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Our Ref. No. 97-141-CC
 

RESPONSE OF THE OFFICE OF CHIEF COUNSEL
 Alliance Funds
 

DIVISION OF INVSTMNT MAAGEMENT File No. 801-32361
 

Your letter dated March 5, 1997 requests assurance that we 

would not recommend enforcement action to th~ Commission under 

Section 17 (d) of the Inves~ment Companr Ac~.of 1940 (the "Act") 

and Rule 1 7d- 1 thereunder if, as described in your letter, the 

open-end registered investment companies (the "Funds") for which " 

Alliance Capital Management L.P. ("Allianc~ Capital") serves as 

investment adviser enter into a committed line of credit with one
 

or more banks for which each Fund would pay a portion of the


commitment fee and other expenses under the arrangement. , You 

state that the line of credit would provide ,the Funds with a
 

source of cash for temporary and emergency purposes to meet
 

unanticipated or abnormlly heavy redemption requests by
 

shareholders of the Funds.
 

Facts ~ 

You state that the Funds intend to obtain the line of credit
 

pursuant to an "umrella" facility. There would be pne loan
 

agreement ("Agreement") to which each participating Fund would be
 

a signatory. ~/ The Agreement would stipulate a maximum
 

amount of aggregate borrowings' and would have a term of
 

approximately one year, during which time all banks would remain
 

committed and no amendments could be made without mutual
 

agreement of the banks and each Fund.
 

You state that each Fund in the arrangement could, at any
 

time, borrow up, to the lesser of: (i) a contractual limit, which
 

will be stated as a percentage of its net assets, or (ii) the
 

amount unused under the aggregate maimum amount of the facility.
 

In either case, borrowings will be limited to no more than the
 

amount permitted under the Act and each Fund's fundamental
 

investment policies. When a Fund borrows under the facility, the
 

liability for principal repayment and interest payment would be
 

the obligation of that Fund only. Under no circumtances would
 

a~y Fund be liable for the obligations of any other Fund.
 

Borrowings. under the initial Agreement would be unsecured, but
 

collateral could be required by negotiations at a later


date. 2:/ 

~/ Certain Funds, such as money market funds; would not
 

participate in the Agreement.
 

2:/ If collateral is required for future borrowings, each Fund
 

would provide collateral only in connection with its own
 

borrowing, and would not provide collateral for borrowing by
 

any other Fund. A Fund would provide collateral for its
 

(continued. . . ) 
- 2 ­

You state that the banks entering into the Agreement would
 

be compensated with a "commitment fee," which would be fixed for
 

the term of the Agreement and paid quarterly in arreàrs. The fee
 

payment would be calculated quarterly on the unused portion of
 

the credit line, 'so the amount on which the fee would be
 

calculated would be reduced by the amount of the actual
 

borrowings (~, if the entire line were being used there would
 

be no commitment fee). You represent that the basis for
 

apportioning the fee generally would be pro rata based on each
 

participating Funds' average net assets. ~/ You further
 

represent that procedures would be established, under 
 the supervision of the Funds' boards of directors, to allocate loans
 

on a first-come, first-served basis. If, at a particular time,
 

the demand for loans exceeds the available supply under the
 

Agreement, the available loans would be allocated among the Funds
 

on a fair and equitable basis. ~/
 

The credit arrangement would involve a numer of banks. The Funds will retain an "agent bank" to facilitate the preparation
 

of the loan documentation and to arrange the syndication of the
 

deal to other banks. The agent bank would be paid a fee ,
 

apportioned on a pro rata basis of each 
 participating Funds'
 average net assets. Moreover, additional costs, such as outside
 

2:/ ( . . . continued) 

'borrowing only if permitted under the Fund's investment
 

policies. Telephone conversation on March 25, 1997 between
 

Brian McCabe and Veena Jain.
 

3/ You state that the apportionment of the commitment fee may
 

be adjusted to take into consideration other factors, such
 

as the level of borrowing by each Fund. Any adjustment to
 

the apportionment methodology will be approved by each
 

Fund's Board of directors. Telephone conversation on March
 

25, 1997 between Brian McCabe and Veena Jain.
 

4/ You state that although the basis for allocation has not yet
 

been determined, the most likely basis 
 would be ~ rata
 

based on the participating Funds' average net assets and the
 

amount requested. To establish the exact allocation, the
 

boards of directors would consider such matters as: (i) the
 

amount available under" the Agreement; (ii) the amount
 

requested by each Fund and the Funds in the aggregate; (iiil
 

the availability of other sources of cash to meet each


Fund's needs (such as uncommitted lines ofcredi t , short _ 

term, liquid investments, and cash reserves); (iv) the
 

history of each requesting Fund's requests for 
 loans ; (v)
 each requested loan's expected duration; and (vi) the
 

expected need for loans in the immediate future.
 
- 3 ­

counsel fees for the Funds and banks, also would be apportioned
 

to the participating Funds on the, same pro rata basis. '
 

Finally, the Agreement would be approved by each Fund's
 

board of directors, including a majority of the disinterested
 

directors, prior to any Fund entering into the Agreement and
 

annually thereafter. Each Fund's board of directors will
 

determine annually that the Fund's participation in the Agreement
 

would be fair and equitable and in the Fund's best interest. The
 

factors that each board 
 would consider in making this
 

determination would include: (i) the Fund's expected benefits and
 

costs; (ii) the Fund's experience under the loan arrangement;
 

(iii) the Fund's available sources of liquidity; and (iv) the
 

Fund's expected continuing need for the loan arrangement.
 

~alysis 

Section 17 (d) and Rule 17d-1 prohibit an affiliated person
 

of an investment company from participating in a j oint enterprise
 

or other joint arrangement or profit-sharing plan with such
 

company without first obtaining an order from the Commission.
 

The purpose of Section 17 (d) and Rule 1 7d- 1 is to protect '
 

investment companies from participating in transactions with
 

affiliated persons on inequitable terms.
 

You believe that the arrangement described above does not
 

constitute a joint or a joint and several transaction within the
 

meaning of Section 17 (d) or Rule 1 7d- 1. In addition, you believe
 

that the proposed arrangement will pose none of the dangers that
 

Section 17 (d) and Rule 1 7d- 1 are designed to prevent. Yóu assert r
 

that each Fund will participate in the arrangement on an equal
 

basis. You represent that each Fund will share the commitment
 

fee, agent bank fee, and other expenses under the Agreement only
 

if its board of directors, including a majority o~ the
 

disinterested directors, determines that such 
 participation would
 be fair and equitable and in the best interests of the 'Fund. You
 

also state that all the Funds participating in the arrangement
 

have common and substantially similar interests. You assert that
 

the only potential for conflict arises if the demnd for borrowed
 

funds under the line of credit exceeds the amount available under
 

the line. You represent that, in such instance, the available
 

loans would be apportioned among the Funds on a fair and
 

equitable basis in accordance with procedures established by the
 

Funds' boards of directors in advance of entering into the
 

Agreement. ~/ You also represent that the portion of the
 

commitment fee paid by each Fund will be so small that it will
 

~/ Telephone conversation on April 22, 1997 between Brian
 

McCabe and Veena Jain.
 
- 4 ­

not, as a practical matter, have any effect on the Fund's net
 asset value per share,. 

Without necessarily agreeing with your legal analysis, based
 

on the facts and representations in your letter, we would not
 

recommend enforcement action to the Commssion pursuant to
 

Section 17 (d) or Rule 1 7d- 1 thereunder if the Funds enter into a
 

committed line of credit arrangement and pay the commitment and
 

other fees as described above and in your letter. Q/ You
 

should note that different facts or representations might require
 a different conclusion. ' 

Having stated our views with respect to committed line of
 credit arrangements under Section 17 (d) and Rule 
 1 7d- 1 

thereunder ,we will no longer respond to requests for no-action
 

relief in this area unless they present novel or unusual issues.
 

y~ /C.~
 Veena K. Jain
 

Staff Attorney
 

\ 

) 

Q/ See The T. Rowe Price Funds (pub. avail. Ju~y 31, 1995).
 
¡ .
 

30 KENNEDY PLA 

PROVIDENCE, RI 02903-2328
 

(401) 455 -4400 

, f"AX: (401) 455-4401 

VI COURR
 

Marh 5, 1997
 

ROPES & GRAY
 

ONE INTERNATIONAL PLACE
 

BOSTON, MASSACHUSETTS 02110-2624
 

(617) 951-7000 

FAX: (617) 951-7050
 

WRITR'S DIRECT DIAL NUMBER: (6 I 7) 95 I -760 I
 

ONE f"RANKLIN SOUARE 

1301 K STREET, N. W. 

SUITE 800 EAST
 

WASHINGTON, DC 20005-3333
 

(202) 626-3900 

f"AX: (202) 626-3961 

John V. O'Hanon, Esquire 

Division of Investment Mangement 

Securties and Exchage Commssion 

450 Fif Street, N. W., MS 7-8
 

Washigton, D.C. 20549
 

Re: Commtted Line of Credit 

Dear Mr. O'Hanon: 

1940 ActSeon 17(d) - Rule 17d-1 

N: J: t. A - , .. SEOTOJf I Î I d. ") 

BtJ , . 

:l;l1ia..JlI if/ ~ S' I q¡
 

\. 

On behaf of Alliance Capita Mangement L.P. ("Alliance Capita"), we are wrti to
 

request assurance tht the staff of the Securities and Exchae Commsion ("Commsion") 

would not reconÌend enforcement action under the Investment Company Act of 194, as 

amended (" 1940 Act"), if the open-eIi registered investment companes forwhich Alce 

Capita serves as investment 
 advisr (the "Al Fun") were to enterii0 a commtt line ' 

of credt with one or more ban in order to sece a SOuI of fuds forteïtra an .
 

emergency purses to meet unticipate or abnormy heavy redemption 


reeSts by
 shaeholders of the Ai Fun. Beuse each Aliace Fun would pay a 


porton of the commtment fee re'uner the arement, it is arguble tht tbe arement cóuld 

-; rai issues uner Setion 17(d) of the 194 Act and Rule 17d-l thereuner.
 

Background 

Historicay, uncommtt lines of credit have ben suffcient tó meet the reemption 

nee of the Allian Fun and, so far as we are aware, the inustr. Uncommtt credit
 

facilties are arangements with ban whereby the ban ha perforned its creit review of a 

mutu fud and ha agree to ,entert loan requests from the fud. 
 The clea understaing,


which is reflecte in the documentation for such lines, is tht the ban'¡s under no obligation ) to mae loan and wil mae them at its sole discretion. Despite the 
 tenuous natue of such
 
ROPES & GRAY
 

john V. O'Hanon, Esquire -2­ March 5, 1997
 

arangements, they have served the nee of the industr to date. Their advange is tht there
 

is no cost to the mutual fud but their disadvantig~ is tht the ban is not under any obligation 

to advance fuds when reqeste.
 

If al conditions rema constat, and if the history of the industr were a goo
 

predctor of the futue, uncommtt credit facilties would likely be adeqte to meet the 

emergency liquidity nee of the Aliance Funds. However, there are several imrt 

developments which mae Alliance Capita believe tht the 
 Aliance Funds should have the
 

option to seek commtted lines of credit in the futue.
 

There are relatively few ban which are active in lendig to mutu fu, even with 

uncommtt facilties. Moreover, there is. growing resistace among them to invest the effort 

for the form credit review procss for each individua fud (a necssar precndition to 

lending) without compensation. If present trends contiue, uncommtt facilties wil be
 

avaiable only from a shrg number of 
 ban. 

Uncommtt loan facilties are generally available only from ban which have, or ' 

anticipate having, some other relationship with the mutual fud such as securties leml,ing or, 

custodial services. Alliance Capita believes the Alliance Funds should be in a position to
 

secure a source of borrowing without regard to these other factors.
 

Ban in recnt years have seen their tota commtt loan facilties to entities in and 

around the securties business (e.g., DTC and NYSE) escalate as they prepare themselves for
 

maging cah durg period of high demad. Ths could increae the chace of loan
 

requests not beihg fuded under uncommtted facilties.
 

With the inreaed speialtion and interntionaiztion of mutu fu portolios, the 

inustr is appropriately givi 
 greater attnton to alterntive method for funding redemptions dur period of maket volatity. ' 

Th mutu fu inustr ha may new fu. The ripple eftect of how thes fu 

, an their shaeholders hae negative maket events could have signcat imact on the 

redemption activity of the mutu fud industr at large. 

The Aliace Fun dibure viry al redemption proc on the day the
 

redemption reqest is recived and the shaes are redeemed. If the portolio mager ne to
 

sell securities, the sale may not sette unti thee days aftr the money was dibured.
 

Most mutu fuds have established procures to fud redemptions durg unus 

maket activity. These include: holding the main of redemption prOc an delaying 
 the tranmision of exchage proc for up to five business days; increain reserves in
 

anticipation of maket volatilty; and the establishment of uncommtt lines of ciedit. In light
 
ROPES & GRAY
 

john V. O'Hanon, Esquire -3­ March 5, 1997
 

of the aboye liste factors, however, we believe it is appropnate to consider the establihment 

of commtt lines of credit as a fuer safeguard. 

Under curent maket conditions, Aliace Capita believes tht the Alliance Funds 

would fmd it advantageous to enter into a commtt line of credit so tht, when the tie
 

comes, the Fun wil be able to act quickly. The iy of commtt line of credit which 

Alliance Capita ha discussed with varous ban would have the following chaactenstics: 

An "umbrella" facilty. There would be one loan agreement ("Agreement") of which
 

each paricipatig Alliance'Fundwould be a signtory. Certin Funds, such as money maket 

fuds, would not paricipate, but it is curently 
 expete tht about 30 Alliance Funds, a-list of
 

which is attched hereto as Exhbit A, would intially be in the facilty. Other fuds advised 

by Aliance Capital could be added in the future. '
 

The Agreement would stipulate a maum amount of aggregate borrowings at one 

time, curently expte to be approximtely $500 miion. '
 

The Agreement would have a term of approximtely one yea during which al:_ban
 

would remain commtted and no amendments could be made without mutu agreement of the 

bank and each Alliance Fund. 

The Agreement woulct have norml provisions for representations and waranties, 

business covenats and events of default. ,So long as the paricular Fund requesting a loan were 

not in default, the ban would be contractually obligated to honor al requests for loan. 

Each Aliace Fund in the arangement could, at any tie, borrow up to the lesser of: 

(1) a contrctu limt which wil be state as a percnt of its net assets or (2) the amoun 

unused under the aggregate maum amount of the . 
 facilty , in either cae lite to no more
 

th the amount permtt by the 1940 Actand each fud's fundamenta investment-policieS.
 

When an Al Fu borrows uner the facilty, the libilty for priipal reayment 

an interest payment would be the obligation of tht fu only. Under no cirtaces wóuld 

any Alian Fu be liable for the obligations of any other Alance Fun. 

Borrowis under the intial Agreement would be unecur (but collatera could'be 

reqired by negotitions at a later date). 

No ban paricipating in any loan arement would be an afiliate of Alia Capita 

or any Aliance Fund. 

The ban enterig into the agreement would be compensate with a "commtment fee"
 

which is a rate denomite in basis points. The rate would be fixed for the term 
 of the 
ROPES & GRAY
 

John V. O'Hanon, Esquire -4­ March 5, 1997
 

Agreement, and would be paid quarly in areas. The commtment fee would be caculate
 

on the unused porton of the line, so the amount on which the fee would.be cacuate would 

be reduce by the amount of actu borrowins (e.g., if the entire line were bein us there 

would be no commtment fee durg the remaining period of the loan.) 

Each Alce Fund parcipatig in the Agreement would pay its 
 ,porton of the commtment fee. Thë basis for apportonig the fee would be pro rata based on the average 

net assets of the parcipating Alliance Funds. 

Procures would be established, under the supervision of the boards of directors, to 

alloète loan on a fist come; first served basis. If at a parcular tie, the demad for loai 

exce the available supply under the Agreement, the avaiable loan would be apportoned 

among the Aliance Funds .on a fair and equitable basis. Although the basis for apportonment 

ha not yet ben determed, the most likely choice would be pro rata based ~n average net 

assets of the parcipatig Alliance Funds and the amount requešte. To determ the exact 

method of apportonment, the boards of directors would consider such mattrs as: the amoun 

avaiable under 
 the Agreement; the amount requested by each Aliance FUd and by the 

Aliance Funds in the aggregate; the availabilty of other sources of monies to meet tht nee 

of each Aliance Fund such as uncommtted lines of credit, cah reserves and other short-term, 

liquid investments; the history of each requesting Alliance Fund's requests for loan; the
 

expeted duration of each requested loan; and the expete nee for loan in the imediate
 

futue. 

As the credit arangement would involve a number of 
 ban, an "agent ban" would
 

likely be retåineä to faciltate the prepartion of the loan documentation and to arge the 

syndication of the dea to other ban. Tht bank would be paid a fee for acti as agent. The 

fee would be paid when the syndication is complete or in area on some.basis.Such fee 

would be apportone among each parcipati Alian Fund on a 
 pro based nti'basis on 

average net assets. 

There would be other co~ts associate with the Agrment, Sach as outside 
 counl for the Al 
 Fu an the ban, which would alo be apportoned across th parcipati
 

fu ona pro rata basis. It is the custom in the industr for counel fee to be paid by the 

borrower. However, such fees are expte to be inignca.
 

The Agrment would be approved by the board of directors, includi a majority of 

the independent diectors, of each parcipatig 
 Aliace Fund prior to any Alan Fun enterig into the Agreement and anuay thereaftr. No Aliance Fund would be alowed to 

intiy parcipate or renew its parcipation in the Agreement uness the Board of such fud
 

determes tht parcipation would be fair and equitable and in the best interest of each 

parcipati fud. The factors the boards would consider in mag tl determtion would 

include the expete benefits and costs to each fud, the experience of each fu under the 
_ROPES & GRAY
 

John V. O'Hanon, Esquire -5­ March 5, 1997
 

loan arangement, the availabilty of other sources of liquidity for each fud and the expete 

contiuing nee for the loan arangement.
 

Legal Anysis and Applicable Precent 

Setion 17(d) of the 1940 Act provides, in pertent par, as follows:
 

It sha be unawfl for any affiliate person of ... a registered investment company ... 

or any affiliate person of such person ... acti as pricipal to effect any tranaction in which
 

such registered company ... is a joint or a joint and several 
 parcipant with such person ... or afiate person, in contravention of such rules and reguationS as the commssion may prescribe for the purose of limtig or preventig paricipation by such registered or 

controlled company on a basis different from or less advantageous th tht of such other
 

parcipant .... 

Rule 17d-l under the 1940 Act provides, in relevant par, as follows: 

No affliated person of ... any registered investment company ... and no affiate 

person of such a person ... acting as principal, shal paricipate in, or effect any tranaction in 

connection with, any joint enterprie or other joint arangement or pr9fit-shaîng plan in which 

any such registered company ... is a parcipant, and which is entered into, adopte or 

modified subseqent to the effective date of ths rue, uness an application regarding such 

joint enterprise, arangement or profit-shag plan has ben fioo with the Commssion and 

ha ben grate by an order entered prior to the submission of 

such plan or modifcation to security holders for approval .... Rule 17d-l(a). 

A "joint entrprie or other joint arement" as us in th rue sha mean an 

wrttn or ora plan, contrct, authorition or arement, or any practice or unerstadi 

concern an enterprie or undert whereby a registered investment company ... and any
 

afiliate person of ... such registered investment company, or an afte person of such a 

person, ..., have a join or a join an severa parcipation, or shae in the profits of such

enterprie or unert, .... Rule 17d-l(c). 

We do not believe the arangement describe above constitutes a 
 join or.ajoin an severa traction with, 
 the meag of Setion 17(d) or Rule 17d-1. Th is beuse the 

board of directors of each paricipatig Alia Fund, in approvig parcipation in the 

Agreement for tht fud, wil consider only tht fud's interest. In no cae wil a decision tht 

a parcular Aliance Fund should parcipate be based, to any degree, upon a determtion 

tht such parcipation might fuer the interests of other Aliance Funds. 

) We have found only one applicable no action lettr rehitig to the use of a commtt
 

line of credit and payment of a commtment fee by a group of affiate mutu fuds. The no­
ROPES & GRAY
 

John V. OlHanon, Esquire -6­ March 5, 1997
 

action position taen in T. Rowe Price (pub. avaiL. July 31, 1995) is substatialy identica to
 

the relief requeste by ths letter. In the area of exemptive relief, the only relevant precent 

we have found is Rule 17g-1 under the 1940 Act which provides exemptive relief 
 for the 

purchae of a joint fidelity bond coverig afi1iate mutual fuds and their affi1iate investment 

advisers and distrbutors. The existence of Rule 17 g-1 does not imly, however, tht any 

shag of a common resource or asset by affi1iate mutu fuds requires exemptive relief 

under Section 17 of the 1940 Act. The key fact distinguishig the intat arangement and the 

arangement to which Rule 17g-1 is addressed is, tht under Rule 17g-1, the affi1iate 

investment advisers and distributors of the mutual fuds are permtt to be paries to the
 

fidelity bond. Obviously, situations involving a shag of resources by a mutu fud and its 

investment adviser or pricipal underwter are vastly different and raise signcat confict of
 

interest issues which are not present in the commtted line of credit discussed herein. 

Furermore, there are sound policy reasons for the staff to grant the no-action relief 

which we request. Whle supplying increased liquidity to the paricipating Aliance Funds, the 

proposed arangement wil, for the reasons set fort below, pose none of the dagers tht
 

Section 17 and Rule 17d-l are designed to prevent: 

Each Alliance Fund wil paricipate in the arrangement on an equal basis. In th
 

regard, each Alliance Fund wil have equal access to the line of credit and the costs of the 

arangement, Le., commtment fees, documentation and legal fees, wil be apportoned on a 

pro rata basis among the paricipating Alliance Funds. Thus, there wil be no paricipation by 

any Alliance Fund "on a basis different from or less advantageous than tht of (any) other 

participant. " 

All of the Alliance Funds are on the same side of the tranaction, Le., they are al
 

potenti borrowers. Thus, their interests are common and substatially the same. The only
 

potential for confict is if the demad for borrowed fuds uner the line of credt by al of the 

Alliance Funds exce the amouit available under the line. However, th sitution would 

exit even in the absence of a commtt line beuse any given ban ar group of ban wi 

only lend a fite amoun of fuds to any given mutu fud or group of fu. As describe 

earlier, the boards of directors of the Aliance Funds wil be responsible for developin 

criteri to determe a fai and equitable apportonment of fuds available for borrowing
 

should the fuds available be less th the demad. The issue of alocting a limte resource 

also exits with respet to everyday purhaes of securties for the Alliance Funds where there
 

ca oftn be caes where several funds wil purchae the same securty but no fu wil be
 

allott the full amount it desires of the security.
 

To our knowledge, the Commssion ha not taen the position tht the norm purchae 

by one or more affiate mutu fuds of the same security and the alloction among those 

funds of diferig amounts of that securty under circumtaces where each fud does not 

receive all of the security it may have wanted raises an issue under Section 17(d). 
ROPES & GRAY
 

John V. O'Hanon, Esquire -7­ March 5, 1997
 

We would also point out tht the amount of the commtment fee paid by each Aliance
 

Fud wil be so sma tht there wil not be, as a practical mattr, any effect on any of the
 

Aliance Funds' net asset value per shae. In our view, each Alia Fund's payment of its
 

pro rata shae of the commtment fee is no different from the payment of other fees by 

afiate fuds in a mutu fud complex. For exale, may mutu fud complexes pay a
 

magement fee composed of an individua fee and a group fee determed by the ratio of the 

fud's day net assets to the daily net assets of all the mutu funds in the complex. The 

group fee is intended to reflect the fact tht affiliated mutul fuds in a complex shae 

resources such as research, trading facilties, overhead and technology. Quite obviously, ths 

resource shag wil never be exactly equa and each fund wil accss and .ue the common
 

resources to differig extents. Group fee arangement have been li place for quite some tie.
 

Again, to our knowledge the Commssion ha never taen the position tht such arangements 

violate Section 17 (d). The existence of these group fee arangements and others where mutu 

fuds pay fees on a pro-rata basis for shaed resources, such as tranfer agent or custodia 

fees, support our view tht the payment of the commtment fee by the Aliance Funds based 

on pro rata alloction of assets or some simar meaure should not raise concern under 

Section 17 (d). 

Conclusion 

For the reaons stated above, we request tht the staff of the Commssion issue a letter 

stating that the staff wil not recommend enforcement action to the Commssion if the Aliance 

Funds enter into the commtted line of credit arangement and pay the commtment fees 

describeabove~ 

Should you have any questions regarding th 
 matter , pleae ca the undersign at 

(617) 951-7801. 

Sincerely yours, 

BDMlw:3189.08 

cc: Jack W: Murhy, Esq.
 

Chief Counel
 

Division of Iivestment Mangement
 

Securties and Exchage Commssion
 

Edund P. Bergan, Esq. 

Andrew L. Gangolf, Esq. 

J.B. Kittedge, Esq.
 
ROPES & GRAY
 

John V. O'Hanon, Esquire -8­ March 5, 1997
 

Exhibit A 

Aliance Al-Asia Investment Fund, Inc.
 

Alance Balance Shaes, Inc.
 

Alce Bond Fund, Inc.
 

Alian Developin Markets Fund, Inc. 

Aliace Global Dollar Governent 
 Fund, Inc. 

Aliance Global Smal Cap Fund, Inc.
 

Aliance Global Strategic IncomeTrust, Inc.
 

Aliance Growt'and Income Fund, Inc.
 

Aliance Income Builder Fund, Inc.
 

Aliace Interntiona Fund
 

Aliace Mortgage Securities Income Fund, Inc.
 

Aliance Limte Matuty Governent Fund, Inc.
 

Aliace Multi-Market Strategy Trust, Inc.
 

Aliance Muncipal Income Fund, Inc.
 

Alance Muncipal Income Fund II
 

Aliance New Europe Fund, Inc.
 

Alliance Nort America Governent Income Trut, Inc. 

Aliance Premier Growt Fund, Inc.
 

Aliance Quar Fund, Inc.
 

Alliance Rea Estate Investment Fund, Inc.
 

AliancelRegent Sector Opportnity Fund, Inc.
 

Alliance Short-Term Multi-Market Trut, Inc.
 

Aliance Technology Fund, Inc. 

Alliace Utity Income Fund, Inc.
 

Aliace Varable Products Series Fund, Inc. 

Al World Inme Trut, Inc.
 

Alce Worldwide Prvatition Fund, Inc. 

The Hudson River Trut
 

The Al Portolios