is May 6, 1996. Interest is
payable upon maturity. In accordance with the terms of the Loan, the Fund must
maintain a level of collateral to debt of between 175-225%. The collateral for
the Loan was valued at $136,540,397 on April 30, 1996 and is being held in a
segregated account by the Fund's custodian.
The net asset value of the Fund could be negatively affected if the Fund were
required to liquidate assets in other than an orderly manner and/or in adverse
market conditions to repay any bank loans outstanding.
NOTE 6. LOAN PARTICIPATIONS
The Fund invests in U.S. dollar-denominated fixed and floating rate loans
("Loans") arranged through private negotiations between a foreign sovereign
entity and one or more financial institutions ("Lenders"). The Fund invests in
such Loans in the form of participations in Loans ("Participations") or
assignments of all or a portion of loans from third parties ("Assignments").
Participations typically result in the Fund having a contractual relationship
only with the Lender, not with the sovereign borrower. The Fund has the right to
receive payments of principal, interest and any fees to which it is entitled
only from the Lender selling the Participation and only upon receipt by the
Lender of the payments from the borrower. In connection with purchasing
Participations, the Fund generally has no right to enforce compliance by the
borrower with the terms of the loan agreements relating to the loan, nor any
rights of set-off against the borrower, and the Fund will not benefit directly
from any collateral supporting the Loan in which it has purchased the
Participation. As a result, the Fund assumes the credit risk of both the
borrower and the Lender that is selling the Participation. The Fund may have
difficulty disposing of Participations and Assignments because the market for
such instruments is not highly liquid.
NOTE 7. CREDIT AND MARKET RISK
The yields of emerging market debt obligations and high yield corporate debt
obligations reflect, among other things, perceived credit risk. The Fund's
investment in securities rated below investment grade typically involve risks
not associated with higher rated securities including, among others, overall
greater risk of timely and ultimate payment of interest and
PAGE 13
<PAGE> 19
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
(unaudited)
principal, greater market price volatility and less liquid secondary market
trading. The consequences of political, social, economic or diplomatic changes
may have disruptive effects on the market prices of investments held by the
Fund. At April 30, 1996, the Fund has a concentration of credit risk in
sovereign debt of emerging market countries.
Investing in foreign securities may also involve certain considerations and
risks not typically associated with those of domestic origin as a result of,
among other factors, the level of governmental supervision and regulation of
foreign securities markets and the risks of loss from currency devaluations and
other exchange rate fluctuations.
NOTE 8. FINANCIAL INSTRUMENTS WITH OFF-BALANCE SHEET RISK
The Fund enters into forward contracts in order to hedge its exposure to changes
in foreign currency exchange rates on its foreign portfolio holdings or on
specific receivables and payables denominated in a foreign currency. Forward
contracts involve elements of market risk in excess of the amount reflected in
the Statement of Assets and Liabilities. The Fund bears the risk of an
unfavorable change in the foreign exchange rate underlying the forward contract.
Risks may also arise upon entering into these contracts from the potential
inability of the counterparties to meet the terms of their contracts. As of
April 30, 1996, all forward contracts which the Fund has entered into have been
compensated by the Fund with offsetting closing transactions.
Consistent with its objective to seek high current income, the Fund invests in
instruments whose values and interest rates may be linked to foreign currencies,
interest rates, indices or some other financial indicator. The value at maturity
or interest rates for these instruments will increase or decrease according to
the change in the indicator to which it is indexed. These securities are
generally more volatile in nature and the risk of loss of principal or interest
is greater.
NOTE 9. EVENTS SUBSEQUENT TO APRIL 30, 1996
Subsequent to April 30, 1996, the Board of Directors of the Fund declared
dividends of $.11875 per common share payable May 31, 1996 and June 28, 1996 to
shareholders of record on May 14, 1996 and June 18, 1996, respectively.
The Loan Agreement with Morgan Guaranty Trust Company was renewed on May 6, 1996
at an interest rate of 6.60156%, which is equal to six-month LIBOR plus 1.375%,
and the maturity date is November 6, 1996.
PAGE 14
<PAGE> 20
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
- --------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (concluded)
NOTE 10. QUARTERLY DATA (UNAUDITED)
<TABLE>
<CAPTION>
NET REALIZED AND
CHANGE IN UNREALIZED NET INCREASE
GAINS (LOSSES) ON (DECREASE) IN NET
NET INVESTMENT INVESTMENTS AND ASSETS RESULTING FROM
INCOME FOREIGN CURRENCIES OPERATIONS
------------------ ---------------------- ----------------------
TOTAL PER PER PER
QUARTERLY PERIOD INCOME AMOUNT SHARE AMOUNT SHARE AMOUNT SHARE
--------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
December 31, 1993*
to January 31, 1994............ $ 855,302 $ 666,958 $.053 $ 651,408 $ .051 $ 1,318,366 $ .104
February 1, 1994
to April 30, 1994.............. 3,755,934 3,068,100 .242 (30,047,353) (2.374) (26,979,253) (2.132)
May 1, 1994
to July 31, 1994............... 5,659,468 4,838,529 .382 (4,196,038) (.332) 642,491 .050
August 1, 1994
to October 31, 1994............ 6,377,379 4,396,866 .347 611,672 .048 5,008,538 .395
November 1, 1994
to January 31, 1995............ 6,109,343 4,500,735 .356 (54,531,478) (4.308) (50,030,743) (3.952)
February 1, 1995
to April 30, 1995.............. 6,621,361 5,010,043 .396 31,740,675 2.508 36,750,718 2.904
May 1, 1995
to July 31, 1995............... 7,260,442 5,647,319 .446 9,571,130 .756 15,218,449 1.202
August 1, 1995
to October 31, 1995............ 8,164,877 6,466,109 .511 1,986,368 .157 8,452,477 .668
November 1, 1995
to January 31, 1996............ 7,973,433 6,446,891 .509 35,190,168 2.780 41,637,059 3.290
February 1, 1996
to April 30, 1996.............. 7,977,538 6,270,053 .495 (8,530,399) (.674) (2,260,346) (.179)
<CAPTION>
DISTRIBUTIONS
------------------ SHARE PRICE
PER -------------
QUARTERLY PERIOD AMOUNT SHARE HIGH LOW
--------------------------
<S> <C> <C> <C> <C>
December 31, 1993*
to January 31, 1994............ -- -- $15 1/8 $15
February 1, 1994
to April 30, 1994.............. $4,509,103 $.356 15 1/8 12
May 1, 1994
to July 31, 1994............... 4,509,103 .356 13 1/2 11 1/8
August 1, 1994
to October 31, 1994............ 4,509,103 .356 12 5/8 10 3/4
November 1, 1994
to January 31, 1995............ 4,509,103 .356 11 3/4 9 1/4
February 1, 1995
to April 30, 1995.............. 4,509,103 .356 11 1/8 9 3/8
May 1, 1995
to July 31, 1995............... 4,509,105 .356 11 3/4 10 3/4
August 1, 1995
to October 31, 1995............ 4,509,105 .356 11 5/8 11
November 1, 1995
to January 31, 1996............ 4,509,110 .356 13 3/8 11 1/8
February 1, 1996
to April 30, 1996.............. 4,509,109 .356 13 1/2 12 1/8
</TABLE>
- --------------------------------------------------------------------------------
* Commencement of investment operations.
PAGE 15
<PAGE> 21
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
- -----------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
<TABLE>
<CAPTION>
FOR THE
SIX MONTHS
ENDED FOR THE YEAR DECEMBER 31, 1993*
APRIL 30, 1996 ENDED THROUGH
(UNAUDITED) OCTOBER 31, 1995 OCTOBER 31, 1994
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C>
PER SHARE OPERATING PERFORMANCE:
Net asset value, beginning of period.............. $ 10.71 $ 11.31 $ 14.03++
-------------- -------- --------
INCOME FROM INVESTMENT OPERATIONS:
Net investment income............................. 1.00 1.71 1.02
Net realized and unrealized gain (loss) on
investments..................................... 2.11 (.89) (2.60)
-------------- -------- --------
Total from investment operations.............. 3.11 .82 (1.58)
-------------- -------- --------
LESS DISTRIBUTIONS:
Dividends from net investment income.............. (.56) (1.37) (1.01)
Distributions in excess of net investment
income.......................................... (.15) (.05) (.06)
-------------- -------- --------
Total distributions........................... (.71) (1.42) (1.07)
-------------- -------- --------
Offering costs with respect to issuance of
shares.......................................... -- -- (.07)
-------------- -------- --------
Net asset value, end of period.................... $ 13.11 $ 10.71 $ 11.31
============== ========= ========
Market price per share, end of period............. $ 12.75 $ 11.375 $ 10.75
============== ======== =======
TOTAL INVESTMENT RETURN(A)........................ 18.70% 20.61% (16.55)%+
RATIOS TO AVERAGE NET ASSETS:
Total expenses................................ 4.24%# 5.04% 2.90%#
Operating expenses............................ 1.55%# 1.42% 1.36%#
Interest expense.............................. 2.69%# 3.62% 1.54%#
Net investment income......................... 16.68%# 16.70% 10.24%#
SUPPLEMENTAL DATA:
Net assets, end of period (000)............... $165,899 $135,540 $143,159
Average net assets (000)...................... $153,347 $129,516 $151,954
Portfolio turnover rate....................... 33% 101% 13%
Asset coverage for Loan outstanding........... 376% 326% 339%
Weighted average bank loan (000).............. $ 60,000 $ 60,000 $ 39,934
Weighted average interest rate on bank loan... 6.87% 7.83% 5.88%#
</TABLE>
- --------------------------------------------------------------------------------
<TABLE>
<C> <S>
* Commencement of investment operations.
(a) Total investment return is calculated assuming a purchase of common stock at the current market price on
the first day and a sale at the current market price on the last day of each period reported. Dividends
and distributions are assumed, for purposes of this calculation, to be reinvested at prices obtained
under the Fund's dividend reinvestment plan. Total investment return does not reflect brokerage
commissions. Total investment return for periods of less than one full year are not annualized.
+ Based on beginning period price of $14.03 (initial offering price of $15.00 less sales load of $.975)
and end of period market value of $10.75 per share.
++ Net asset value immediately after closing of initial public offering was $13.96.
# Annualized.
</TABLE>
PAGE 16
<PAGE> 22
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
- --------------------------------------------------------------------------------
FORM OF AMENDED AND RESTATED TERMS AND CONDITIONS OF DIVIDEND REINVESTMENT PLAN
1. Each shareholder initially purchasing shares of common stock ("Shares") of
Salomon Brothers Worldwide Income Fund Inc (the "Fund") on or after September 6,
1996 will be deemed to have elected to be a participant in the Amended and
Restated Dividend Reinvestment Plan (the "Plan"), unless the shareholder
specifically elects in writing (addressed to the Agent at the address below or
to any nominee who holds Shares for the shareholder in its name) to receive all
income dividends and distributions of capital gains in cash, paid by check,
mailed directly to the record holder by or under the direction of American Stock
Transfer & Trust Company as the Fund's dividend-paying agent (the "Agent"). All
other shareholders may elect to be a participant in the Plan by completing and
returning the attached Authorization Card to the Agent at the address below or
to any nominee who holds Shares for the shareholder in its name. Notwithstanding
the foregoing, a shareholder whose Shares are held in the name of a broker or
nominee who does not provide an automatic reinvestment service may be required
to take such Shares out of "street name" and register such Shares in the
shareholder's name in order to participate, otherwise dividends and
distributions will be paid in cash to such shareholder by the broker or nominee.
Each participant in the Plan is referred to herein as a "Participant." The Agent
will act as Agent for each Participant, and will open accounts for each
Participant under the Plan in the same name as their Shares are registered.
2. Unless the Fund declares a dividend or distribution payable only in the form
of cash, the Agent will apply all dividends and distributions in the manner set
forth below.
3. If, on the determination date, the market price per Share equals or exceeds
the net asset value per Share on that date (such condition, a "market premium"),
the Agent will receive the dividend or distribution in newly issued Shares of
the Fund on behalf of Participants. If, on the determination date, the net asset
value per Share exceeds the market price per Share (such condition, a "market
discount"), the Agent will purchase Shares in the open-market. The determination
date will be the fourth New York Stock Exchange trading day (a New York Stock
Exchange trading day being referred to herein as a "Trading Day") preceding the
payment date for the dividend or distribution. For purposes herein, "market
price" will mean the average of the highest and lowest prices at which the
Shares sell on the New York Stock Exchange on the particular date, or if there
is no sale on that date, the average of the closing bid and asked quotations.
4. Purchases made by the Agent will be made as soon as practicable commencing on
the Trading Day following the determination date and terminating no later than
30 days after the dividend or distribution payment date except where temporary
curtailment or suspension of purchase is necessary to comply with applicable
provisions of federal securities law; provided, however, that such purchases
will, in any event, terminate on the Trading Day prior to the "ex-dividend" date
next succeeding the dividend or distribution payment date.
PAGE 17
<PAGE> 23
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
5. If (i) the Agent has not invested the full dividend amount in open-market
purchases by the date specified in paragraph 4 above as the date on which such
purchases must terminate or (ii) a market discount shifts to a market premium
during the purchase period, then the Agent will cease making open-market
purchases and will receive the uninvested portion of the dividend amount in
newly issued Shares (x) in the case of (i) above, at the close of business on
the date the Agent is required to terminate making open-market purchases as
specified in paragraph 4 above or (y) in the case of (ii) above, at the close of
business on the date such shift occurs; but in no event prior to the payment
date for the dividend or distribution.
6. In the event that all or part of a dividend or distribution amount is to be
paid in newly issued Shares, such Shares will be issued to Participants in
accordance with the following formula: (i) if, on the valuation date, the net
asset value per share is less than or equal to the market price per Share, then
the newly issued Shares will be valued at net asset value per Share on the
valuation date; provided, however, that if the net asset value is less than 95%
of the market price on the valuation date, then such Shares will be issued at
95% of the market price and (ii) if, on the valuation date, the net asset value
per share is greater than the market price per Share, then the newly issued
Shares will be issued at the market price on the valuation date. The valuation
date will be the dividend or distribution payment date, except that with respect
to Shares issued pursuant to paragraph 5 above, the valuation date will be the
date such Shares are issued. If a date that would otherwise be a valuation date
is not a Trading Day, the valuation date will be the next preceding Trading Day.
7. The open-market purchases provided for above may be made on any securities
exchange on which the Shares of the Fund are traded, in the over-the-counter
market or in negotiated transactions, and may be on such terms as to price,
delivery and otherwise as the Agent shall determine. Funds held by the Agent
uninvested will not bear interest, and it is understood that, in any event, the
Agent shall have no liability in connection with any inability to purchase
Shares within the time periods herein provided, or with the timing of any
purchases effected. The Agent shall have no responsibility as to the value of
the Shares acquired for the Participant's account. The Agent may commingle
amounts of all Participants to be used for open-market purchases of Shares and
the price per Share allocable to each Participant in connection with such
purchases shall be the average price (including brokerage commissions) of all
Shares purchased by the Agent.
8. The Agent will maintain all Participant accounts in the Plan and will furnish
written confirmations of all transactions in each account, including information
needed by Participants for personal and tax records. The Agent will hold Shares
acquired pursuant to the Plan in noncertificated form in the Participant's name
or that of its nominee, and each Participant's proxy will include those Shares
purchased pursuant to the Plan. The Agent will forward to Participants any proxy
solicitation material and will vote any Shares so held for Participants only in
accordance with the proxy returned by Participants to the Fund. Upon written
request, the Agent will deliver to Participants, without charge, a certificate
or certificates for the full Shares.
PAGE 18
<PAGE> 24
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
9. The Agent will confirm to Participants each acquisition made for their
respective accounts as soon as practicable but not later than 60 days after the
date thereof. Although Participants may from time to time have an undivided
fractional interest (computed to three decimal places) in a Share of the Fund,
no certificates for fractional shares will be issued. Dividends and
distributions on fractional shares will be credited to each Participant's
account. In the event of termination of a Participant's account under the Plan,
the Agent will adjust for any such undivided fractional interest in cash at the
market value of the Fund's Shares at the time of termination less the pro rata
expense of any sale required to make such an adjustment.
10. Any share dividends or split shares distributed by the Fund on Shares held
by the Agent for Participants will be credited to their respective accounts. In
the event that the Fund makes available to Participants rights to purchase
additional Shares or other securities, the Shares held for Participants under
the Plan will be added to other Shares held by the Participants in calculating
the number of rights to be issued to Participants.
11. The Agent's service fee for handling capital gains distributions or income
dividends will be paid by the Fund. Participants will be charged a pro rata
share of brokerage commissions on all open-market purchases.
12. Participants may terminate their accounts under the Plan by notifying the
Agent in writing. Such termination will be effective immediately if notice is
received by the Agent not less than ten days prior to any dividend or
distribution record date; otherwise such termination will be effective on the
first trading day after the payment date for such dividend or distribution with
respect to any subsequent dividend or distribution. The Plan may be amended or
terminated by the Fund as applied to any dividend or capital gains distribution
paid subsequent to written notice of the change or termination sent to
Participants at least 30 days prior to the record date for the dividend or
capital gains distribution. The Plan may be amended or terminated by the Agent,
with the Fund's prior written consent, on at least 30 days' written notice to
Plan Participants. Notwithstanding the preceding two sentences, the Agent or the
Fund may amend or supplement the Plan at any time or times when necessary or
appropriate to comply with applicable law or rules or policies of the Securities
and Exchange Commission or any other regulatory authority. Upon any termination,
the Agent will cause a certificate or certificates for the full Shares held by
each Participant under the Plan and cash adjustment for any fraction to be
delivered to each Participant without charge. If the Participant elects by
notice to the Agent in writing in advance of such termination to have the Agent
sell part or all of a Participant's Shares and remit the proceeds to
Participant, the Agent is authorized to deduct a $2.50 fee plus brokerage
commission for this transaction from the proceeds.
13. Any amendment or supplement shall be deemed to be accepted by each
Participant unless, prior to the effective date thereof, the Agent receives
written notice of the termination of the Participant's account under the Plan.
Any such amendment may include an appointment by the Agent in its place and
stead of a successor Agent under these terms and conditions, with full power and
authority to perform all or any of the acts to be performed by
PAGE 19
<PAGE> 25
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
the Agent under these terms and conditions. Upon any such appointment of an
Agent for the purpose of receiving dividends and distributions, the Fund will be
authorized to pay to such successor Agent, for each Participant's account, all
dividends and distributions payable on Shares of the Fund held in each
Participant's name or under the Plan for retention or application by such
successor Agent as provided in these terms and conditions.
14. In the case of Participants, such as banks, broker-dealers or other
nominees, which hold Shares for others who are beneficial owners ("Nominee
Holders"), the Agent will administer the Plan on the basis of the number of
Shares certified from time to time by each Nominee Holder as representing the
total amount registered in the Nominee Holder's name and held for the account of
beneficial owners who are to participate in the Plan.
15. The Agent shall at all times act in good faith and use its best efforts
within reasonable limits to insure the accuracy of all services performed under
this Agreement and to comply with applicable law, but assumes no responsibility
and shall not be liable for loss or damage due to errors unless such error is
caused by its negligence, bad faith, or willful misconduct or that of its
employees.
16. All correspondence concerning the Plan should be directed to the Agent at 40
Wall Street, 46th Floor, New York, New York 10005.
17. These terms and conditions shall be governed by the laws of the State of New
York.
Dated: December 22, 1993, as amended and
restated September 6, 1996
ACKNOWLEDGED AND ACCEPTED:
American Stock Transfer
and Trust Company
By: /s/ GERALD RUDDY
----------------
Name: Gerald Ruddy
Title: Vice President
PAGE 20
<PAGE> 26
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
AUTHORIZATION CARD
THIS FORM IS FOR SHAREHOLDERS WHO HOLD SHARES IN THEIR OWN
NAMES. IF YOUR SHARES ARE HELD THROUGH A BROKERAGE FIRM, BANK
OR OTHER NOMINEE, YOU SHOULD CONTACT YOUR NOMINEE TO ARRANGE
FOR IT TO PARTICIPATE IN THE PLAN ON YOUR BEHALF.
AUTHORIZATION FOR REINVESTMENT OF DIVIDENDS
AND DISTRIBUTIONS
(Please read carefully before signing.)
I hereby authorize Salomon Brothers Worldwide Income Fund Inc (the "Fund") to
pay to American Stock Transfer and Trust Company for my account all income
dividends and capital gains distributions payable to me on shares of Common
Stock of the Fund now or hereafter registered in my name.
I hereby appoint American Stock Transfer and Trust Company as my Agent and
authorize the Agent to apply all such income dividends and capital gains
distributions in accordance with the Amended and Restated Terms and Conditions
of the Dividend Reinvestment Plan set forth accompanying this Authorization
Card.
The authorization and appointment is given with the understanding that I may
terminate it at any time by terminating my account under the Plan as provided in
such Amended and Restated Terms and Conditions.
Please sign exactly as your shares are registered. All persons whose names
appear on the share certificates must sign.
---------------------------------------------------
Participant
---------------------------------------------------
Participant
---------------------------------------------------
Date
YOU SHOULD NOT RETURN THIS FORM IF YOU WISH TO RECEIVE YOUR DIVIDENDS OR
DISTRIBUTIONS IN CASH.
THIS IS NOT A PROXY.
<PAGE> 27
This authorization form, when signed, should be mailed to:
American Stock Transfer & Trust Company
40 Wall Street, 46th Floor
New York, New York 10005
Attn: Salomon Brothers Worldwide Income Fund Inc
<PAGE> 28
SALOMON BROTHERS WORLDWIDE INCOME FUND INC
- -----------
DIRECTORS
CHARLES F. BARBER
Consultant; formerly Chairman,
ASARCO Incorporated
THOMAS W. BROCK
Chairman and Chief Executive Officer,
Salomon Brothers Asset Management Inc
DANIEL P. CRONIN
Vice President -- General Counsel,
Pfizer International Inc.
ALLAN C. HAMILTON
Consultant; formerly Vice President
and Treasurer, Exxon Corp.
MICHAEL S. HYLAND
Managing Director, Salomon Brothers Inc
President, Salomon Brothers
Asset Management Inc
RIORDAN ROETT
Professor and Director,
Latin American Studies Program,
Paul H. Nitze School of
Advanced International Studies,
Johns Hopkins University
JESWALD W. SALACUSE
Henry J. Braker
Professor of Commercial Law,
The Fletcher School of Law & Diplomacy, Tufts University
- ---------
OFFICERS
MICHAEL S. HYLAND
Chairman and President
THOMAS FLANAGAN
Executive Vice President
PETER J. WILBY
Executive Vice President
LAWRENCE H. KAPLAN
Executive Vice President
and General Counsel
ALAN M. MANDEL
Treasurer
LAURIE A. PITTI
Assistant Treasurer
TANA E. TSELEPIS
Secretary
JENNIFER MUZZEY
Assistant Secretary
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SALOMON BROTHERS
WORLDWIDE INCOME FUND INC
Seven World Trade Center
New York, New York 10048
For information call (toll free)
1-800-SALOMON
INVESTMENT ADVISER AND ADMINISTRATOR
Salomon Brothers Asset Management Inc
Seven World Trade Center
New York, New York 10048
SUB-ADMINISTRATOR
Prudential Mutual Fund Management, Inc.
One Seaport Plaza
New York, New York 10292
CUSTODIAN
Brown Brothers Harriman & Co.
40 Water Street
Boston, MA 02109
TRANSFER AGENT
American Stock Transfer & Trust Company
40 Wall Street
New York, New York 10005
LEGAL COUNSEL
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
NEW YORK STOCK EXCHANGE SYMBOL
SBW
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Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940 that the Fund may purchase, from time to time, shares of
its common stock at market prices.
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This report is for stockholder information.
This is not a prospectus intended for use in
the purchase or sale of Fund shares.
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