UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number: 811-7964
ACM Managed Dollar Income Fund, Inc.
(Exact name of registrant as specified in charter)
1345 Avenue of the Americas, New York, New York 10105
(Address of principal executive offices) (Zip code)
Mark R. Manley
Alliance Capital Management, L.P.
1345 Avenue of the Americas
New York, New York 10105
(Name and address of agent for service)
Registrant's telephone number, including area code: (800) 221-5672
Date of fiscal year end: September 30, 2003
Date of reporting period: September 30, 2003
ITEM 1. REPORTS TO STOCKHOLDERS.
[LOGO] AllianceBernstein(SM)
Investment Research and Management
ACM Managed Dollar Income Fund
Annual Report--September 30, 2003
Investment Products Offered
====================================
o Are Not FDIC Insured
o May Lose Value
o Are Not Bank Guaranteed
====================================
You may obtain a description of the Fund's proxy voting policies and procedures,
without charge, upon request by visiting Alliance Capital's web site at
www.investor.alliancecapital.com or on the Securities and Exchange Commission's
web site at http://www.sec.gov, or by calling Alliance Capital at (800)
227-4618.
AllianceBernstein Investment Research and Management, Inc., the principal
underwriter of the AllianceBernstein mutual funds and an affiliate of Alliance
Capital Management L.P., the manager of the funds, is a member of the NASD.
November 20, 2003
Annual Report
This report provides management's discussion of fund performance for ACM Managed
Dollar Income Fund (the "Fund") for the annual reporting period ended September
30, 2003.
Investment Objective and Policies
This closed-end fund is designed for investors who seek high current income and
capital appreciation. To achieve this objective, it invests primarily in
high-yielding, U.S. and non-U.S. fixed income securities, denominated in U.S.
dollars, that we expect to benefit from improving economic and credit
fundamentals.
Investment Results
The following table shows how the Fund performed over the past six- and 12-month
periods ended September 30, 2003. For comparison, we have included a composite
benchmark consisting of 65% of the J.P. Morgan Emerging Markets Bond Index Plus
(JPM EMBI+), a standard measure of the performance of a basket of unmanaged
emerging market debt securities, and 35% of the Credit Suisse First Boston High
Yield (CSFBHY) Index, a standard measure of the performance of a basket of
unmanaged U.S. high yield debt securities. We compare the Fund's performance to
this composite benchmark because it more closely resembles the composition of
the Fund's portfolio.
INVESTMENT RESULTS*
Periods Ended September 30, 2003
----------------------------
Returns
----------------------------
6 Months 12 Months
--------------------------------------------------------------------------------
ACM Managed
Dollar Income
Fund (NAV) 17.76% 54.77%
--------------------------------------------------------------------------------
J.P. Morgan
Emerging
Markets
Bond Index
Plus 13.73% 40.19%
--------------------------------------------------------------------------------
Credit Suisse
First Boston
High Yield
Index 13.08% 28.05%
--------------------------------------------------------------------------------
Composite:
65%/35%
(65% JPM
EMBI+/35%
CSFBHY
Index) 13.54% 35.98%
--------------------------------------------------------------------------------
The Fund's Market Price per share on September 30, 2003 was $8.15.
* The Fund's investment results are for the periods shown and are based on
the net asset value (NAV) of the Fund as of September 30, 2003. All fees and
expenses related to the operation of the Fund have been deducted. Returns for
the Fund include the reinvestment of any distributions paid during each
period. Past performance is no guarantee of future results.
The unmanaged J.P. Morgan Emerging Markets Bond Index Plus is comprised of
dollar-denominated
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 1
restructured sovereign bonds; a large percentage of the index is made up of
Brady bonds. The unmanaged Credit Suisse First Boston High Yield Index is a
measure of lower-rated, fixed income, non-convertible U.S. dollar-denominated
securities meeting certain criteria developed by Credit Suisse designed to
enable the index to reflect the high yield market. The indices are unmanaged
and reflect no fees or expenses. An investor cannot invest directly in an
index, and its results are not indicative of any specific investment,
including ACM Managed Dollar Income Fund.
The Fund significantly outperformed its composite benchmark for both the six-
and 12-month periods ended September 30, 2003. The Fund benefited primarily from
its emerging market debt country weightings, individual security selection and
the Fund's ability to leverage. Country and security selection in the Fund's
overweight allocation to Brazil was the largest contributor to both absolute and
relative performance for the periods under review. Brazilian debt was also a top
performer within the JPM EMBI+. The Fund's overweight position of Russia
contributed positively to performance, as prospects for rating agency upgrades
reflected the success of structural reforms that have led to economic growth and
debt reduction. The Fund's holdings of Uruguayan and Venezuelan debt also had a
positive impact on performance. Both countries conducted debt exchanges during
this period that significantly improved the maturity structure of their external
debt.
The Fund's high yield holdings contributed strong absolute returns, but modest
underperformance relative to the composite benchmark. The Fund's underweighted
position in the utility sector detracted from performance, as this sector showed
strong performance throughout the reporting period. The Fund benefited from its
overweighting in cable and wireless communications in which valuations
significantly appreciated from previously oversold levels. In addition, the
Fund's underweighting in energy, which languished at relatively overvalued
levels versus the overall market, added to relative performance. Security
selection also had a meaningful role in the Fund's performance. The Fund was
underweighted versus the CSFBHY Index in more risky but stronger performing
CCC-rated credits in most sectors.
Market Review and Investment Strategy
During the annual reporting period, investors' desire for higher yielding asset
classes benefited both the emerging debt and high yield markets, as high levels
of global liquidity encouraged more risk taking. The emerging market debt class,
as represented by the JPM EMBI+, returned a strong 40.19% for the 12-month
period under review. Latin countries outperformed non-Latin regions, which
posted returns of 50.07% and 27.76%, respectively. All countries represented
within the index posted positive returns. Top performing countries included
Brazil at 108.78%, Ecuador at 87.90%, Nigeria at 63.32%, Peru at 47.66% and
Colombia at 45.60%, while Bulgaria at 13.62%, Malaysia at 9.58% and Poland at
9.43% lagged. As risk aver-
--------------------------------------------------------------------------------
2 o ACM Managed Dollar Income Fund
sion abated, the high yield sector rebounded strongly during the annual period,
returning 28.05%, as measured by the CSFBHY Index. The telecommunication, media,
utility and technology sectors, as well as the CCC credit tier, performed best
during the 12-month period.
At the beginning of the annual period, we increased the Fund's exposure to
Brazil on expectations of a victory for President Lula and our confidence that
his administration would implement market-friendly policies. We further
increased the Fund's exposure to the country as President Lula exceeded
expectations in his ability to push forward crucial tax and social security
reforms. Russia and Mexico continued to be a large percentage of the Fund's
exposure; however, we reduced holdings of Mexico in the final three months of
the period as bond valuations began to exceed interest rate risk. We have
maintained the Fund's overweight position in Russian sovereign debt as credit
statistics continued to improve. In April, Uruguay, with the support of the
International Monetary Fund (IMF), announced an aggressive plan to swap its
outstanding debt for longer maturity securities. We aggressively purchased
Uruguay bonds after this announcement--a tactic that proved beneficial.
Within the high yield sector, we maintained the Fund's positions in certain
cyclical sectors, such as paper and packaging and services, but continued to
reduce allocations in specific names to enhance sector diversification. We
continued to underweight credit challenged sectors, such as airlines,
technology, utilities, wireline telecommunications and retail, but added some
issuers in these sectors as we identified value in certain names. We maintained
the Fund's underweighted positions in utilities and technology, due to credit
concerns, as well as underweight positions in food/beverage and energy, due to
unattractive valuation levels.
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 3
PERFORMANCE UPDATE
ACM MANAGED DOLLAR INCOME FUND (NAV)
GROWTH OF A $10,000 INVESTMENT
10/22/93* TO 9/30/03
ACM Managed Dollar Income Fund (NAV): $20,337
Composite: $25,475
[THE FOLLOWING TABLE WAS DEPICTED AS A MOUNTAIN CHART IN THE PRINTED MATERIAL.]
ACM Managed Dollar Income Fund (NAV) Composite**
--------------------------------------------------------------------------------
10/22/93* $10,000 $10,000
9/30/94 8,836 9,380
9/30/95 9,375 10,159
9/30/96 13,206 13,303
9/30/97 17,648 16,303
9/30/98 11,257 13,593
9/30/99 13,345 15,813
9/30/00 14,576 18,799
9/30/01 13,107 18,692
9/30/02 13,137 18,740
9/30/03 20,337 25,475
This chart illustrates the total value of an assumed $10,000 investment in ACM
Managed Dollar Income Fund at net asset value (NAV) (from 10/22/93* to 9/30/03)
as compared to the performance of an appropriate composite. The composite
represents 65% of the J.P. Morgan Emerging Markets Bond Index Plus (JPM EMBI+)
and 35% of the Credit Suisse First Boston High Yield (CSFBHY) Index. The
composite is from the inception of the JPM EMBI+, which was 12/31/93. For the
period 10/22/93 through 9/30/94, the J.P. Morgan Emerging Markets Bond Index was
used in place of the JPM EMBI+. All other periods used the composite benchmark.
The chart assumes the reinvestment of dividends and capital gains. Past
performance is not indicative of future results, and is not representative of
future gain or loss in capital value or dividend income.
* Fund and benchmark data are from the Fund's inception date of 10/22/93.
** The unmanaged JPM EMBI+ is comprised of dollar-denominated restructured
sovereign bonds; a large percentage of the index is made up of Brady bonds.
The CSFBHY Index is a measure of lower-rated, fixed-income, non-convertible
U.S. dollar-denominated securities meeting certain criteria developed by
Credit Suisse designed to enable the index to reflect the high yield market.
The indices are unmanaged and reflect no fees or expenses. When comparing
ACM Managed Dollar Income Fund to the composite shown above, you should note
that no charges or expenses are reflected in the performance of the
composite. An investor cannot invest directly in an index, and its results
are not indicative of any specific investment, including ACM Managed Dollar
Income Fund.
--------------------------------------------------------------------------------
4 o ACM Managed Dollar Income Fund
PORTFOLIO SUMMARY
September 30, 2003
INCEPTION DATE
10/22/93
PORTFOLIO STATISTICS
Net Assets ($mil): $173.2
SECURITY TYPE [PIE CHART OMITTED]
47.9% Sovereign
44.6% Corporate
4.0% Brady Bonds
2.4% Yankee Bonds
1.1% Preferred Stock
COUNTRY BREAKDOWN
39.8% United States
22.0% Russia
9.2% Mexico
9.1% Brazil
3.9% Turkey [PIE CHART OMITTED]
2.2% Colombia
2.0% Venezuela
1.7% Philippines
1.5% Peru
1.0% Luxembourg
7.6% Other
All data as of September 30, 2003. The Fund's security type and country
breakdowns are expressed as a percentage of total investments before security
lending collateral and may vary over time. OOtherO represents less than 1.0%
weightings in each of the following countries: Bulgaria, Kazakhstan, Romania,
Uruguay, Cayman Islands, Ukraine, Ecuador, Panama, Canada, El Salvador, Belize,
Ireland, Liberia, United Kingdom, Argentina, France, Singapore and Bahamas.
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 5
PORTFOLIO OF INVESTMENTS
September 30, 2003
Principal
Amount
(000) U.S. $ Value
--------------------------------------------------------------------------------
SOVEREIGN DEBT OBLIGATIONS-67.6%
Argentina-0.3%
Republic of Argentina FRN
1.162%, 8/03/12(a)....................... $ 800 $ 492,000
---------------
Belize-0.5%
Government of Belize
9.50%, 8/15/12........................... 850 854,250
---------------
Brazil-11.8%
Banco Nacional de Desenvolvimento
6.50%, 6/15/06(b)........................ 475 484,500
Republic of Brazil
8.875%, 4/15/24.......................... 1,550 1,243,875
10.00%, 1/16/07.......................... 50 53,375
10.00%, 8/07/11.......................... 1,150 1,124,125
10.125%, 5/15/27......................... 1,250 1,118,750
11.00%, 8/17/40(c)....................... 5,275 4,984,875
11.50%, 3/12/08.......................... 450 492,300
12.00%, 4/15/10.......................... 200 215,300
12.75%, 1/15/20.......................... 1,500 1,607,250
14.50%, 10/15/09......................... 1,000 1,201,500
Republic of Brazil-DCB FRN
Series L
2.1875%, 4/15/12(a)...................... 3,075 2,460,000
C-Bonds
8.00%, 4/15/14(c)........................ 6,065 5,572,241
---------------
20,558,091
---------------
Bulgaria-1.1%
Republic of Bulgaria
8.25%, 1/15/15(b)........................ 1,624 1,848,875
---------------
Colombia-2.8%
Republic of Colombia
8.375%, 2/15/27.......................... 625 566,562
9.75%, 4/23/09........................... 250 276,875
10.00%, 1/23/12.......................... 900 980,100
10.50%, 7/09/10.......................... 150 168,600
10.75%, 1/15/13.......................... 550 616,000
11.75%, 2/25/20(c)....................... 1,910 2,242,340
---------------
4,850,477
---------------
Ecuador-0.8%
Republic of Ecuador
7.00%, 8/15/30(a)(b)..................... 1,775 1,112,037
12.00%, 11/15/12(b)...................... 275 227,563
---------------
1,339,600
---------------
--------------------------------------------------------------------------------
6 o ACM Managed Dollar Income Fund
Principal
Amount
(000) U.S. $ Value
--------------------------------------------------------------------------------
El Salvador-0.5%
Republic of El Salvador
7.75%, 1/24/23(b)........................ $ 450 $ 469,125
8.50%, 7/25/11(b)........................ 400 434,600
---------------
903,725
---------------
Mexico-7.8%
United Mexican States
11.375%, 9/15/16(c)...................... 9,375 13,476,563
---------------
Panama-0.7%
Republic of Panama
9.375%, 4/01/29.......................... 475 535,563
10.75%, 5/15/20.......................... 550 654,500
---------------
1,190,063
---------------
Peru-2.0%
Republic of Peru
9.125%, 2/21/12.......................... 1,525 1,700,375
9.875%, 2/06/15(c)....................... 1,025 1,186,438
Republic of Peru FLIRB VRN
4.50%, 3/07/17(a)........................ 650 567,125
---------------
3,453,938
---------------
Philippines-2.2%
Republic of Philippines
9.00%, 2/15/13 .......................... 150 160,500
9.875%, 1/15/19(c)....................... 2,300 2,501,250
10.625%, 3/16/25(c)...................... 1,075 1,243,238
---------------
3,904,988
---------------
Russia-27.7%
Ministry Finance of Russia
Series V
3.00%, 5/14/08........................... 650 570,375
Series VI
3.00%, 5/14/06........................... 3,600 3,478,680
Russian Federation
5.00%, 3/31/30(a)(b)(c).................. 44,550 42,252,891
5.00%, 3/31/30(a)(b)..................... 1,850 1,751,025
---------------
48,052,971
---------------
Turkey-5.1%
Republic of Turkey
9.50%, 1/15/14(c)........................ 6,400 6,544,000
9.875%, 3/19/08.......................... 400 431,600
11.75%, 6/15/10.......................... 1,175 1,341,263
11.875%, 1/15/30......................... 400 464,000
---------------
8,780,863
---------------
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 7
Principal
Amount
(000) U.S. $ Value
--------------------------------------------------------------------------------
Ukraine-0.8%
Ukraine Government
11.00%, 3/15/07(b)....................... $ 1,241 $ 1,380,377
---------------
Uruguay-0.9%
Republic of Uruguay
7.50%, 3/15/15........................... 151 117,219
7.875%, 1/15/33.......................... 2,065 1,393,875
---------------
1,511,094
---------------
Venezuela-2.6%
Republic of Venezuela
5.375%, 8/07/10.......................... 400 287,000
9.25%, 9/15/27........................... 3,675 2,844,450
10.75%, 9/19/13(b)....................... 1,000 922,500
Republic of Venezuela DCB FRN
Series DL
1.875%, 12/18/07(a)...................... 536 484,282
---------------
4,538,232
---------------
Total Sovereign Debt Obligations
(cost $84,462,440)....................... 117,136,107
---------------
U.S. CORPORATE DEBT OBLIGATIONS-50.4%
Aerospace/Defense-0.5%
K&F Industries, Inc.
Series B
9.625%, 12/15/10......................... 190 209,950
Sequa Corp.
9.00%, 8/01/09........................... 210 231,000
TD Funding Corp.
8.375%, 7/15/11(b)....................... 450 486,000
---------------
926,950
---------------
Automotive-1.5%
Dana Corp.
10.125%, 3/15/10......................... 575 645,438
Dura Operating Corp.
Series D
9.00%, 5/01/09........................... 422 394,570
HLI Operating, Inc.
10.50%, 6/15/10(b)....................... 440 481,800
TRW Automotive, Inc.
9.375%, 2/15/13(b)....................... 410 463,300
11.00%, 2/15/13(b)....................... 255 298,350
United Auto Group, Inc.
9.625%, 3/15/12.......................... 280 307,300
---------------
2,590,758
---------------
--------------------------------------------------------------------------------
8 o ACM Managed Dollar Income Fund
Principal
Amount
(000) U.S. $ Value
--------------------------------------------------------------------------------
Broadcasting & Media-1.4%
Albritton Communications Co.
7.75%, 12/15/12.......................... $ 415 $ 425,375
Emmis Communications Corp.
12.50%, 3/15/11(d)....................... 350 313,250
PRIMEDIA, Inc.
8.00%, 5/15/13(b)........................ 80 81,200
8.875%, 5/15/11.......................... 325 338,813
Radio One, Inc.
8.875%, 7/01/11.......................... 415 453,388
Sinclair Broadcast Group, Inc.
8.00%, 3/15/12........................... 270 286,200
8.75%, 12/15/11.......................... 285 311,363
Young Broadcasting, Inc.
8.50%, 12/15/08.......................... 195 208,650
---------------
2,418,239
---------------
Building & Real Estate-2.1%
Beazer Homes USA, Inc.
8.375%, 4/15/12.......................... 195 211,575
Jacuzzi Brands, Inc.
9.625%, 7/01/10(b)....................... 300 312,750
KB HOME
7.75%, 2/01/10........................... 560 593,600
LNR Property Corp.
7.625%, 7/15/13(b)....................... 125 129,375
10.50%, 1/15/09.......................... 725 775,750
M.D.C Holdings, Inc.
7.00%, 12/01/12.......................... 200 220,209
Meritage Corp.
9.75%, 6/01/11........................... 470 517,000
Schuler Homes, Inc.
10.50%, 7/15/11.......................... 385 438,419
Werner Holdings Co., Inc.
Series A
10.00%, 11/15/07......................... 200 204,000
William Lyon Homes, Inc.
10.75%, 4/01/13.......................... 285 310,650
---------------
3,713,328
---------------
Cable-1.6%
CSC Holdings, Inc.
7.625%, 7/15/18.......................... 405 390,825
DirecTV Holdings LLC
8.375%, 3/15/13.......................... 305 345,412
Echostar DBS Corp.
5.75%, 10/01/08(b)....................... 435 437,719
6.375%, 10/01/11(b)...................... 255 256,275
9.375%, 2/01/09.......................... 795 851,644
Insight Midwest LP
9.75%, 10/01/09.......................... 405 410,062
---------------
2,691,937
---------------
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 9
Principal
Amount
(000) U.S. $ Value
--------------------------------------------------------------------------------
Chemicals-2.3%
Equistar Chemical Funding LP
10.125%, 9/01/08......................... $ 555 $ 552,225
10.625%, 5/01/11(b)...................... 130 129,350
FMC Corp.
10.25%, 11/01/09......................... 270 309,150
Georgia Gulf Corp.
10.375%, 11/01/07........................ 500 530,625
Huntsman Advanced Materials LLC
11.00%, 7/15/10(b)....................... 295 308,275
Huntsman International LLC
9.875%, 3/01/09.......................... 780 822,900
Millennium America, Inc.
9.25%, 6/15/08........................... 275 286,688
Resolution Performance Products LLC
9.50%, 4/15/10........................... 560 574,000
Westlake Chemical Corp.
8.75%, 7/15/11(b)........................ 445 463,913
---------------
3,977,126
---------------
Communications - Fixed-1.7%
FairPoint Communications, Inc.
11.875%, 3/01/10......................... 300 343,500
Qwest Corp.
8.875%, 3/15/12(b)....................... 1,525 1,700,375
Time Warner Telecom, Inc.
10.125%, 2/01/11......................... 940 942,350
---------------
2,986,225
---------------
Communications - Mobile-2.9%
ACC Escrow Corp.
10.00%, 8/01/11(b)....................... 660 712,800
Dobson Communications Corp.
8.875%, 10/01/13(b)...................... 790 802,837
Dobson/Sygnet Communications
12.25%, 12/15/08......................... 675 727,312
Iridium LLC Capital Corp.
Series B
14.00%, 7/15/05(e)....................... 5,000 400,000
Nextel Communications, Inc.
7.375%, 8/01/15.......................... 460 466,900
9.50%, 2/01/11........................... 500 555,000
9.95%, 2/15/08........................... 430 454,188
TeleCorp PCS, Inc.
10.625%, 7/15/10......................... 203 240,514
Tritel PCS, Inc.
10.375%, 1/15/11......................... 234 282,607
Triton PCS, Inc.
8.75%, 11/15/11.......................... 405 406,012
---------------
5,048,170
---------------
-------------------------------------------------------------------------------
10 o ACM Managed Dollar Income Fund
Principal
Amount
(000) U.S. $ Value
--------------------------------------------------------------------------------
Consumer Manufacturing-2.2%
Applica, Inc.
10.00%, 7/31/08.......................... $ 162 $ 170,505
Broder Brothers Co.
11.25%, 10/15/10(b)...................... 500 508,750
Central Garden & Pet Company
9.125%, 2/01/13.......................... 195 213,525
Collins & Aikman Floorcoverings, Inc.
9.75%, 2/15/10........................... 260 275,600
Hines Nurseries, Inc.
10.25%, 10/01/11(b)...................... 235 246,750
Jostens, Inc.
12.75%, 5/01/10.......................... 650 757,250
Rayovac Corp.
8.50%, 10/01/13(b)....................... 185 185,000
Salton, Inc.
12.25%, 4/15/08.......................... 490 481,425
Sealy Mattress Co.
9.875%, 12/15/07......................... 410 414,100
St. John Knits International, Inc.
12.50%, 7/01/09.......................... 200 220,000
Warnaco, Inc.
8.875%, 6/15/13(b)....................... 280 301,700
---------------
3,774,605
---------------
Energy-4.6%
Chesapeake Energy Corp.
7.75%, 1/15/15........................... 855 906,300
CITGO Petroleum Corp.
11.375%, 2/01/11(b)...................... 1,630 1,850,050
Frontier Escrow Corp.
8.00%, 4/15/13(b)........................ 90 91,800
Frontier Oil Corp.
11.75%, 11/15/09......................... 260 295,100
Grant Prideco, Inc.
9.00%, 12/15/09.......................... 600 649,500
Grey Wolf, Inc.
8.875%, 7/01/07.......................... 90 92,250
Hilcorp Energy
10.50%, 9/01/10(b)....................... 1,055 1,126,212
Northwest Pipelines Corp.
8.125%, 3/01/10.......................... 330 359,700
Pioneer Natural Resources Co.
8.875%, 4/15/05 ......................... 395 427,588
Premco Refining Group, Inc.
9.50%, 2/01/13........................... 270 298,350
Pride International, Inc.
9.375%, 5/01/07.......................... 145 150,075
Southern Natural Gas Co.
7.35%, 2/15/31........................... 365 337,625
8.875%, 3/15/10.......................... 290 311,750
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 11
Principal
Amount
(000) U.S. $ Value
--------------------------------------------------------------------------------
Universal Compression, Inc.
7.25%, 5/15/10........................... $ 220 $ 227,700
Westport Resources Corp.
8.25%, 11/01/11(b)....................... 80 87,800
8.25%, 11/01/11.......................... 190 208,525
XTO Energy, Inc.
6.25%, 4/15/13........................... 215 223,600
7.50%, 4/15/12........................... 250 279,375
---------------
7,923,300
---------------
Entertainment & Leisure-1.3%
Cinemark USA, Inc.
9.00%, 2/01/13........................... 365 391,462
Premier Parks
9.75%, 6/15/07........................... 165 162,938
Six Flags, Inc.
9.50%, 2/01/09........................... 1,050 1,005,375
9.75%, 4/15/13(b)........................ 85 80,325
Universal City Development Partners
11.75%, 4/01/10(b)....................... 455 514,150
---------------
2,154,250
---------------
Financial-2.3%
Crum & Forster Holdings Corp.
10.375%, 6/15/13(b)...................... 210 229,425
iStar Financial, Inc.
7.00%, 3/15/08........................... 85 88,825
8.75%, 8/15/08........................... 350 393,750
Markel Capital Trust I
Series B
8.71%, 1/01/46(f)........................ 660 676,500
Nationwide CSN Trust
9.875%, 2/15/25(b)....................... 1,000 1,162,100
PXRE Capital Trust I
8.85%, 2/01/27........................... 510 453,900
Western Financial Bank
9.625%, 5/15/12.......................... 420 456,750
Williams Scotsman, Inc.
9.875%, 6/01/07.......................... 550 544,500
---------------
4,005,750
---------------
Food/Beverage-1.1%
Del Monte Food Co.
8.625%, 12/15/12(b)...................... 145 159,137
9.25%, 5/15/11........................... 255 281,137
DIMON, Inc.
7.75%, 6/01/13(b)........................ 110 113,300
Series B
9.625%, 10/15/11......................... 175 195,562
Dole Food Company, Inc.
8.625%, 5/01/09.......................... 255 272,850
8.875%, 3/15/11(b)....................... 145 155,150
--------------------------------------------------------------------------------
12 o ACM Managed Dollar Income Fund
Principal
Amount
(000) U.S. $ Value
--------------------------------------------------------------------------------
Merisant Co.
9.50%, 7/15/13(b)........................ $ 300 $ 322,500
Swift & Co.
10.125%, 10/01/09........................ 345 382,950
---------------
1,882,586
---------------
Gaming-3.4%
Ameristar Casinos, Inc.
10.75%, 2/15/09.......................... 230 262,775
Argosy Gaming Co.
9.00%, 9/01/11........................... 235 256,737
Boyd Gaming Corp.
7.75%, 12/15/12.......................... 255 264,563
Harrah's Operating Company, Inc.
7.875%, 12/15/05......................... 230 249,550
Horseshoe Gaming Holding Corp.
Series B
8.625%, 5/15/09.......................... 195 209,869
MGM Mirage, Inc.
8.375%, 2/01/11.......................... 575 635,375
Mandalay Resort Group
10.25%, 8/01/07.......................... 570 658,350
Mohegan Tribal Gaming
6.375%, 7/15/09(b)....................... 140 141,925
8.375%, 7/01/11.......................... 220 240,900
Park Place Entertainment
7.00%, 4/15/13........................... 305 316,819
7.875%, 3/15/10.......................... 295 317,125
9.375%, 2/15/07.......................... 230 254,725
Riviera Holdings Corp.
11.00%, 6/15/10.......................... 320 318,800
Station Casinos, Inc.
8.375%, 2/15/08.......................... 235 254,681
Trump Holdings and Funding
11.625%, 3/15/10......................... 560 503,300
Turning Stone Casino Resort Enterprise
9.125%, 12/15/10(b)...................... 290 312,838
Venetian Casino Resort, LLC
11.00%, 6/15/10.......................... 610 698,450
---------------
5,896,782
---------------
Healthcare-2.7%
Alliance Imaging, Inc.
10.375%, 4/15/11......................... 425 444,125
AmerisourceBergen Corp.
8.125%, 9/01/08.......................... 190 207,100
Concentra Operating Corp.
9.50%, 8/15/10(b)........................ 200 210,000
13.00%, 8/15/09.......................... 430 479,450
Extendicare Health Services
9.50%, 7/01/10........................... 340 370,600
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 13
Principal
Amount
(000) U.S. $ Value
--------------------------------------------------------------------------------
HCA, Inc.
7.875%, 2/01/11.......................... $ 655 $ 732,268
Hanger Orthopedic Group, Inc.
10.375%, 2/15/09......................... 380 426,075
PacifiCare Health Systems, Inc.
10.75%, 6/01/09.......................... 585 675,675
Select Medical Corp.
7.50%, 8/01/13(b)........................ 390 404,625
Triad Hospitals, Inc.
Series B
8.75%, 5/01/09........................... 455 497,087
11.00%, 5/15/09.......................... 245 270,725
---------------
4,717,730
---------------
Hotels & Lodging-1.7%
Extended Stay America, Inc.
9.875%, 6/15/11.......................... 405 449,044
Felcor Lodging LP
8.50%, 6/01/11........................... 145 155,150
10.00%, 9/15/08.......................... 200 216,000
Host Marriott LP
9.25%, 10/01/07.......................... 105 115,106
9.50%, 1/15/07........................... 330 363,000
La Quinta Corp.
8.875%, 3/15/11(b)....................... 400 435,500
MeriStar Hospitality Corp.
9.125%, 1/15/11.......................... 100 105,500
MeriStar Hospitality Operating Partnership, LP
10.50%, 6/15/09.......................... 210 227,850
Starwood Hotels & Resorts Worldwide, Inc.
7.875%, 5/01/12.......................... 515 566,500
Vail Resorts, Inc.
8.75%, 5/15/09........................... 280 295,750
---------------
2,929,400
---------------
Industrial-2.3%
AMSTED Industries, Inc.
10.25%, 10/15/11(b)...................... 545 588,600
Case New Holland, Inc.
9.25%, 8/01/11(b)........................ 685 739,800
Dayton Superior Corp.
10.75%, 9/15/08(b)....................... 245 252,350
FastenTech, Inc.
11.50%, 5/01/11(b)....................... 350 367,500
Flowserve Corp.
12.25%, 8/15/10.......................... 370 429,200
H&E Equipment/Finance
11.125%, 6/15/12......................... 260 222,300
NMHG Holding Co.
10.00%, 5/15/09.......................... 220 243,100
SPX Corp.
7.50%, 1/01/13........................... 205 216,788
--------------------------------------------------------------------------------
14 o ACM Managed Dollar Income Fund
Principal
Amount
(000) U.S. $ Value
--------------------------------------------------------------------------------
Terex Corp.
10.375%, 4/01/11......................... $ 400 $ 450,000
TriMas Corp.
9.875, 6/15/12........................... 505 515,100
---------------
4,024,738
---------------
Metals/Mining-0.8%
AK Steel Corp.
7.875%, 2/15/09.......................... 1,315 946,799
Peabody Energy Corp.
6.875%, 3/15/13.......................... 410 429,475
---------------
1,376,274
---------------
Paper & Packaging-3.8%
Anchor Glass Container Corp.
11.00%, 2/15/13(b)....................... 45 50,625
11.00%, 2/15/13.......................... 395 444,375
Ball Corp.
6.875%, 12/15/12......................... 1,000 1,036,250
Berry Plastics Corp.
10.75%, 7/15/12.......................... 390 436,800
Constar International, Inc.
11.00%, 12/01/12......................... 140 118,300
Crown Paper Co.
11.00%, 9/01/05(e)....................... 5,000 0
Georgia-Pacific Corp.
9.375%, 2/01/13.......................... 765 857,756
Graphic Packaging Int'l Corp.
9.50%, 8/15/13(b)........................ 655 722,137
Greif Bros. Corp.
8.875%, 8/01/12.......................... 280 304,500
Owens-Brockway Glass Container, Inc.
8.875%, 2/15/09.......................... 795 850,650
Plastipak Holdings, Inc.
10.75%, 9/01/11.......................... 275 302,500
Pliant Corp.
11.125%, 9/01/09(b)...................... 385 412,913
Russell-Stanley Holdings, Inc.
9.00%, 11/30/08(b)(f)(g)................. 782 359,596
Stone Container Corp.
9.25%, 2/01/08........................... 535 584,488
9.75%, 2/01/11........................... 12 13,140
---------------
6,494,030
---------------
Publishing-2.0%
American Media, Inc.
8.875%, 1/15/11.......................... 105 113,006
10.25%, 5/01/09.......................... 500 536,875
Dex Media East LLC
9.875%, 11/15/09......................... 110 125,125
12.125%, 11/15/12........................ 320 388,000
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 15
Principal
Amount
(000) U.S. $ Value
--------------------------------------------------------------------------------
Dex Media West LLC
8.50%, 8/15/10(b)........................ $ 160 $ 174,800
9.875%, 8/15/13(b)....................... 625 709,375
Hollinger International Publishing, Inc.
9.00%, 12/15/10.......................... 530 561,137
Houghton Mifflin Co.
8.25%, 2/01/11........................... 280 294,700
9.875%, 2/01/13.......................... 100 106,500
PEI Holdings, Inc.
11.00%, 3/15/10.......................... 205 227,550
RH Donnelley, Inc.
10.875%, 12/15/12(b)..................... 255 302,175
---------------
3,539,243
---------------
Restaurants-0.2%
Domino's Inc.
8.25%, 7/01/11(b)........................ 350 371,437
---------------
Retail-0.8%
J.C. Penney Corporation, Inc.
8.00%, 3/01/10........................... 490 540,225
Payless ShoeSource, Inc.
8.25%, 8/01/13(b)........................ 500 510,000
Saks, Inc.
8.25%, 11/15/08.......................... 290 319,000
---------------
1,369,225
---------------
Service-2.6%
Allied Waste North America
8.50%, 12/01/08.......................... 85 92,225
8.875%, 4/01/08.......................... 645 701,438
10.00%, 8/01/09.......................... 1,230 1,339,162
Coinmach Corp.
9.00%, 2/01/10........................... 250 267,500
Corrections Corp. of America
7.50%, 5/01/11........................... 40 41,450
9.875%, 5/1/09........................... 280 315,700
Iron Mountain, Inc.
7.75%, 1/15/15........................... 115 119,313
8.625%, 4/01/13.......................... 350 374,500
National Waterworks, Inc.
10.50%, 12/01/12......................... 235 257,913
Service Corp. International
6.50%, 3/15/08........................... 240 238,800
7.70%, 4/15/09........................... 240 246,600
United Rentals, Inc.
10.75%, 4/15/08(b)....................... 200 222,500
10.75%, 4/15/08.......................... 205 228,062
---------------
4,445,163
---------------
--------------------------------------------------------------------------------
16 o ACM Managed Dollar Income Fund
Principal
Amount
(000) U.S. $ Value
--------------------------------------------------------------------------------
Supermarket & Drugstore-1.0%
Pathmark Stores, Inc.
8.75%, 2/01/12........................... $ 310 $ 319,300
8.75%, 2/01/12(b)........................ 185 189,625
Rite Aid Corp.
9.25%, 6/01/13(b)........................ 75 79,875
9.50%, 2/15/11........................... 660 749,100
Roundy's, Inc.
Series B
8.875%, 6/15/12.......................... 270 283,500
Stater Bros. Holdings, Inc.
10.75%, 8/15/06.......................... 150 157,875
---------------
1,779,275
---------------
Technology-1.7%
Cooporative Computing, Inc.
10.50%, 6/15/11(b)....................... 305 330,925
Fairchild Semiconductor
10.50%, 2/01/09.......................... 505 564,337
ON Semiconductor Corp.
12.00%, 3/15/10.......................... 715 841,913
Unisys Corp.
6.875%, 3/15/10.......................... 1,000 1,045,000
7.875%, 4/01/08.......................... 185 193,325
---------------
2,975,500
---------------
Utilities - Electric & Gas-1.9%
AES Corporation
8.75%, 5/15/13(b)........................ 65 68,575
9.00%, 5/15/15(b)........................ 105 111,562
10.00%, 7/15/05(b)....................... 290 300,150
Calpine Corp.
8.50%, 7/15/10(b)........................ 1,580 1,461,500
PG&E Corp.
6.875%, 7/15/08(b)....................... 395 416,725
SEMCO Energy, Inc.
7.125%, 5/15/08(b)....................... 125 126,250
7.75%, 5/15/13(b)........................ 235 237,938
The Williams Companies, Inc.
8.625%, 6/01/10.......................... 485 517,738
---------------
3,240,438
---------------
Total U.S. Corporate Debt Obligations
(cost $94,979,445) ...................... 87,252,459
---------------
NON-U.S. CORPORATE DEBT OBLIGATIONS-10.9%
Argentina-0.2%
Supercanal Holdings, SA
10.75%, 11/07/02(e)(f)................... 3,478 417,315
---------------
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 17
Principal
Amount
(000) U.S. $ Value
--------------------------------------------------------------------------------
Bahamas-0.2%
Sun International Hotels, Ltd.
8.875%, 8/15/11 ......................... $ 245 $ 266,744
---------------
Canada-0.6%
Fairfax Financial Holdings
7.375%, 4/15/18.......................... 250 225,000
Intrawest Corp.
9.75%, 8/15/08........................... 220 232,375
10.50%, 2/01/10.......................... 150 166,312
Norske Skog Canada, Ltd.
Series D
8.625%, 6/15/11.......................... 335 350,494
---------------
974,181
---------------
Cayman Islands-0.8%
PF Export Receivables Master Trust
6.436%, 6/01/15(b)....................... 1,462 1,454,918
---------------
France-0.3%
Crown Euro Holdings S.A.
9.50%, 3/01/11(b)........................ 405 437,400
---------------
Great Britian-0.3%
Danka Business Systems
11.00%, 6/15/10(b)....................... 95 87,875
Royal & Sun Alliance Insurance Group PLC
8.95%, 10/15/29.......................... 450 408,162
---------------
496,037
---------------
Ireland-0.4%
Eircom Funding
8.25%, 8/15/13(b)........................ 245 264,600
MDP Acquisitions PLC
9.625%, 10/01/12......................... 390 429,000
---------------
693,600
---------------
Kazakhstan-0.7%
Hurricane Finance BV
9.625%, 2/12/10(b)....................... 400 436,000
Kazkommerts International BV
8.50%, 4/16/13(b)........................ 850 830,875
---------------
1,266,875
---------------
Liberia-0.4%
Royal Caribbean Cruises, Ltd.
8.00%, 5/15/10........................... 625 662,500
---------------
Luxembourg-1.3%
Mobile Telesystems Finance S.A.
10.95%, 12/21/04......................... 2,130 2,273,775
---------------
--------------------------------------------------------------------------------
18 o ACM Managed Dollar Income Fund
Shares or
Principal
Amount
(000) U.S. $ Value
--------------------------------------------------------------------------------
Mexico-4.2%
Innova S. de R.L.
9.375%, 9/19/13(b)....................... $ 2,865 $ 2,897,231
12.875%, 4/01/07......................... 4,275 4,424,625
---------------
7,321,856
---------------
Romania-0.3%
Mobifon Holdings BV
12.50%, 7/31/10(b)....................... 425 465,375
---------------
Russia-1.0%
Gazprom OAO
9.625%, 3/01/13(b)....................... 1,000 1,076,875
Tyumen Oil Company
11.00%, 11/06/07(b)...................... 550 615,000
---------------
1,691,875
---------------
Singapore-0.2%
Flextronics International, Ltd.
6.50%, 5/15/13(b)........................ 425 423,937
---------------
Total Non-U.S. Corporate Debt Obligations
(cost $20,782,877)....................... 18,846,388
---------------
CONVERTIBLE PREFERRED STOCK-0.0%
PSINet, Inc.
7.00%(b)(e).............................. 15,000 0
---------------
Total Convertible Preferred Stock
(cost $600,000).......................... 0
---------------
NON-CONVERTIBLE PREFERRED
STOCKS-1.5%
CSC Holdings, Inc.
Series M
11.125%.................................. 12,187 1,276,588
Sovereign Real Estate Investment Trust
12.00%(b)................................ 870 1,287,600
---------------
Total Non-Convertible Preferred Stocks
(cost $1,973,483)........................ 2,564,188
---------------
COMMON STOCK & WARRANTS-0.0%
Central Bank of Nigeria
Warrants, expiring 11/15/20(h)........... 1,000 0
Republic of Venezuela
Warrants, expiring 4/15/20(h)............ 7,140 0
Russell-Stanley Holdings, Inc.
Common Stock(h)(i)....................... 100,000 1
---------------
Total Common Stock & Warrants
(cost $0)................................ 1
---------------
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 19
Contract
Amount(j) U.S. $ Value
--------------------------------------------------------------------------------
CALL OPTION PURCHASED(h)-0.0%
Federal Republic of Brazil C-Bonds
Expiring Oct '03 @ 90.9375
(cost $24,782)........................... 2,154,968 $ 34,479
---------------
Total Investments Before Security
Lending Collateral-130.4%
(cost $202,823,027)...................... 225,833,622
Investment of Cash Collateral for
Securities Loaned*-2.1%
Short-Term Investment Shares
---------------
UBS Private Money Market Fund, LLC
1.03%
(cost $3,594,750)........................ 3,594,750 3,594,750
---------------
Total Investments-132.5%
(cost $206,417,777)...................... 229,428,372
Other assets less liabilities-(32.5)%....... (56,246,705)
---------------
Net Assets-100.0%........................... $ 173,181,667
===============
* See Note F for securities lending information.
CREDIT DEFAULT SWAP CONTRACTS (see Note C)
Notional Unrealized
Swap Counterparty Amount Interest Termination Appreciation/
Referenced Obligation (000) Rate Date (Depreciation)
--------------------------------------------------------------------------------
Buy Contracts:
Deutsche Bank A.G. London
Federal Republic of Peru
9.875%, 2/06/15 700 3.90% 12/20/08 $ (4,760)
JP Morgan Chase
Federal Republic of Venezuela
1.875%, 12/18/07 1,050 5.00 9/20/04 (10,395)
Sales Contracts:
Citigroup Global Markets, Inc.
Federal Republic of Brazil
12.25%, 3/06/30 1,000 6.35 8/20/05 33,300
Deutsche Bank A.G. London
Federal Republic of Brazil
12.25%, 3/06/30 600 17.85 2/06/08 219,420
Deutsche Bank A.G. London
Federal Republic of Brazil
12.25%, 3/06/30 1,500 14.50 3/08/08 374,550
--------------------------------------------------------------------------------
20 o ACM Managed Dollar Income Fund
CREDIT DEFAULT SWAP CONTRACTS (see Note C) (continued)
Notional Unrealized
Swap Counterparty Amount Interest Termination Appreciation/
Referenced Obligation (000) Rate Date (Depreciation)
--------------------------------------------------------------------------------
Sales Contracts (continued):
Deutsche Bank A.G. London
Federal Republic of Romania
8.50%, 5/08/12 1,550 3.55% 4/03/10 $ 105,865
JP Morgan Chase
Federal Republic of Venezuela
1.875%, 12/18/07 1,050 7.70 9/20/06 7,770
JP Morgan Chase
Federal Republic of Brazil
8.00%, 4/15/14 500 8.60 9/20/08 20,550
JP Morgan Chase
Federal Republic of Brazil
8.00%, 4/15/14 500 9.05 9/20/13 44,800
JP Morgan Chase
Federal Republic of Brazil
8.00%, 4/15/14 2,000 9.34 9/20/13 179,200
REVERSE REPURCHASE AGREEMENTS (see Note C)
Interest
Broker Rate Maturity Amount
--------------------------------------------------------------------------------
Deutsche Bank 1.05% 10/01/03 $15,184,024
Deutsche Bank 1.10 10/01/03 945,029
Deutsche Bank 0.25 12/31/03 2,641,922
Deutsche Bank 0.45 12/31/03 2,103,471
Deutsche Bank 1.05 12/31/03 13,005,379
Deutsche Bank 1.10 12/31/03 26,730,084
JP Morgan Chase 0.95 12/31/03 4,408,567
Lehman Brothers 0.15 12/31/03 1,154,628
Lehman Brothers 0.25 12/31/03 6,180,215
Lehman Brothers 0.75 12/31/03 1,124,179
Lehman Brothers 0.85 12/31/03 1,322,123
-----------
$74,799,621
===========
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 21
(a) Coupon changes periodically based upon a predetermined schedule. Stated
interest rate in effect at September 30, 2003.
(b) Security is 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 September 30,
2003, the aggregate market value of these securities amounted to $85,971,468
or 50% of net assets.
(c) Positions, or portions thereof, with an aggregate market value of
$73,502,438 have been segregated to collateralize reverse repurchase
agreements.
(d) Indicates a security that has a zero coupon that remains in effect until a
predetermined date at which time the stated coupon rate becomes effective
until final maturity.
(e) Security is in default and is non-income producing.
(f) Illiquid security, valued at fair market value (see Note A).
(g) Coupon is paid in-kind.
(h) Non-income producing security.
(i) Common stock, par value is $0.01 per share.
(j) One contract relates to principal amount of $1.00.
Glossary of Terms:
DCB -Debt Conversion Bond
FLIRB -Front Loaded Interest Reduction Bond
FRN -Floating Rate Note
VRN -Variable Rate Note
See notes to financial statements.
--------------------------------------------------------------------------------
22 o ACM Managed Dollar Income Fund
STATEMENT OF ASSETS & LIABILITIES
September 30, 2003
Assets
Investments in securities, at value (cost $206,417,777)
--including investment of cash collareral for securities
loaned of $3,594,750.................................. $ 229,428,372(a)
Cash.................................................... 692,783
Due from broker......................................... 13,005,000
Interest and dividends receivable....................... 5,567,390
Receivable for investment securities sold............... 4,870,809
Unrealized appreciation on credit default
swap contracts........................................ 985,455
Paydown receivable...................................... 177,327
Other assets............................................ 14,010
-------------
Total assets............................................ 254,741,146
-------------
Liabilities
Reverse repurchase agreements........................... 74,799,621
Payable for collateral on securities loaned............. 3,594,750
Payable for investment securities purchased............. 2,858,382
Advisory fee payable.................................... 112,173
Administrative fee payable.............................. 22,433
Unrealized depreciation on credit default
swap contracts........................................ 15,155
Accrued expenses and other liabilities.................. 156,965
-------------
Total liabilities....................................... 81,559,479
-------------
Net Assets.............................................. $ 173,181,667
=============
Composition of Net Assets
Common stock, at par.................................... $ 225,406
Additional paid-in capital.............................. 296,111,267
Distributions in excess of net investment income........ (123,407)
Accumulated net realized loss on investment
transactions.......................................... (147,012,494)
Net unrealized appreciation of investments.............. 23,980,895
-------------
$ 173,181,667
=============
Net Asset Value Per Share
(based on 22,540,621 shares outstanding)............. $7.68
=====
(a) Includes securities on loan with a value of $3,420,869 (see Note F).
See notes to financial statements.
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 23
STATEMENT OF OPERATIONS
Year Ended September 30, 2003
Investment Income
Interest............................... $ 20,898,974
Dividends.............................. 43,912 $ 20,942,886
---------------
Expenses
Advisory fee........................... 1,154,590
Administrative fee..................... 230,916
Printing............................... 126,309
Custodian.............................. 98,912
Audit and legal........................ 98,072
Transfer agency........................ 51,746
Directors' fees........................ 38,548
Registration fees...................... 24,938
Miscellaneous.......................... 45,797
---------------
Total expenses before interest......... 1,869,828
Interest expense....................... 779,443
---------------
Total expenses......................... 2,649,271
---------------
Net investment income.................. 18,293,615
---------------
Realized and Unrealized Gain (Loss) on
Investment Transactions
Net realized gain (loss) on:
Investment transactions............. 3,255,229
Swap contracts...................... (191,781)
Written options..................... 120,834
Net change in unrealized appreciation/
depreciation of:
Investments......................... 42,802,435
Swap contracts...................... 970,300
---------------
Net gain on investment transactions.... 46,957,017
---------------
Net Increase in Net Assets
from Operations...................... $ 65,250,632
===============
See notes to financial statements.
--------------------------------------------------------------------------------
24 o ACM Managed Dollar Income Fund
STATEMENT OF CHANGES IN NET ASSETS
Year Ended Year Ended
September 30, September 30,
2003 2002
--------------- ---------------
Increase (Decrease) in Net Assets
from Operations
Net investment income.................. $ 18,293,615 $ 18,676,310
Net realized gain (loss) on investment
transactions......................... 3,184,282 (30,457,612)
Net change in unrealized
appeciation/depreciation
of investments....................... 43,772,735 14,551,799
--------------- ---------------
Net increase in net assets
from operations...................... 65,250,632 2,770,497
Dividends and Distributions to
Shareholders from
Net investment income.................. (18,177,141) (18,835,190)
Tax return of capital.................. -0- (730,704)
Common Stock Transactions
Reinvestment of dividends resulting in
the issuance of Common Stock......... 1,273,690 1,520,333
--------------- ---------------
Total increase (decrease).............. 48,347,181 (15,275,064)
Net Assets
Beginning of period.................... 124,834,486 140,109,550
--------------- ---------------
End of period.......................... $ 173,181,667 $ 124,834,486
=============== ===============
See notes to financial statements.
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 25
STATEMENT OF CASH FLOWS
Year Ended September 30, 2003
Increase (Decrease) in Cash from
Operating Activities:
Interest and dividends received........ $ 17,558,683
Interest expense paid.................. (1,014,107)
Operating expenses paid................ (1,852,491)
---------------
Net increase in cash from
operating activities................. $ 14,692,085
Investing Activities:
Purchases of long-term investments..... (168,937,890)
Proceeds from disposition of
long-term investments................ 162,118,133
Proceeds from disposition of
short-term investments, net.......... 247,250
Cash collateral received on
securities loaned.................... 3,594,750
Net premium received on
option transactions.................. 39,607
Net premium paid on swaps
transactions......................... (191,781)
---------------
Net decrease in cash from
investing activities................. (3,129,931)
Financing Activities:*
Cash dividends paid.................... (16,903,451)
Proceeds from reverse repurchase
agreements........................... 6,033,839
---------------
Net decrease in cash from
financing activities................. (10,869,612)
---------------
Net increase in cash................... 692,542
Cash at beginning of period............ 241
---------------
Cash at end of period.................. $ 692,783
===============
--------------------------------------------------------------------------------
Reconciliation of Net Increase in Net
Assets from Operations to Net Increase
in Cash from Operating Activities:
Net increase in net assets from
operations........................... $ 65,250,632
Adjustments:
Increase in dividends and
interest receivable.................. $ (1,031,452)
Accretion of bond discount and
amortization of bond premium......... (2,352,751)
Increase in accrued expenses
and other assets..................... 17,337
Decrease in interest payable........... (234,664)
Net realized loss on investment
transactions......................... (3,184,282)
Net change in unrealized
appreciation/depreciation
of investments....................... (43,772,735)
---------------
Total adjustments...................... (50,558,547)
---------------
Net Increase in Cash from
Operating Activities................... $ 14,692,085
===============
* Non-cash financing activities not included herein consist of reinvestment of
dividends and distributions.
See notes to financial statements.
--------------------------------------------------------------------------------
26 o ACM Managed Dollar Income Fund
NOTES TO FINANCIAL STATEMENTS
September 30, 2003
NOTE A
Significant Accounting Policies
ACM Managed Dollar Income Fund, Inc. (the "Fund") was incorporated under the
laws of the State of Maryland on August 10, 1993 and is registered under the
Investment Company Act of 1940 as a non-diversified, closed-end management
investment company. The financial statements have been prepared in conformity
with accounting principles generally accepted in the United States, which
requires management to make certain estimates and assumptions that affect the
reported amounts of assets and liabilities in the financial statements and
amounts of income and expenses during the reporting period. Actual results could
differ from those estimates. The following is a summary of significant
accounting policies followed by the Fund.
1. Security Valuation
In accordance with Pricing Policies adopted by the Board of Directors of the
Fund (the "Pricing Policies") and applicable law, portfolio securities are
valued at current market value or at fair value. The Board of Directors has
delegated to the Adviser, subject to the Board's continuing oversight, certain
responsibilities with respect to the implementation of the Pricing Policies.
Pursuant to the Pricing Policies, securities for which market quotations are
readily available are valued at their current market value. In general, the
market value of these securities is determined as follows:
Securities listed on a national securities exchange or on a foreign securities
exchange are valued at the last sale price at the close of the exchange or
foreign securities exchange. If there has been no sale on such day, the
securities are valued at the mean of the closing bid and asked prices on such
day. If no bid or asked prices are quoted on such day, then the security is
valued in good faith at fair value in accordance with the Pricing Policies.
Securities listed on more than one exchange are valued by reference to the
principal exchange on which the securities are traded; securities not listed on
an exchange but traded on The Nasdaq Stock Market, Inc. ("NASDAQ") are valued in
accordance with the NASDAQ Official Closing Price; listed put or call options
are valued at the last sale price. If there has been no sale on that day, such
securities will be valued at the closing bid prices on that day; open futures
contracts and options thereon are valued using the closing settlement price or,
in the absence of such a price, the most recent quoted bid price. If there are
no quotations available for the day of valuations, the last available closing
settlement price is used; securities traded in the over-the-counter market, (but
excluding securities traded on NASDAQ) are valued at the mean of the current bid
and asked prices as reported by the National Quotation Bureau or other
comparable sources; U.S. Government securities and other debt instruments having
60 days or less remaining until maturity are valued at amortized cost if their
original maturity was 60 days or less, or by amortizing their fair value as of
the 61st day prior to maturity if their original term to maturity exceeded 60
days; fixed-income securities, including
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 27
mortgage backed and asset backed securities, may be valued on the basis of
prices provided by a pricing service or at a price obtained from one or more of
the major broker/dealers. In cases where broker/dealer quotes are obtained, the
Pricing Policies provide that the Adviser may establish procedures whereby
changes in market yields or spreads are used to adjust, on a daily basis, a
recently obtained quoted price on a security; and OTC and other derivatives are
valued on the basis of a quoted bid price or spread from a major broker/dealer
in such security. Securities for which market quotations are not readily
available are valued at fair value in accordance with the Pricing Policies.
2. Taxes
It is the Fund's policy to meet the requirements of the Internal Revenue Code
applicable to regulated investment companies and to distribute substantially all
of its investment company taxable income and net realized gains, if any, to
shareholders. Therefore, no provisions for federal income or excise taxes are
required.
3. Investment Income and Investment Transactions
Interest income is accrued daily. Dividend income is recorded on the ex-dividend
date. Investment transactions are accounted for on the date the securities are
purchased or sold. Investment gains and losses are determined on the identified
cost basis. The Fund accretes discounts as adjustments to interest income.
Additionally, the Fund amortizes premiums on debt securities for financial
statement reporting purposes only.
4. 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 conformity with
accounting principles generally accepted in the United States. 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.
5. Repurchase Agreements
The Fund's custodian or designated subcustodian will take control of securities
as collateral under repurchase agreements and determine on a daily basis that
the value of such securities are sufficient to cover the value of the repurchase
agreements. If the seller defaults and the value of collateral declines, or if
bankruptcy proceedings are commenced with respect to the seller of the security,
realization of collateral by the Fund may be delayed or limited.
NOTE B
Advisory, Administrative Fees and Other Transactions with Affiliates
Under the terms of an Investment Advisory Agreement, the Fund pays Alliance
Capital Management L.P. (the "Adviser") an advisory fee at an annual rate of
--------------------------------------------------------------------------------
28 o ACM Managed Dollar Income Fund
..75 of 1% of the average adjusted weekly net assets of the Fund. Such fee is
accrued daily and paid monthly.
Under the terms of a Shareholder Inquiry Agency Agreement with Alliance Global
Investor Services, Inc. (AGIS), a wholly-owned subsidiary of the Adviser, the
Fund reimburses AGIS for costs relating to servicing phone inquiries on behalf
of the Fund. During the year ended September 30, 2003, the Fund reimbursed to
AGIS $1,130.
Under the terms of an Administration Agreement, the Fund pays Princeton
Administrators, L.P. (the "Administrator") a fee at an annual rate of .15 of 1%
of the average adjusted weekly net assets of the Fund. Such fee is accrued daily
and paid monthly. The Administrator prepares certain financial and regulatory
reports for the Fund and provides clerical and other services.
NOTE C
Investment Transactions
Purchases and sales of investment securities (excluding short-term investments)
for the year ended September 30, 2003, were as follows:
Purchases Sales
--------------- ---------------
Investment securities (excluding
U.S. government securities)......... $ 169,585,665 $ 163,816,231
U.S. government securities............. -0- -0-
The cost of investments for federal income tax purposes, gross unrealized
appreciation and unrealized depreciation (excluding swap contracts) are as
follows:
Cost.................................................... $ 207,214,925
===============
Gross unrealized appreciation........................... $ 40,637,969
Gross unrealized depreciation........................... (18,424,522)
---------------
Net unrealized appreciation............................. $ 22,213,447
===============
1. Option Transactions
For hedging and investment purposes, the Fund may purchase and write (sell) put
and call options on U.S. and foreign government securities and foreign
currencies that are traded on U.S. and foreign securities exchanges and
over-the-counter markets.
The risk associated with purchasing an option is that the Fund pays a premium
whether or not the option is exercised. Additionally, the Fund bears the risk of
loss of the premium and a change in market value should the counterparty not
perform under the contract. Put and call options purchased are accounted for in
the same manner as portfolio securities. The cost of securities acquired through
the exercise of call options is increased by the premiums paid. The proceeds
from securities sold through the exercise of put options are decreased by the
premiums paid.
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 29
When the Fund writes an option, the premium received by the Fund is recorded as
a liability and is subsequently adjusted to the current market value of the
option written. Premiums received from written options which expire unexercised
are recorded by the Fund on the expiration date as realized gains from options
written. The difference between the premium received and the amount paid on
effecting a closing purchase transaction, including brokerage commissions, is
also treated as a realized gain, or if the premium received is less than the
amount paid for the closing purchase transaction, as a realized loss. If a call
option is exercised, the premium received is added to the proceeds from the sale
of the underlying security or currency in determining whether the Fund has
realized a gain or loss. If a put option is exercised, the premium received
reduces the cost basis of the security or currency purchased by the Fund. In
writing an option, the Fund bears the market risk of an unfavorable change in
the price of the security or currency underlying the written option. Exercise of
an option written by the Fund could result in the Fund selling or buying a
security or currency at a price different from the current market value.
Transactions in written options for the year ended September 30, 2003 were as
follows:
Number of
Contracts Premiums
(000) Received
--------------- ---------------
Options outstanding at
September 30, 2002................... -0- $ -0-
Options written........................ 95,826 125,734
Options terminated in closing purchase
transactions......................... (31,628) (41,392)
Options expired........................ (64,198) (84,342)
--------------- ---------------
Options outstanding at
September 30, 2003................... -0- $ -0-
=============== ===============
2. Swap Agreements
The Fund may enter into swaps on sovereign debt obligations to hedge its
exposure to interest rates and credit risk or 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 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 the counterparty to the swap
contract 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 creditworthiness of each counterparty to a swap
contract in
--------------------------------------------------------------------------------
30 o ACM Managed Dollar Income Fund
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
interest income or expense expected to be received or paid in the interest
period. 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 a component of net
change in unrealized appreciation/depreciation of investments. Realized gains
and/or losses from terminated swap contracts are included in net realized gain
or loss on investment transactions.
The Fund may enter into credit default swaps. A sell/(buy) in a credit default
swap provides, upon the occurrence of a credit event, as defined in the swap
agreement, for the Fund to buy/(sell) from/(to) the counterparty at par and
take/(deliver) the principal amount (the "Notional Amount") of the referenced
obligation. During the term of the swap agreement, the Fund receives/(pays)
semi-annual fixed interest payments from/(to) the respective counterparty,
calculated at the agreed upon interest rate applied to the Notional Amount.
Credit default swaps may involve greater risks than if a Fund had invested in
the referenced obligation directly. Credit default swaps are subject to general
market risk, liquidity risk and credit risk. If the Fund is a buyer and no
credit event occurs, it will lose its investment. In addition, the value of the
referenced obligation received by the Fund as a seller if a credit event occurs,
coupled with the periodic payments previously received, may be less than the
full notional value it pays to the buyer, resulting in a loss of value to the
Fund.
3. Reverse Repurchase Agreements
Under a reverse repurchase agreement, the Fund sells securities and agrees to
repurchase them at a mutually agreed upon date and price. At the time the Fund
enters into a reverse repurchase agreement, it will establish a segregated
account with the custodian containing liquid assets having a value at least
equal to the repurchase price.
"Due from broker" shown on the statement of assets and liabilities represents
the receivable from the respective broker for the reverse repurchase agreement
entered into on September 30, 2003.
For the year ended September 30, 2003, the average amount of reverse repurchase
agreements outstanding was $60,189,635 and the daily weighted average annual
interest rate was 1.28%.
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 31
NOTE D
Capital Stock
There are 300,000,000 shares of $.01 par value common stock authorized of which
22,540,621 shares were issued and outstanding at September 30, 2003. During the
years ended September 30, 2003 and September 30, 2002, the Fund issued 182,814
and 223,517 shares, respectively, in connection with the Fund's dividend
reinvestment plan.
NOTE E
Concentration of Risk
Investing in securities of foreign companies and foreign governments involves
special risks which include changes in foreign exchange rates and the
possibility of future political and economic development which could adversely
affect the value of such securities. Moreover, securities of many foreign
companies and foreign governments and their markets may be less liquid and their
prices more volatile than those of comparable U.S. companies and the United
States Government.
The Fund invests in 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 economies 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.
NOTE F
Securities Lending
The Fund has entered into a securities lending agreement with AG Edwards & Sons,
Inc. (the "Lending Agent"). Under the terms of the agreement, the Lending Agent,
on behalf of the Fund, administers the lending of portfolio securities to
certain broker-dealers. In return, the Fund receives fee income from the lending
transactions or it retains a portion of interest on the investment of any cash
received as collateral. The Fund also continues to receive dividends or interest
on the securities loaned. Unrealized gain or loss on the value of the securities
loaned that may occur during the term of the loan will be reflected in the
accounts of the Fund. All loans are continuously secured by collateral exceeding
the value of the securities loaned. All collateral consists of either cash or
U.S. Government securities. The Lending Agent may invest the cash collateral
received in accordance with the investment restrictions of the Fund in one or
more of the following investments: U.S. Government or U.S. Government agency
obligations, bank obligations, corporate debt obligations, asset-backed
securities, structured products, repurchase agreements and an eligible money
market fund. The Lending Agent will indemnify the Fund for any loss resulting
from a borrower's failure to return a loaned security when due. As of September
30, 2003, the Fund had loaned securities with a value of $3,420,869 and
--------------------------------------------------------------------------------
32 o ACM Managed Dollar Income Fund
received cash collateral of $3,594,750, which was invested in a money market
fund as included in the portfolio of investments. For the year ended September
30, 2003, the Fund earned fee income of $10,189, which is included in interest
income in the accompanying statement of operations.
NOTE G
Distributions to Shareholders
The tax character of distributions paid to shareholders during the fiscal years
ended September 30, 2003 and September 30, 2002 were as follows:
2003 2002
-------------- ---------------
Distributions paid from:
Ordinary income.................... $ (18,177,141) $ (18,835,190)
-------------- ---------------
Total taxable distributions........... (18,177,141) (18,835,190)
Tax return of capital.............. -0- (730,704)
-------------- ---------------
Total distributions paid.............. $ (18,177,141) $ (19,565,894)
============== ===============
As of September 30, 2003, the components of accumulated earnings/(deficit) on a
tax basis were as follows:
Undistributed ordinary income.......................... $ 124,846
Accumulated capital and other losses................... (146,463,599)(a)
Unrealized appreciation/(depreciation)................. 23,183,747(b)
---------------
Total accumulated earnings/(deficit)................... $ (123,155,006)
===============
(a) On September 30, 2003, the Fund had a net capital loss carryforward of
$146,463,599 of which $57,455,739 expires in the year 2007, $24,635,181
expires in the year 2008, $10,899,598 expires in the year 2009, $33,249,705
expires in 2010 and $20,223,376 expires in the year 2011. To the extent
future capital gains are offset by capital loss carryforwards, such gains
will not be distributed.
(b) The difference between book-basis and tax-basis unrealized
appreciation/(depreciation) is attributable primarily to the tax deferral of
losses on wash sales and the difference between book and tax amortization
methods for premium.
During the current fiscal year, permanent differences, primarily due to the tax
treatment of bond premium and the tax character of paydown gains, resulted in a
net increase in distributions in excess of net investment income and a decrease
in accumulated net realized loss on investment transactions. This
reclassification had no effect on net assets.
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 33
FINANCIAL HIGHLIGHTS
Selected Data For A Share Of Common Stock Outstanding Throughout Each Period
Year Ended September 30,
--------------------------------------------------------
2003 2002(a) 2001 2000 1999
--------------------------------------------------------
Net asset value,
beginning of period..... ........... $ 5.58 $ 6.33 $ 8.09 $ 8.39 $ 8.18
--------------------------------------------------------
Income From Investment
Operations
Net investment income(b) ............. .81 .84 .98 1.08 1.25
Net realized and unrealized
gain (loss) on investment
transactions............ ........... 2.10 (.71) (1.72) (.22) .34
--------------------------------------------------------
Net increase (decrease)
in net asset value from
operations.............. ........... 2.91 .13 (.74) .86 1.59
--------------------------------------------------------
Less: Dividends and
Distributions
Dividends from net investment
income.................. ........... (.81) (.85) (.95) (1.02) (1.25)
Distributions in excess of
net investment income... ........... -0- -0- -0- -0- (.13)
Tax return of capital... ............. -0- (.03) (.07) (.14) -0-
--------------------------------------------------------
Total dividends and
distributions........... ........... (.81) (.88) (1.02) (1.16) (1.38)
--------------------------------------------------------
Net asset value,
end of period........... ........... $ 7.68 $ 5.58 $ 6.33 $ 8.09 $ 8.39
========================================================
Market value, end of period .......... $ 8.15 $ 6.29 $ 7.62 $ 8.50 $ 10.25
========================================================
Premium/(Discount)...... ............. 6.12% 12.72% 20.38% 5.07% 22.17%
Total Return
Total investment return
based on:(c)
Market value.......... ............. 45.71% (6.14)% 3.02% (5.41)% 27.06%
Net asset value....... ............. 54.77% .23% (10.08)% 9.99% 18.69%
Ratios/Supplemental Data
Net assets, end of period
(000's omitted)......... ........... $173,182 $124,834 $140,110 $179,653 $184,618
Ratios to average net assets of:
Expenses.............. ............. 1.72% 2.12% 2.75% 2.70% 2.46%
Expenses, excluding
interest expense(d)... ........... 1.21% 1.15% 1.13% 1.09% 1.11%
Net investment income. ............. 11.88% 10.81% 9.90% 9.55% 11.27%
Portfolio turnover rate. ............. 80% 63% 129% 134% 223%
See footnote summary on page 35.
--------------------------------------------------------------------------------
34 o ACM Managed Dollar Income Fund
(a) As required, effective October 1, 2001, the Fund has adopted the provisions
of the AICPA Audit and Accounting Guide, Audits of Investment Companies, and
began amortizing premium on debt securities for financial statement
reporting purposes only. The effect of this change for the year ended
September 30, 2002 was to decrease net investment income per share by $0.01,
decrease net realized and unrealized loss on investment by $0.01 and
decrease the ratio of net investment income to average net assets from
10.91% to 10.81%. Per share, ratios and supplemental data for periods prior
to October 1, 2001 have not been restated to reflect this change in
presentation.
(b) Based on average shares outstanding.
(c) 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
each 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.
(d) Net of interest expense of .51%, .97%, 1.62%, 1.61%, and 1.35%,
respectively, on borrowings.
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 35
REPORT OF ERNST & YOUNG LLP
INDEPENDENT AUDITORS
To the Shareholders and Board of Directors of ACM Managed Dollar Income Fund,
Inc.
We have audited the accompanying statement of assets and liabilities of ACM
Managed Dollar Income Fund, Inc. (the "Fund"), including the portfolio of
investments, as of September 30, 2003, and the related statements of operations
and cash flows 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 five years in the period then ended. These financial statements
and financial highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. 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 and financial highlights. Our procedures included
confirmation of securities owned as of September 30, 2003, by correspondence
with the custodian and others. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement 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 ACM
Managed Dollar Income Fund, Inc. at September 30, 2003, the results of its
operations and its cash flows 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 five years in the period then ended, in conformity
with accounting principles generally accepted in the United States.
/s/ Ernst & Young LLP
New York, New York
November 14, 2003
TAX INFORMATION (unaudited)
For the fiscal year ended September 30, 2003 certain dividends paid by the Fund
may be subject to a maximum tax rate of 15%, as provided for by the Jobs and
Growth Tax Relief Reconciliation Act of 2003. The Fund designates a maximum
amount of $43,912 as qualified dividend income, which is taxed at a maximum rate
of 15%. The information and distributions reported herein may differ from the
information and distributions taxable to the shareholders for the calendar year
ending December 31, 2003. Complete information will be computed and reported in
conjunction with year 2003 Form 1099-DIV.
--------------------------------------------------------------------------------
36 o ACM Managed Dollar Income Fund
ADDITIONAL INFORMATION
(unaudited)
Shareholders whose shares are registered in their own names may elect to be
participants in the Dividend Reinvestment and Cash Purchase Plan (the "Plan"),
pursuant to which dividends and capital gain distributions to shareholders will
be paid in or reinvested in additional shares of the Fund. State Street Bank and
Trust Company (the "Agent") will act as agent for participants under the Plan.
Shareholders whose shares are held in the name of a broker or nominee should
contact such broker or nominee to determine whether or how they may participate
in the Plan.
If the Board declares an income distribution or determines to make a capital
gain distribution payable either in shares or in cash, as holders of the Common
Stock may have elected, non-participants in the Plan will receive cash and
participants in the Plan will receive the equivalent in shares of Common Stock
of the Fund valued as follows:
(i) If the shares of Common Stock are trading at net asset value or at a
premium above net asset value at the time of valuation, the Fund will issue
new shares at the greater of net asset value or 95% of the then current
market price.
(ii) If the shares of Common Stock are trading at a discount from net asset
value at the time of valuation, the Plan Agent will receive the dividend or
distribution in cash and apply it to the purchase of the Fund's shares of
Common Stock in the open market on the New York Stock Exchange or elsewhere,
for the participants' accounts. Such purchases will be made on or shortly
after the payment date for such dividend or distribution and in no event more
than 30 days after such date except where temporary curtailment or suspension
of purchase is necessary to comply with Federal securities laws. If, before
the Plan agent has completed its purchases, the market price exceeds the net
asset value of a share of Common Stock, the average purchase price per share
paid by the Plan agent may exceed the net asset value of the Fund's shares of
Common Stock, resulting in the acquisition of fewer shares than if the
dividend or distribution had been paid in shares issued by the Fund.
The Agent will maintain all shareholders' accounts in the Plan and furnish
written confirmation of all transactions in the account, including information
needed by shareholders for tax records. Shares in the account of each Plan
participant will be held by the Agent in non-certificate form in the name of the
participant, and each shareholder's proxy will include those shares purchased or
received pursuant to the Plan.
There will be no charges with respect to shares issued directly by the Fund to
satisfy the dividend reinvestment requirements. However, each participant will
pay a pro-rata share of brokerage commissions incurred with respect to the
Agent's open market purchases of shares. In each case, the cost per share of
shares purchased for each shareholder's account will be the average cost,
including brokerage commissions, of any shares purchased in the open market plus
the cost of any shares issued by the Fund.
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 37
The automatic reinvestment of dividends and distributions will not relieve
participants of any income taxes that may be payable (or required to be
withheld) on dividends and distributions.
Experience under the Plan may indicate that changes are desirable. Accordingly,
the Fund reserves the right to amend or terminate the Plan as applied to any
voluntary cash payments made and any dividend or distribution paid subsequent to
written notice of the change sent to participants in the Plan at least 90 days
before the record date for such dividend or distribution. The Plan may also be
amended or terminated by the Agent on at least 90 days written notice to
participants in the Plan. All correspondence concerning the Plan should be
directed to the Agent at State Street Bank and Trust Company, P.O. Box 366,
Boston, Massachusetts 02101.
Since the filing of the most recent amendment to the Fund's registration
statement with the Securities and Exchange Commission, there have been (i) no
material changes in the Fund's investment objectives or policies, (ii) no
changes to the Fund's charter or by-laws that would delay or prevent a change of
control of the Fund's, (iii) no material changes in the principal risk factors
associated with investment in the Fund. There has been a change to one of the
persons primarily responsible for the day-to-day management of the Fund's
portfolio. James E. Kennedy, Jr. has replaced George Caffrey, as a Vice
President of the Fund. Paul J. DeNoon, a Vice President of the Fund, continues
to act in that capacity.
--------------------------------------------------------------------------------
38 o ACM Managed Dollar Income Fund
BOARD OF DIRECTORS
William H.Foulk, Jr.,(1) Chairman
Marc O.Mayer, President
Ruth Block(1)
David H. Dievler(1)
John H. Dobkin(1)
Dr. James M. Hester(1)
Clifford L. Michel(1)
Donald J. Robinson(1)
OFFICERS
Kathleen A. Corbet, Senior Vice President
Paul J. DeNoon(2), Vice President
James E. Kennedy, Jr.(2), Vice President
Mark R. Manley, Secretary
Mark D. Gersten, Treasurer & Chief Financial Officer
Vincent S. Noto, Controller
Administrator
Princeton Administrators, L.P.
P.O.Box 9095
Princeton, NJ 08543-9095
Custodian
State Street Bank and Trust Company
225 Franklin Street
Boston, MA 02110
Dividend Paying Agent, Transfer Agent And Registrar
Equiserve Trust Company, N.A.
P.O. Box 43011
Providence, RI 02940-3011
Legal Counsel
Seward & Kissel LLP
One Battery Park Plaza
New York, NY 10004
Independent Auditors
Ernst & Young LLP
5 Times Square
New York,NY 10036
(1) Member of the Audit Committee
Notice is hereby given in accordance with Section 23(c) of the Investment
Company Act of 1940 that the Fund may purchase at market prices from time to
time shares of its Common Stock in the open market.
This report, including the financial statements therein, is transmitted to
the shareholders of ACM Managed Dollar Income Fund for their information.
This is not a prospectus, circular or representation intended for use in the
purchase of shares of the Fund or any securities mentioned in this report.
(2) Messrs. DeNoon and Kennedy are the persons responsible for the day-to-day
management of the Fund's investment portfolio.
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 39
MANAGEMENT OF THE FUND
Board of Directors Information
The business and affairs of the Fund are managed under the direction of the
Board of Directors. Certain information concerning the Fund's Directors is set
forth below.
PORTFOLIOS
IN FUND OTHER
NAME, AGE OF DIRECTOR, PRINCIPAL COMPLEX DIRECTORSHIP
ADDRESS OCCUPATION(S) OVERSEEN BY HELD BY
(YEARS OF SERVICE*) DURING PAST 5 YEARS DIRECTOR DIRECTOR
-------------------------------------------------------------------------------------------
DISINTERESTED DIRECTORS
William H. Foulk, Jr.,#, 71 Investment adviser and an 113 None
2 Sound View Drive independent consultant. He was
Suite 100 formerly Senior Manager of Barrett
Greenwich, CT 06830 Associates, Inc., a registered
(10) investment adviser, with which he
Chairman of the Board had been associated since prior to
1998. He was formerly Deputy
Comptroller and Chief Investment
Officer of the State of New York and,
prior thereto, Chief Investment
Officer of the New York Bank for
Savings.
Ruth Block,#, 73 Formerly Executive Vice President 96 None
500 SE Mizner Blvd. and Chief Insurance Officer of The
Boca Raton, FL 33432 Equitable Life Assurance Society
(10) of the United States; Chairman and
Chief Executive Officer of Evlico;
Director of Avon, BP (oil and gas),
Ecolab Incorporated (specialty chemicals),
Tandem Financial Group and Donaldson,
Lufkin & Jenrette Securities Corporation;
former Governor at Large National
Association of Securities Dealers, Inc.
David H. Dievler,#, 74 Independent consultant. Until 100 None
P.O. Box 167 December 1994 he was Senior
Spring Lake, NJ 07762 Vice President of Alliance Capital
(10) Management Corporation ("ACMC")
responsible for mutual fund
administration. Prior to joining ACMC
in 1984 he was Chief Financial Officer
of Eberstadt Asset Management since 1968.
Prior to that he was a Senior
Manager at Price Waterhouse & Co. Member
of American Institute of Certified
Public Accountants since 1953.
--------------------------------------------------------------------------------
40 o ACM Managed Dollar Income Fund
PORTFOLIOS
IN FUND OTHER
NAME, AGE OF DIRECTOR, PRINCIPAL COMPLEX DIRECTORSHIP
ADDRESS OCCUPATION(S) OVERSEEN BY HELD BY
(YEARS OF SERVICE*) DURING PAST 5 YEARS DIRECTOR DIRECTOR
-------------------------------------------------------------------------------------------
DISINTERESTED DIRECTORS
(continued)
John H. Dobkin,#, 61 Consultant. Formerly President of 98 None
P.O. Box 12 Save Venice, Inc. (preservation
Annandale, NY 12504 organization) from 2001-2002, a
(10) Senior Advisor from June 1999-
June 2000 and President of Historic
Hudson Valley (historic preservation)
from December 1989-May 1999. Previously,
Director of the National Academy of
Design and during 1988-1992, he was
Director and Chairman of the Audit
Committee of ACMC.
Dr. James M. Hester, #,79 President of the Harry Frank 11 None
25 Cleveland Lane Guggenheim Foundation, with
Princeton, NJ 08540 which he has been associated since
(10) prior to 1998. He was formerly
President of New York University and
the New York Botanical Garden, Rector
of the United Nations University
and Vice Chairman of the Board of the
Federal Reserve Bank of New York.
Clifford L. Michel,#, 64 Senior Counsel of the law firm of 97 Placer
15 St. Bernard's Road Cahill Gordon & Reindel since Dome, Inc.
Gladstone, NJ 07934 February 2001 and a partner of that
(10) firm for more than twenty-five years
prior thereto. He is President and
Chief Executive Officer of Wenonah
Development Company (investments) and
a Director of Placer Dome, Inc.(mining).
Donald J. Robinson,# 69 Senior Counsel to the law firm of 96 None
98 Hell's Peak Road Orrick, Herrington & Sutcliffe LLP
Weston, VT 05161 since prior to 1998. Formerly a
(7) senior partner and a member of the
Executive Committee of that firm. He
was also a member and Chairman of the
Municipal Securities Rulemaking Board
and Trustee of the Museum of the City
of New York.
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 41
PORTFOLIOS
IN FUND OTHER
NAME, AGE OF DIRECTOR, PRINCIPAL COMPLEX DIRECTORSHIP
ADDRESS OCCUPATION(S) OVERSEEN BY HELD BY
(YEARS OF SERVICE*) DURING PAST 5 YEARS DIRECTOR DIRECTOR
-------------------------------------------------------------------------------------------
INTERESTED DIRECTOR
Marc O.Mayer, +, 46 Executive Vice President of ACMC 68 None
1345 Avenue of the since 2001; prior thereto, Chief
Americas, Executive Officer of Sanford C.
New York, NY 10105 Bernstein & Co., LLC and its
(1 month) predecessor since prior to 1998.
* There is no stated term of office for the Fund's Directors.
# Member of the Audit Committee and Nominating Committee.
+ Mr. Mayer is an "interested director", as defined in the 1940 Act, due to
his position as Executive Vice President of ACMC.
--------------------------------------------------------------------------------
42 o ACM Managed Dollar Income Fund
Officer Information
Certain information concerning the Fund's Officers is listed below.
NAME, POSITION(S) HELD PRINCIPAL OCCUPATION
ADDRESS* AND AGE WITH FUND DURING PAST 5 YEARS**
--------------------------------------------------------------------------------------------
Marc O.Mayer,46 President See biography above.
Kathleen A. Corbet, 43 Senior Vice President Executive Vice President of
Alliance Capital Management
Corporation ("ACMC")**, with
which she has been associated
since prior to 1998.
Paul J. DeNoon, 41 Vice President Senior Vice President of ACMC,
with which he has been associated
since prior to 1998.
James E. Kennedy, Jr., 43 Vice President Senior Vice President of ACMC,
with which he has been
associated since prior to 1998.
Mark R. Manley, 41 Secretary Senior Vice President and Acting
General Counsel of ACMC**, with
which he has been associated since
prior to 1998.
Mark D. Gersten, 53 Treasurer and Chief Senior Vice President of Alliance
Financial Officer Global Investor Services, Inc.
("AGIS")**, and Vice President
of AllianceBernstein Investment
Research and Management, Inc.
("ABIRM")**, with which he has
been associated since prior to 1998.
Vincent S. Noto, 39 Controller Vice President of AGIS**, with which
he has been associated since prior to
1998.
* The address for each of the Fund's Officers is 1345 Avenue of the Americas,
New York, NY 10105.
** ACMC, ABIRM and AGIS are affiliates of the Fund.
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 43
ALLIANCEBERNSTEIN FAMILY OF FUNDS
--------------------------------------------------------------------------------
Wealth Strategies Funds
--------------------------------------------------------------------------------
Balanced Wealth Strategy
Wealth Appreciation Strategy
Wealth Preservation Strategy
Tax-Managed Balanced Wealth Strategy*
Tax-Managed Wealth Appreciation Strategy
Tax-Managed Wealth Preservation Strategy**
--------------------------------------------------------------------------------
Blended Style Series
--------------------------------------------------------------------------------
U.S. Large Cap Portfolio
--------------------------------------------------------------------------------
Growth Funds
--------------------------------------------------------------------------------
Domestic
Growth Fund
Health Care Fund
Mid-Cap Growth Fund
Premier Growth Fund
Small Cap Growth Fund+
Technology Fund
Global & International
All-Asia Investment Fund
Global Small Cap Fund
Greater China '97 Fund
International Premier Growth Fund
New Europe Fund
Worldwide Privatization Fund
Select Investor Series
Biotechnology Portfolio
Premier Portfolio
Technology Portfolio
--------------------------------------------------------------------------------
Value Funds
--------------------------------------------------------------------------------
Domestic
Balanced Shares
Disciplined Value Fund
Growth & Income Fund
Real Estate Investment Fund
Small Cap Value Fund
Utility Income Fund
Value Fund
Global & International
Global Value Fund
International Value Fund
--------------------------------------------------------------------------------
Taxable Bond Funds
--------------------------------------------------------------------------------
Americas Government Income Trust
Corporate Bond Portfolio
Emerging Market Debt Fund
Global Strategic Income Trust
High Yield Fund
Multi-Market Strategy Trust
Quality Bond Portfolio
Short Duration Portfolio
U.S. Government Portfolio
--------------------------------------------------------------------------------
Municipal Bond Funds
--------------------------------------------------------------------------------
National
Insured National
Arizona
California
Insured California
Florida
Massachusetts
Michigan
Minnesota
New Jersey
New York
Ohio
Pennsylvania
Virginia
--------------------------------------------------------------------------------
Intermediate Municipal Bond Funds
--------------------------------------------------------------------------------
Intermediate California
Intermediate Diversified
Intermediate New York
--------------------------------------------------------------------------------
Closed-End Funds
--------------------------------------------------------------------------------
All-Market Advantage Fund
ACM Income Fund
ACMGovernment Opportunity Fund
ACMManaged Dollar Income Fund
ACM Managed Income Fund
ACM Municipal Securities Income Fund
California Municipal Income Fund
National Municipal Income Fund
New York Municipal Income Fund
The Spain Fund
World Dollar Government Fund
World Dollar Government Fund II
We also offer Exchange Reserves,++ which serves as the money market fund
exchange vehicle for the AllianceBernstein mutual funds.
For more complete information on any AllianceBernstein mutual fund, including
investment objectives and policies, sales charges, expenses, risks and other
matters of importance to prospective investors, visit our web site at
www.alliancebernstein.com or call us at (800) 227-4618 for a current prospectus.
Please read the prospectus carefully before you invest or send money.
* Formerly Growth Investors Fund.
** Formerly Conservative Investors Fund.
+ Quasar Fund changed its name to Small Cap Growth Fund on 11/3/03.
++ An investment in the Fund is not a deposit in a bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
government agency. Although the Fund seeks to preserve the value of your
investment at $1.00 per share, it is possible to lose money by investing in
the Fund.
--------------------------------------------------------------------------------
44 o ACM Managed Dollar Income Fund
SUMMARY OF GENERAL INFORMATION
Shareholder Information
The daily net asset value of the Fund's shares is available from the Fund's
Transfer Agent by calling (800) 426-5523. The Fund also distributes its daily
net asset value to various financial publications or independent organizations
such as Lipper Analytical Services, Inc., Morningstar, Inc. and Bloomberg. Daily
market prices for the Fund's shares are published in the New York Stock Exchange
Composite Transaction section of newspapers each day. The Fund's NYSE trading
symbol is "ADF." Weekly comparative net asset value (NAV) and market price
information about the Fund is published each Monday in The Wall Street Journal,
each Sunday in The New York Times and each Saturday in Barron's and other
newspapers in a table called "Closed-End Funds."
Dividend Reinvestment Plan
Pursuant to the Fund's Dividend Reinvestment Plan shareholders whose shares are
registered in their own names may elect to have all distributions reinvested
automatically in additional shares of the Fund by Equiserve Trust Company, N.A.,
as agent under the Plan. Shareholders whose shares are held in the name of a
broker or nominee should contact the broker or nominee for details. All
distributions to investors who elect not to participate in the Plan will be aid
by check mailed directly to the record holder by or under the direction of
Equiserve Trust Company, N.A. For questions concerning Shareholder account
information, or if you would like a brochure describing the Dividend
Reinvestment Plan, please call Equiserve Trust Company, N.A. at (800) 219-4218.
--------------------------------------------------------------------------------
ACM Managed Dollar Income Fund o 45
ACM MANAGED DOLLAR INCOME FUND
1345 Avenue of the Americas
New York, NY 10105
(800) 221-5672
[LOGO] AllianceBernstein(SM)
Investment Research and Management
SM This service mark used under license from the owner, Alliance Capital
Management L.P.
MDIAR0903
ITEM 2. CODE OF ETHICS.
(a) The registrant has adopted a code of ethics that applies to its principal
executive officer, principal financial officer and principal accounting officer.
A copy of the registrant's code of ethics is filed herewith as Exhibit 10(a)(1).
(b) During the period covered by this report, no amendments were made to the
provisions of the code of ethics adopted in 2(a) above.
(c) During the period covered by this report, no implicit or explicit waivers to
the provisions of the code of ethics adopted in 2(a) above were granted.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
The registrant's Board of Directors has determined that independent directors
David H. Dievler and William H. Foulk, Jr. qualify as audit committee financial
experts.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Form N-CSR disclosure requirement not yet effective with respect to the
registrant.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Form N-CSR disclosure requirement not yet effective with respect to the
registrant.
ITEM 6. [RESERVED]
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
The registrant has adopted the following proxy voting policies and procedures of
its investment adviser, Alliance Capital Management L.P.
July 2003
ALLIANCE CAPITAL MANAGEMENT L.P.
Statement of Policies and Procedures for
Voting Proxies on Behalf of Discretionary Client Accounts
Introduction
As a registered investment adviser, Alliance Capital Management L.P. ("Alliance
Capital", "we" or "us") has a fiduciary duty to act solely in the best interests
of our clients. As part of this duty, we recognize that we must vote client
securities in a timely manner and make voting decisions that are in the best
interests of our clients.
3
This statement is intended to comply with Rule 206(4)-6 of the Investment
Advisers Act of 1940. It sets forth our policies and procedures for voting
proxies for our discretionary investment advisory clients, including investment
companies registered under the Investment Company Act of 1940. This statement is
applicable to Alliance Capital's growth and value investment groups investing on
behalf of clients in both US and global securities.
PROXY POLICIES
This statement is designed to be responsive to the wide range of subjects that
can have a significant effect on the investment value of the securities held in
our clients' accounts. These policies are not exhaustive due to the variety of
proxy voting issues that we may be required to consider. Alliance Capital
reserves the right to depart from these guidelines in order to avoid voting
decisions that we believe may be contrary to our clients' best interests. In
reviewing proxy issues, we will apply the following general policies:
Elections of Directors: Unless there is a proxy fight for seats on the Board or
we determine that there are other compelling reasons for withholding votes for
directors, we will vote in favor of the management proposed slate of directors.
That said, we believe that directors have a duty to respond to shareholder
actions that have received significant shareholder support. We may withhold
votes for directors that fail to act on key issues such as failure to implement
proposals to declassify boards, failure to implement a majority vote
requirement, failure to submit a rights plan to a shareholder vote and failure
to act on tender offers where a majority of shareholders have tendered their
shares. In addition, we will withhold votes for directors who fail to attend at
least seventy-five percent of board meetings within a given year without a
reasonable excuse. Finally, we may withhold votes for directors of non-U.S.
issuers where there is insufficient information about the nominees disclosed in
the proxy statement.
Appointment of Auditors: Alliance Capital believes that the company remains in
the best position to choose the auditors and will generally support management's
recommendation. However, we recognize that there may be inherent conflicts when
a company's independent auditor performs substantial non-audit related services
for the company. Therefore, we may vote against the appointment of auditors if
the fees for non-audit related services are disproportionate to the total audit
fees paid by the company or there are other reasons to question the independence
of the company's auditors.
Changes in Capital Structure: Changes in a company's charter, articles of
incorporation or by-laws are often technical and administrative in nature.
Absent a compelling reason to the contrary, Alliance Capital will cast its votes
in accordance with the company's management on such proposals. However, we will
review and analyze on a case-by-case basis any non-routine proposals that are
likely to affect the structure and operation of the company or have a material
economic effect on the company. For example, we will generally support proposals
to increase authorized common stock when it is necessary to implement a stock
split, aid in a restructuring or acquisition or provide a sufficient number of
shares for an employee savings plan, stock option or executive compensation
plan. However, a satisfactory explanation of a company's intentions must be
disclosed in the proxy statement for proposals requesting an increase of greater
than one hundred percent of the shares outstanding. We will oppose increases in
authorized common stock where there is evidence that the shares will be used to
implement a poison pill or another form of anti-takeover device, or if the
issuance of new shares could excessively dilute the value of the outstanding
shares upon issuance.
4
Corporate Restructurings, Mergers and Acquisitions: Alliance Capital believes
proxy votes dealing with corporate reorganizations are an extension of the
investment decision. Accordingly, we will analyze such proposals on a
case-by-case basis, weighing heavily the views of the research analysts that
cover the company and the investment professionals managing the portfolios in
which the stock is held.
Proposals Affecting Shareholder Rights: Alliance Capital believes that certain
fundamental rights of shareholders must be protected. We will generally vote in
favor of proposals that give shareholders a greater voice in the affairs of the
company and oppose any measure that seeks to limit those rights. However, when
analyzing such proposals we will weigh the financial impact of the proposal
against the impairment of shareholder rights.
Corporate Governance: Alliance Capital recognizes the importance of good
corporate governance in ensuring that management and the board of directors
fulfill their obligations to the shareholders. We favor proposals promoting
transparency and accountability within a company. For example, we will vote for
proposals providing for equal access to proxies, a majority of independent
directors on key committees, and separating the positions of chairman and chief
executive officer.
Anti-Takeover Measures: Alliance Capital believes that measures that impede
takeovers or entrench management not only infringe on the rights of shareholders
but may also have a detrimental effect on the value of the company. We will
generally oppose proposals, regardless of whether they are advanced by
management or shareholders, the purpose or effect of which is to entrench
management or dilute shareholder ownership. Conversely, we support proposals
that would restrict or otherwise eliminate anti-takeover measures that have
already been adopted by corporate issuers. For example, we will support
shareholder proposals that seek to require the company to submit a shareholder
rights plan to a shareholder vote. We will evaluate, on a case-by-case basis,
proposals to completely redeem or eliminate such plans. Furthermore, we will
generally oppose proposals put forward by management (including blank check
preferred stock, classified boards and supermajority vote requirements) that
appear to be intended as management entrenchment mechanisms.
Executive Compensation: Alliance Capital believes that company management and
the compensation committee of the board of directors should, within reason, be
given latitude to determine the types and mix of compensation and benefit awards
offered. Whether proposed by a shareholder or management, we will review
proposals relating to executive compensation plans on a case-by-case basis to
ensure that the long-term interests of management and shareholders are properly
aligned. We will analyze the proposed plans to ensure that shareholder equity
will not be excessively diluted, the option exercise price is not below market
price on the date of grant and an acceptable number of employees are eligible to
participate in such programs. We will generally oppose plans that permit
repricing of underwater stock options without shareholder approval. Other
factors such as the company's performance and industry practice will generally
be factored into our analysis. We will support proposals to submit severance
packages triggered by a change in control to a shareholder vote and proposals
that seek additional disclosure of executive compensation. Finally, we will
support shareholder proposals requiring companies to expense stock options
because we view them as a large corporate expense.
Social and Corporate Responsibility: Alliance Capital will review and analyze on
a case-by-case basis proposals relating to social, political and environmental
issues to
5
determine whether they will have a financial impact on shareholder value. We
will vote against proposals that are unduly burdensome or result in unnecessary
and excessive costs to the company. We may abstain from voting on social
proposals that do not have a readily determinable financial impact on
shareholder value.
Proxy Voting Procedures
Proxy Voting Committees
Our growth and value investment groups have formed separate proxy voting
committees to establish general proxy policies for Alliance Capital and consider
specific proxy voting matters as necessary. These committees periodically review
new types of corporate governance issues, evaluate proposals not covered by
these policies and recommend how we should generally vote on such issues. In
addition, the committees, in conjunction with the analyst that covers the
company, contact management and interested shareholder groups as necessary to
discuss proxy issues. Members of the committees include senior investment
personnel and representatives of the Corporate Legal Department. The committees
may also evaluate proxies where we face a potential conflict of interest (as
discussed below). Finally, the committees monitor adherence to guidelines,
industry trends and review the policies contained in this statement from time to
time.
Conflicts of Interest
Alliance Capital recognizes that there may be a potential conflict of interest
when we vote a proxy solicited by an issuer whose retirement plan we manage,
whose retirement plan we administer, or with whom we have another business or
personal relationship that may affect how we vote on the issuer's proxy. We
believe that centralized management of proxy voting, oversight by the proxy
voting committees and adherence to these policies ensures that proxies are voted
with only our clients' best interests in mind. That said, we have implemented
additional procedures to ensure that our votes are not the product of a conflict
of interests, including: (i) requiring anyone involved in the decision making
process to disclose to the chairman of the appropriate proxy committee any
potential conflict that they are aware of and any contact that they have had
with any interested party regarding a proxy vote; (ii) prohibiting employees
involved in the decision making process or vote administration from revealing
how we intend to vote on a proposal in order to reduce any attempted influence
from interested parties; and (iii) where a material conflict of interests
exists, reviewing our proposed vote by applying a series of objective tests and,
where necessary, considering the views of a third party research service to
ensure that our voting decision is consistent with our clients' best interests.
For example, if our proposed vote is consistent with our stated proxy voting
policy, no further review is necessary. If our proposed vote is contrary to our
stated proxy voting policy but is also contrary to management's recommendation,
no further review is necessary. If our proposed vote is contrary to our stated
proxy voting policy or is not covered by our policy, is consistent with
management's recommendation, and is also consistent with the views of an
independent source, no further review is necessary. If our proposed vote is
contrary to our stated proxy voting policy or is not covered by our policy, is
consistent with management's recommendation and is contrary to the views of an
independent source, the proposal is reviewed by the appropriate proxy committee
for final determination.
Proxies of Certain Non-US Issuers
6
Proxy voting in certain countries requires "share blocking." Shareholders
wishing to vote their proxies must deposit their shares shortly before the date
of the meeting (usually one-week) with a designated depositary. During this
blocking period, shares that will be voted at the meeting cannot be sold until
the meeting has taken place and the shares are returned to the clients'
custodian banks. Alliance Capital may determine that the value of exercising the
vote does not outweigh the detriment of not being able to transact in the shares
during this period. Accordingly, if share blocking is required we may abstain
from voting those shares. In such a situation we would have determined that the
cost of voting exceeds the expected benefit to the client.
Proxy Voting Records
Clients may obtain information about how we voted proxies on their behalf by
contacting their Alliance Capital administrative representative. Alternatively,
clients may make a written request for proxy voting information to: Mark R.
Manley, Senior Vice President & Assistant General Counsel, Alliance Capital
Management L.P., 1345 Avenue of the Americas, New York, NY 10105.
ITEM 8. [RESERVED]
ITEM 9. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive officer and principal financial officer
have concluded that the registrant's disclosure controls and procedures (as
defined in Rule 30a-2(c) under the Investment Company Act of 1940, as amended)
are effective at the reasonable assurance level based on their evaluation of
these controls and procedures as of a date within 90 days of the filing date of
this document.
(b) There were no significant changes in the registrant's internal controls that
could significantly affect these controls subsequent to the date of their
evaluation, including any corrective actions with regard to significant
deficiencies and material weaknesses.
7
ITEM 10. EXHIBITS.
The following exhibits are attached to this Form N-CSR:
Exhibit No. DESCRIPTION OF EXHIBIT
----------- ----------------------
10(a)(1) Code of ethics that is subject to the
disclosure of Item 2 hereof
10(b)(1) Certification of Principal Executive Officer
Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002
10(b)(2) Certification of Principal Financial Officer
Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002
10(c) Certification of Principal Executive Officer
and Principal Financial Officer Pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002
8
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant): ACM Managed Dollar Income Fund, Inc.
By: /s/ Marc O. Mayer
--------------------------------------------
Marc O. Mayer
President
Date: November 25, 2003
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ Marc O. Mayer
--------------------------------------------
Marc O. Mayer
President
Date: November 25, 2003
By: /s/ Mark D. Gersten
--------------------------------------------
Mark D. Gersten
Treasurer and Chief Financial Officer
Date: November 25, 2003