-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, F97hc5BJKgVOhOeCqupwd3AY9cvidFrgMmhzvYS2SoNtIt3mVl4EoLHvqESekXp5 37ve8uXq358gNnnGlL57qA== 0000936772-03-000086.txt : 20030221 0000936772-03-000086.hdr.sgml : 20030221 20030221142810 ACCESSION NUMBER: 0000936772-03-000086 CONFORMED SUBMISSION TYPE: N-30D PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20021231 FILED AS OF DATE: 20030221 EFFECTIVENESS DATE: 20030221 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ALLIANCE VARIABLE PRODUCTS SERIES FUND INC CENTRAL INDEX KEY: 0000825316 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-30D SEC ACT: 1940 Act SEC FILE NUMBER: 811-05398 FILM NUMBER: 03575777 BUSINESS ADDRESS: STREET 1: 500 PLAZA DRIVE STREET 2: 1345 AVENUE OF THE AMERICAS 31ST FL CITY: NEW YORK STATE: NY ZIP: 10105 BUSINESS PHONE: 2013194105 MAIL ADDRESS: STREET 1: ALLIANCE CAPITAL MANGEMENT LP STREET 2: 1345 AVENUE OF THE AMERICAS CITY: NEW YORK STATE: NY ZIP: 10105 N-30D 1 edg8790.txt ALLIANCE ----------------------- VARIABLE PRODUCTS ----------------------- SERIES FUND ----------------------- ALLIANCEBERNSTEIN VALUE ----------------------- PORTFOLIO ----------------------- ANNUAL REPORT DECEMBER 31, 2002 Investment Products Offered --------------------------- > Are Not FDIC Insured > May Lose Value > Are Not Bank Guaranteed --------------------------- ALLIANCEBERNSTEIN VALUE PORTFOLIO Alliance Variable Products Series Fund ================================================================================ LETTER TO INVESTORS January 16, 2003 Dear Investor: The following is an update of Alliance Variable Products Series Fund AllianceBernstein Value Portfolio (the "Portfolio") for the annual reporting period ended December 31, 2002. INVESTMENT OBJECTIVE AND POLICIES The Portfolio seeks long-term growth of capital. The Portfolio invests primarily in a diversified portfolio of equity securities of companies with relatively large market capitalizations that Alliance believes are undervalued. In selecting securities for the Portfolio, Alliance's Bernstein unit ("Bernstein") uses fundamental research to identify companies whose long-term earnings power and dividend paying capability are not reflected in the current market price of their securities. The Portfolio may invest up to 15% of its total assets in foreign securities. - -------------------------------------------------------------------------------- INVESTMENT RESULTS Periods Ended December 31, 2002 Total Return Since Inception* ============ AllianceBernstein Value Portfolio 9.50% Russell 1000 Value Index -2.19% Total returns are based on net asset value (NAV) performance for Class A shares and reflect reinvestment of dividends and/or capital gains distributions in additional shares. Total return does not reflect the deduction of taxes that a shareholder would pay on portfolio distributions or the redemption of portfolio shares. These figures do not reflect insurance company separate account or annuity contract charges, which would reduce total return to a contract owner. Past performance does not guarantee future results. Investment return and principal value will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. * The Portfolio's inception date is 7/22/02. The unmanaged Russell 1000 Value Index contains those securities in the Russell 1000 Index with a less-than-average growth orientation. The unmanaged Russell 1000 Index is comprised of the 1000 largest capitalized companies that are traded in the United States. An investor cannot invest directly in an index, and its results are not indicative of the performance for any specific investment, including AllianceBernstein Value Portfolio. - -------------------------------------------------------------------------------- Since the Portfolio's inception on July 22, 2002, through December 31, 2002, the Portfolio returned 9.50%, outperforming its benchmark, the Russell 1000 Value Index. The Index returned -2.19% since the closest month-end after the Portfolio's inception date through December 31, 2002. The Portfolio's outperformance was a result of strong stock selection, particularly in the financial services sector. Several of the traditional thrifts and consumer-oriented banks that the Portfolio emphasizes outperformed their more market-sensitive peers, especially in December. In addition, our HMO holdings added to relative returns. In the utilities sector, a number of our electric companies posted gains as investors flocked to more stable, less cyclical stocks. As a group, services stocks outpaced the market in December. As such, our overweight position in this sector paid off. Stock selection within the sector also lifted returns, as our railroad holdings rebounded from a disappointing November. MARKET REVIEW After two months of gains, the U.S. equity markets fell in December, with the S&P 500 Index down 5.9%. Value and growth stocks declined, though value stocks less so; the Russell 1000 Value Index was down 4.3%, while its growth counterpart, the Russell 1000 Growth Index, fell 6.9%. Stocks that are perceived to be stable, such as utilities and consumer staples, fared best in the down market. Energy companies also held up well, largely due to rising oil prices. Meanwhile, consumer cyclical and technology shares lagged the market. INVESTMENT OUTLOOK The value opportunity, as we measure it, is back to average after a brief spike in early fall. And its composition has once again shifted. Today, an unusually diverse set of companies represents the top quintile of value. We see no massive misvaluations on a sector level. Thus, while our portfolio retains a pro-cyclical tilt, because market anxieties are greatest about stocks that are sensitive to a decline in the economy, our portfolio is more diversified by sector than usual. In this environment, research-based stock selection will be critical to generating a premium. We remain confident in our analysts' ability to uncover attractive investment opportunities. We appreciate your investment in AllianceBernstein Value Portfolio and look forward to reporting further investment progress in the coming period. Sincerely, /s/ Marilyn Fedak Marilyn Fedak Vice President and Portfolio Manager 1 ALLIANCEBERNSTEIN VALUE PORTFOLIO Alliance Variable Products Series Fund ================================================================================ PERFORMANCE UPDATE ALLIANCEBERNSTEIN VALUE PORTFOLIO GROWTH OF A $10,000 INVESTMENT 7/31/02*-12/31/02 [THE FOLLOWING TABLE WAS DEPICTED IN A LINE CHART IN THE PRINTED MATERIAL.] AllianceBernstein Value Portfolio: $9,910 Russell 1000 Value Index: $9,781 AllianceBernstein Value Portfolio Russell 1000 Value Index - -------------------------------------------------------------------------------- 7/31/02* $10,000 $10,000 12/31/02 $9,910 $9,781 Past performance is no guarantee of future results. This chart illustrates the total value of an assumed $10,000 investment in the Portfolio (from 7/31/02* to 12/31/02) as compared to the performance of an appropriate broad-based index. The unmanaged Russell 1000 Value Index contains those securities in the Russell 1000 Index with a less-than-average growth orientation. The unmanaged Russell 1000 Index is comprised of the 1000 largest capitalized companies that are traded in the United States. An investor cannot invest directly in an index, and its results are not indicative of the performance for any specific investment, including AllianceBernstein Value Portfolio. - -------------------------------------------------------------------------------- * Since closest month-end after Portfolio's inception date of 7/22/02. 2 ALLIANCEBERNSTEIN VALUE PORTFOLIO TEN LARGEST HOLDINGS December 31, 2002 Alliance Variable Products Series Fund ================================================================================ - -------------------------------------------------------------------------------- COMPANY U.S. $ VALUE PERCENT OF NET ASSETS - -------------------------------------------------------------------------------- Exxon Mobil Corp. $ 3,389,180 5.0% - -------------------------------------------------------------------------------- Citigroup, Inc. 2,498,490 3.6 - -------------------------------------------------------------------------------- Bank of America Corp. 2,135,799 3.1 - -------------------------------------------------------------------------------- SBC Communications, Inc. 1,726,907 2.5 - -------------------------------------------------------------------------------- ChevronTexaco Corp. 1,450,394 2.1 - -------------------------------------------------------------------------------- Verizon Communications 1,278,750 1.9 - -------------------------------------------------------------------------------- Wachovia Corp. 1,160,614 1.7 - -------------------------------------------------------------------------------- J. P. Morgan Chase & Co. 1,144,800 1.7 - -------------------------------------------------------------------------------- Hewlett-Packard Co. 1,114,998 1.6 - -------------------------------------------------------------------------------- Philip Morris Cos., Inc. 944,349 1.4 ----------- ---- - -------------------------------------------------------------------------------- $16,844,281 24.6% - -------------------------------------------------------------------------------- 3 ALLIANCEBERNSTEIN VALUE PORTFOLIO PORTFOLIO OF INVESTMENTS December 31, 2002 Alliance Variable Products Series Fund ================================================================================ Company Shares U.S. $ Value - -------------------------------------------------------------------------------- COMMON STOCKS-95.9% FINANCIAL-33.6% BANKS-NYC-5.3% Citigroup, Inc. ................................. 71,000 $ 2,498,490 J. P. Morgan Chase & Co. ........................ 47,700 1,144,800 ----------- 3,643,290 ----------- FINANCE-PERSONAL LOANS-0.5% Countrywide Credit Industries, Inc. ............. 6,550 338,308 ----------- LIFE INSURANCE-0.7% MetLife, Inc. ................................... 17,000 459,680 Torchmark, Inc. ................................. 1,300 47,489 ----------- 507,169 ----------- MAJOR REGIONAL BANKS-14.8% AmSouth Bancorp. ................................ 22,000 422,400 Bank of America Corp. ........................... 30,700 2,135,799 Bank One Corp. .................................. 18,100 661,555 Charter One Financial, Inc. ..................... 2,315 66,510 Comerica, Inc. .................................. 11,300 488,612 FleetBoston Financial Corp. ..................... 30,400 738,720 Huntington Bancshares, Inc. ..................... 19,800 370,458 KeyCorp. ........................................ 21,950 551,823 National City Corp. ............................. 22,200 606,504 Regions Financial Corp. ......................... 13,000 433,680 SouthTrust Corp. ................................ 5,500 136,675 Suntrust Banks, Inc. ............................ 10,100 574,892 U.S. Bancorp .................................... 34,500 732,090 Union Planters Corp. ............................ 7,312 205,760 UnionBanCal Corp. ............................... 4,950 194,387 Wachovia Corp. .................................. 31,850 1,160,614 Wells Fargo & Co. ............................... 13,650 639,775 ----------- 10,120,254 ----------- MISCELLANEOUS FINANCIAL-2.5% Goldman Sachs Group, Inc. ....................... 6,275 427,328 Lehman Brothers Holdings, Inc. .................. 7,000 373,030 Merrill Lynch & Co., Inc. ....................... 5,400 204,930 MGIC Investment Corp. ........................... 5,500 227,150 Morgan Stanley, Dean Witter & Co. ........................................ 11,500 459,080 ----------- 1,691,518 ----------- MULTI-LINE INSURANCE-3.0% Aetna, Inc. ..................................... 900 37,008 American International Group, Inc. .............. 10,525 608,871 CIGNA Corp. ..................................... 10,300 423,536 Health Net, Inc. (a) ............................ 13,000 343,200 Humana, Inc. (a) ................................ 25,700 257,000 Oxford Health Plans, Inc. (a) ................... 10,800 393,660 ----------- 2,063,275 ----------- PROPERTY - CASUALTY INSURANCE-3.8% Allstate Corp. .................................. 20,750 767,542 Aon Corp. ....................................... 12,900 243,681 Chubb Corp. ..................................... 7,900 412,380 Old Republic International Corp. ................ 3,500 98,000 St. Paul Cos., Inc. ............................. 13,000 442,650 Travelers Property Casualty Corp. Cl.A (a) ............................... 20,237 296,472 Travelers Property Casualty Corp. Cl.B (a) ............................... 4,598 67,361 XL Capital, Ltd. Cl.A ........................... 3,100 239,475 ----------- 2,567,561 ----------- SAVINGS AND LOAN-3.0% Federal Home Loan Mortgage Corp. ................ 5,700 336,585 Federal National Mortgage Assn. ................. 5,500 353,815 Golden West Financial Corp. ..................... 6,250 448,812 Washington Mutual, Inc. ......................... 25,400 877,062 ----------- 2,016,274 ----------- 22,947,649 ----------- UTILITIES-12.8% ELECTRIC COMPANIES-6.0% Ameren Corp. .................................... 7,000 290,990 American Electric Power Co., Inc. ............... 13,975 381,937 Cinergy Corp. ................................... 12,250 413,070 Consolidated Edison, Inc. ....................... 8,350 357,547 Constellation Energy Group, Inc. ................ 14,500 403,390 Duke Energy Corp. ............................... 32,200 629,188 Entergy Corp. ................................... 10,500 478,695 PPL Corp. ....................................... 11,000 381,480 Puget Energy, Inc. .............................. 9,500 209,475 Reliant Resources, Inc. (a) ..................... 17,600 56,320 Sempra Energy ................................... 17,300 409,145 Westar Energy, Inc. ............................. 3,800 37,620 Xcel Energy, Inc. ............................... 2,150 23,650 ----------- 4,072,507 ----------- TELEPHONE-6.8% AT&T Corp. ...................................... 8,800 229,768 BellSouth Corp. ................................. 21,500 556,205 Qwest Communications International, Inc. (a) .... 69,000 345,000 SBC Communications, Inc. ........................ 63,700 1,726,907 Sprint Corp. .................................... 37,700 545,896 Verizon Communications .......................... 33,000 1,278,750 ----------- 4,682,526 ----------- 8,755,033 ----------- 4 Alliance Variable Products Series Fund ================================================================================ Company Shares U.S. $ Value - -------------------------------------------------------------------------------- ENERGY-10.8% OILS-INTEGRATED DOMESTIC-3.7% Ashland, Inc. ................................. 11,300 $ 322,389 ConocoPhillips ................................ 18,173 879,392 Marathon Oil Corp. ............................ 20,200 430,058 Occidental Petroleum Corp. .................... 16,500 469,425 Valero Energy Corp. ........................... 12,500 461,750 ---------- 2,563,014 ---------- OILS-INTEGRATED INTERNATIONAL-7.1% ChevronTexaco Corp. ........................... 21,817 1,450,394 Exxon Mobil Corp. ............................. 97,000 3,389,180 ---------- 4,839,574 ---------- 7,402,588 ---------- CONSUMER CYCLICALS-10.3% AUTO PARTS-AFTER MARKET-0.8% Genuine Parts Co. ............................. 11,500 354,200 Snap On, Inc. ................................. 7,325 205,906 ---------- 560,106 ---------- AUTOS & AUTO PARTS-2.9% Autoliv, Inc. (Sweden) ........................ 7,000 146,510 Dana Corp. .................................... 18,200 214,032 Delphi Corp. .................................. 36,700 295,435 Ford Motor Co. ................................ 3,000 27,900 General Motors Corp. .......................... 17,900 659,794 Lear Corp. (a) ................................ 9,200 306,176 Magna International, Inc. Cl.A ................ 6,500 364,975 ---------- 2,014,822 ---------- HOME FURNISHINGS-0.5% Leggett & Platt, Inc. ......................... 16,100 361,284 ---------- HOUSEHOLD-APPLIANCES/DURABLES-1.1% Black & Decker Corp. .......................... 4,700 201,583 Maytag Corp. .................................. 10,000 285,000 Whirlpool Corp. ............................... 5,300 276,766 ---------- 763,349 ---------- MISCELLANEOUS CONSUMER CYCLICALS-0.7% Fortune Brands, Inc. .......................... 5,500 255,805 Newell Rubbermaid, Inc. ....................... 7,500 227,475 ---------- 483,280 ---------- RETAILERS-3.3% AutoNation, Inc. (a) .......................... 34,800 437,088 Federated Department Stores, Inc. (a) ......... 16,500 474,540 May Department Stores Co. ..................... 12,000 275,760 Office Depot, Inc. (a) ........................ 25,300 373,428 Sears, Roebuck & Co. .......................... 20,525 491,574 TJX Cos., Inc. ................................ 9,000 175,680 ---------- 2,228,070 ---------- TEXTILES/SHOES-APPAREL MFG.-0.9% Jones Apparel Group, Inc. (a) ................. 10,700 379,208 Liz Claiborne, Inc. ........................... 6,200 183,830 V. F. Corp. ................................... 650 23,432 ---------- 586,470 ---------- TIRES & RUBBER GOODS-0.1% Goodyear Tire & Rubber Co. .................... 9,200 62,652 ---------- 7,060,033 ---------- CONSUMER STAPLES-5.9% BEVERAGES-SOFT, LITE & HARD-0.2% Coca-Cola Enterprises, Inc. ................... 5,100 110,772 ---------- FOODS-1.9% ConAgra Foods, Inc. ........................... 15,500 387,655 Del Monte Foods Co. (a) ....................... 2,087 16,070 H.J. Heinz Co. ................................ 4,675 153,667 Sara Lee Corp. ................................ 17,000 382,670 Tyson Foods, Inc. Cl.A ........................ 32,376 363,259 ---------- 1,303,321 ---------- RESTAURANTS-1.0% McDonald's Corp. .............................. 26,900 432,552 Wendy's International, Inc. ................... 6,850 185,429 Yum! Brands, Inc. (a) ......................... 4,000 96,880 ---------- 714,861 ---------- RETAIL STORES-FOOD-0.7% Safeway, Inc. (a) ............................. 19,000 443,840 SUPERVALU, Inc. ............................... 500 8,255 ---------- 452,095 ---------- SOAPS-0.4% Procter & Gamble Co. .......................... 3,000 257,820 ---------- SUGAR REFINERS-0.3% Archer- Daniels- Midland Co. .................. 19,805 245,582 ---------- TOBACCO-1.4% Philip Morris Cos., Inc. ...................... 23,300 944,349 ---------- 4,028,800 ---------- TECHNOLOGY-5.7% COMMUNICATION-EQUIP. MFRS.-1.6% Corning, Inc. (a) ............................. 111,000 367,410 Nortel Networks Corp. (a) ..................... 266,300 428,743 Tellabs, Inc. (a) ............................. 41,500 301,705 ---------- 1,097,858 ---------- COMPUTERS-2.8% Hewlett-Packard Co. ........................... 64,228 1,114,998 International Business Machines Corp. ......... 9,840 762,600 Quantum Corp. (a) ............................. 15,750 42,053 ---------- 1,919,651 ---------- 5 ALLIANCEBERNSTEIN VALUE PORTFOLIO PORTFOLIO OF INVESTMENTS (continued) Alliance Variable Products Series Fund ================================================================================ Company Shares U.S. $ Value - -------------------------------------------------------------------------------- COMPUTER SERVICES/SOFTWARE-0.2% Electronic Data Systems Corp ..................... 5,500 $ 101,365 ---------- MISCELLANEOUS INDUSTRIAL TECHNOLOGY-0.7% Arrow Electronics, Inc. (a) ...................... 1,200 15,348 Avnet, Inc. (a) .................................. 2,000 21,660 Ingram Micro, Inc. Cl.A (a) ...................... 18,200 224,770 Solectron Corp. (a) .............................. 27,210 96,595 Tech Data Corp. (a) .............................. 5,550 149,628 ---------- 508,001 ---------- SEMI-CONDUCTORS-0.4% Micron Technology, Inc. (a) ...................... 25,600 249,344 ---------- 3,876,219 ---------- COMMODITIES-5.0% CHEMICALS-3.4% Cabot Corp. ...................................... 9,900 262,746 E.I. du Pont de Nemours & Co. .................... 19,775 838,460 Eastman Chemical Co. ............................. 1,600 58,832 FMC Corp. (a) .................................... 6,400 174,848 Praxair, Inc. .................................... 3,750 216,638 The Dow Chemical Co. ............................. 20,300 602,910 The Lubrizol Corp. ............................... 5,050 154,025 ---------- 2,308,459 ---------- PAPER-1.6% Boise Cascade Corp. .............................. 6,500 163,930 Georgia-Pacific Group ............................ 18,850 304,616 International Paper Co. .......................... 13,900 486,083 Smurfit-Stone Container Corp. (a) ................ 7,450 114,663 Temple-Inland, Inc. .............................. 450 20,164 ---------- 1,089,456 ---------- 3,397,915 ---------- CONSUMER GROWTH-4.4% DRUGS-2.9% Bristol-Myers Squibb Co. ......................... 9,650 223,397 Merck & Co., Inc. ................................ 15,000 849,150 Pfizer, Inc. ..................................... 7,075 216,283 Pharmacia Corp. .................................. 3,100 129,580 Schering-Plough Corp. ............................ 24,900 552,780 ---------- 1,971,190 ---------- ENTERTAINMENT-0.6% AOL Time Warner, Inc. (a) ........................ 6,200 81,220 Viacom, Inc. (a) ................................. 3,050 124,318 Walt Disney Co. .................................. 10,600 172,886 ---------- 378,424 ---------- HOSPITAL SUPPLIES-0.0% Abbott Laboratories .............................. 675 27,000 ---------- PUBLISHING-0.3% R.R. Donnelley & Sons Co. ........................ 9,250 201,373 ---------- RADIO-TV BROADCASTING-0.6% Comcast Corp. Cl.A (a) ........................... 14,234 335,495 Liberty Media Corp. Cl.A (a) ..................... 9,200 82,248 ---------- 417,743 ---------- 2,995,730 ---------- CAPITAL EQUIPMENT-2.5% AEROSPACE-DEFENSE-0.1% B.F. Goodrich Corp. .............................. 5,900 108,088 ---------- AUTO TRUCKS-PARTS-1.1% Eaton Corp. ...................................... 5,250 410,077 PACCAR, Inc. ..................................... 7,000 322,910 ---------- 732,987 ---------- ELECTRICAL EQUIPMENT-0.7% Cooper Industries, Ltd. Cl.A ..................... 7,000 255,150 Hubbell, Inc. Cl.B ............................... 6,600 231,924 Thomas & Betts Corp. (a) ......................... 500 8,450 ---------- 495,524 ---------- MISCELLANEOUS CAPITAL GOODS-0.6% Parker-Hannifin Corp. ............................ 9,000 415,170 ---------- 1,751,769 ---------- NON-FINANCIAL-2.3% BUILDING MATERIAL-HEAT/PLUMBING/AIR-0.6% Masco Corp. ...................................... 19,175 403,634 ---------- HOME BUILDING-1.4% Centex Corp. ..................................... 7,550 379,010 KB HOME .......................................... 6,000 257,100 Pulte Homes, Inc. ................................ 6,700 320,729 ---------- 956,839 ---------- MISCELLANEOUS BUILDING-0.3% The Sherwin-Williams Co. ......................... 7,500 211,875 ---------- 1,572,348 ---------- SERVICES-1.9% RAILROADS-1.9% Burlington Northern Santa Fe Corp. ............... 19,900 517,599 CSX Corp. ........................................ 16,600 469,946 Norfolk Southern Corp. ........................... 4,450 88,956 Union Pacific Corp. .............................. 3,800 227,506 ---------- 1,304,007 ---------- 6 Alliance Variable Products Series Fund ================================================================================ Shares or Principal Amount Company (000) U.S. $ Value - -------------------------------------------------------------------------------- INDUSTRIAL COMMODITIES-0.7% PAPER-0.7% MeadWestvaco Corp. ........................... 18,737 $ 462,991 ------------ Total Common Stocks (cost $71,828,967) ....... 65,555,082 ------------ SHORT-TERM INVESTMENT-4.9% TIME DEPOSIT-4.9% State Street Euro Dollar 0.75%, 1/01/03 (cost $3,379,000) ............. $ 3,379 3,379,000 ------------ TOTAL INVESTMENTS-100.8% (cost $75,207,967) .. 68,934,082 Other assets less liabilities-(0.8%) ........ (567,779) ------------ NET ASSETS-100% .............................. $ 68,366,303 ============ - -------------------------------------------------------------------------------- (a) Non income producing security. See Notes to Financial Statements. 7 ALLIANCEBERNSTEIN VALUE PORTFOLIO STATEMENT OF ASSETS AND LIABILITIES December 31, 2002 Alliance Variable Products Series Fund ================================================================================ ASSETS Investments in securities, at value (cost $75,207,967) .... $ 68,934,082 Cash ...................................................... 480 Dividends and interest receivable ......................... 141,110 Receivable for capital stock sold ......................... 19,650 ------------ Total assets .............................................. 69,095,322 ------------ LIABILITIES Payable for investment securities purchased ............... 566,299 Distribution fee payable .................................. 14,477 Payable for capital stock redeemed ........................ 113,966 Advisory fee payable ...................................... 21,392 Accrued expenses .......................................... 12,885 ------------ Total liabilities ......................................... 729,019 ------------ NET ASSETS ................................................... $ 68,366,303 ============ COMPOSITION OF NET ASSETS Capital stock, at par ..................................... $ 7,811 Additional paid-in capital ................................ 75,219,656 Undistributed net investment income ....................... 626,639 Accumulated net realized loss on investment transactions .. (1,213,918) Net unrealized depreciation of investments ................ (6,273,885) ------------ $ 68,366,303 ============ Class A Shares Net assets ................................................ $ 187.23 ============ Shares of capital stock outstanding ....................... 21.375 ============ Net asset value per share ................................. $ 8.76 ============ Class B Shares Net assets ................................................ $ 68,366,116 ============ Shares of capital stock outstanding ....................... 7,811,257 ============ Net asset value per share ................................. $ 8.75 ============ - -------------------------------------------------------------------------------- See Notes to Financial Statements. 8 ALLIANCEBERNSTEIN VALUE PORTFOLIO STATEMENT OF OPERATIONS Year Ended December 31, 2002 Alliance Variable Products Series Fund ================================================================================ INVESTMENT INCOME Dividends (net of foreign taxes withheld of $785) ............... $ 1,197,404 Interest ........................................................ 36,532 ----------- Total investment income ......................................... 1,233,936 ----------- EXPENSES Advisory fee .................................................... 370,200 Distribution fee-Class B ........................................ 124,101 Custodian ....................................................... 78,911 Administrative .................................................. 69,000 Audit and legal ................................................. 37,880 Printing ........................................................ 17,520 Directors' fees and expenses .................................... 3,650 Transfer agency ................................................. 947 Miscellaneous ................................................... 6,353 ----------- Total expenses .................................................. 708,562 Less: expenses waived and reimbursed (see Note B) ............... (106,118) ----------- Net expenses .................................................... 602,444 ----------- Net investment income ........................................... 631,492 ----------- REALIZED AND UNREALIZED LOSS ON INVESTMENT TRANSACTIONS Net realized loss on investment transactions .................... (1,123,959) Net change in unrealized appreciation/depreciation of investments (7,013,699) ----------- Net loss on investment transactions ............................. (8,137,658) ----------- NET DECREASE IN NET ASSETS FROM OPERATIONS ......................... $(7,506,166) ===========
- -------------------------------------------------------------------------------- See Notes to Financial Statements. 9 ALLIANCEBERNSTEIN VALUE PORTFOLIO STATEMENT OF CHANGES IN NET ASSETS Alliance Variable Products Series Fund ================================================================================
Year Ended May 1, 2001(a) December 31, to December 31, 2002 2001 ============ =============== INCREASE (DECREASE) IN NET ASSETS FROM OPERATIONS Net investment income .................................................... $ 631,492 $ 88,633 Net realized loss on investment transactions ............................. (1,123,959) (89,959) Net change in unrealized appreciation/depreciation of investments ........ (7,013,699) 739,814 ------------ ------------ Net increase (decrease) in net assets from operations .................... (7,506,166) 738,488 DIVIDENDS TO SHAREHOLDERS FROM Net investment income Class A ................................................................ -0- -0- Class B ................................................................ (93,486) -0- CAPITAL STOCK TRANSACTIONS Net increase ............................................................. 48,679,834 26,547,633 ------------ ------------ Total increase ........................................................... 41,080,182 27,286,121 NET ASSETS Beginning of period ...................................................... 27,286,121 -0- ------------ ------------ End of period (including undistributed net investment income of $626,639 and $88,633, respectively) .................................... $ 68,366,303 $ 27,286,121 ============ ============
- -------------------------------------------------------------------------------- (a) Commencement of operations. See Notes to Financial Statements. 10 ALLIANCEBERNSTEIN VALUE PORTFOLIO NOTES TO FINANCIAL STATEMENTS December 31, 2002 Alliance Variable Products Series Fund ================================================================================ NOTE A: Significant Accounting Policies The AllianceBernstein Value Portfolio (the "Portfolio") is a series of Alliance Variable Products Series Fund, Inc. (the "Fund"). The Portfolio's investment objective is to seek long-term growth of capital. The Portfolio commenced operations on May 1, 2001. The Fund was in corporated in the State of Maryland on November 17, 1987, as an open-end series investment company. The Fund offers nineteen separately managed pools of assets which have differing investment objectives and policies. The Portfolio offers Class A and Class B shares. Both classes of shares have identical voting, dividend, liquidating and other rights, except that Class B shares bear a distribution expense and have exclusive voting rights with respect to the Class B distribution plan. The Portfolio offers and sells its shares only to separate accounts of certain life insurance companies for the purpose of funding variable annuity contracts and variable life insurance policies. Sales are made without a sales charge at the Portfolio's net asset value per share. The financial statements have been prepared in conformity with accounting principles generally accepted in the United States, which require 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 Portfolio. 1. Security Valuation Portfolio securities traded on a national securities exchange or on a foreign securities exchange (other than foreign securities exchanges whose operations are similar to those of the United States over-the-counter market) or on The Nasdaq Stock Market, Inc., are generally valued at the last reported sales price or if no sale occurred, at the mean of the closing bid and asked prices on that day. Readily marketable securities traded in the over-the-counter market, securities listed on a foreign securities exchange whose operations are similar to the U.S. over-the-counter market, and securities listed on a national securities exchange whose primary market is believed to be over-the-counter (but excluding securities traded on The Nasdaq Stock Market, Inc.) are valued at the mean of the current bid and asked prices. U.S. government and fixed income securities which mature in 60 days or less are valued at amortized cost, unless this method does not represent fair value. Securities for which current market quotations are not readily available are valued at their fair value as determined in good faith by, or in accordance with procedures adopted by, the Board of Directors. Fixed income securities may be valued on the basis of prices obtained from a pricing service when such prices are believed to reflect the fair market value of such securities. 2. Currency Translation Assets and liabilities denominated in foreign currencies and commitments under forward exchange currency contracts are translated into U.S. dollars at the mean of the quoted bid and asked prices of such currencies against the U.S. dollar. Purchases and sales of portfolio investments are translated into U.S. dollars at the rates of exchange prevailing when such securities were acquired or sold. Income and expenses are translated into U.S. dollars at rates of exchange prevailing when accrued. Net realized gain or loss on foreign currency transactions represents foreign exchange gains and losses from sales and maturities of foreign fixed income investments and foreign currency exchange contracts, holding of foreign currencies, currency gains or losses realized between the trade and settlement dates on foreign investment transactions, and the difference between the amounts of dividends, interest and foreign withholding taxes recorded on the Portfolio's books and the U.S. dollar equivalent amounts actually received or paid. Net unrealized currency gains and losses from valuing foreign currency denominated assets and liabilities at period end exchange rates are reflected as a component of net unrealized appreciation or depreciation of investments and foreign currency denominated assets and liabilities. 3. Taxes It is the Portfolio's policy to meet the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute 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. 4. Investment Income and Investment Transactions Dividend income is recorded on the ex-dividend date. Interest income is accrued daily. Investment transactions are accounted for on the date securities are purchased or sold. The Portfolio amortizes premiums and accretes discounts as adjustments to interest income. Investment gains and losses are determined on the identified cost basis. 5. Income and Expenses Expenses attributable to a single portfolio are charged to that portfolio. Expenses of the Fund are charged to each portfolio in proportion to net assets. All income earned and expenses incurred by a portfolio with multi-class shares outstanding, are borne on a pro-rata basis by each 11 ALLIANCEBERNSTEIN VALUE PORTFOLIO NOTES TO FINANCIAL STATEMENTS (continued) Alliance Variable Products Series Fund ================================================================================ outstanding class of shares based on the proportionate interest in the portfolio represented by the net assets of such class, except that the portfolio's Class B shares bear the distribution fees. 6. Dividends and Distributions The Portfolio declares and distributes dividends and distributions from net investment income and net realized gains, respectively, if any, at least annually. Income dividends and capital gains distributions to shareholders are recorded on the ex-dividend date. Income dividends and capital gains distributions are determined in accordance with federal tax regulations and may differ from those determined in accordance 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. During the current fiscal year, there were no permanent differences. - -------------------------------------------------------------------------------- NOTE B: Advisory Fee and Other Transactions with Affiliates Under the terms of an investment advisory agreement, the Portfolio pays Alliance Capital Management L.P. (the "Adviser"), an investment advisory fee at an annual rate of .75 of 1% of the Portfolio's average daily net assets. Such fee is accrued daily and paid monthly. Prior to May 1, 2002, the Adviser agreed to waive its fee and to reimburse the additional operating expenses to the extent necessary to limit total operating expenses on an annual basis to .95% and 1.20% of the average daily net assets for Class A and Class B shares, respectively. Effective May 1, 2002, the Adviser agreed to waive its fee and to reimburse additional operating expenses to the extent necessary to limit total operating expenses on an annual basis to 1.20% and 1.45% of the average daily net assets for Class A and Class B shares, respectively. Any expense waivers or reimbursements are accrued daily and paid monthly. For the year ended December 31, 2002 the Adviser waived fees in the amount of $37,118. Pursuant to the terms of the investment advisory agreement, the Portfolio has agreed to reimburse the Adviser for the cost of providing the Portfolio with certain legal and accounting services. Because of the Adviser's agreement to limit total operating expenses as described above, the Adviser waived reimbursement for such services in the amount of $69,000 for the year ended December 31, 2002. Brokerage commissions paid on investment transactions for the year ended December 31, 2002, amounted to $123,901, of which $73,126 was paid to Sanford C. Bernstein & Co. LLC, an affiliate of the Adviser. The Portfolio compensates Alliance Global Investors Services, Inc., a wholly-owned subsidiary of the Adviser, under a Transfer Agency Agreement for providing personnel and facilities to perform transfer agency services for the Portfolio. Such compensation amounted to $947 for the year ended December 31, 2002. - -------------------------------------------------------------------------------- NOTE C: Distribution Plan The Portfolio has adopted a Distribution Plan (the "Plan") for Class B shares pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the Plan, the Portfolio pays distribution and servicing fees to Alliance Fund Distributors, Inc. (the "Distributor"), a wholly-owned subsidiary of the Adviser, at an annual rate of up to .50 of 1% of the Portfolio's average daily net assets attributable to the Class B shares. The fees are accrued daily and paid monthly. The Board of Directors currently limits payments under the Plan to ..25 of 1% of the Portfolio's average daily net assets attributable to Class B shares. The Plan provides that the Distributor will use such payments in their entirety for distribution assistance and promotional activities. The Portfolio is not obligated under the Plan to pay any distribution and servicing fees in excess of the amounts set forth above. The purpose of the payments to the Distributor under the Plan is to compensate the Distributor for its distribution services with respect to the sale of the Portfolio's Class B shares. Since the Distributor's compensation is not directly tied to its expenses, the amount of compensation received by it under the Plan during any year may be more or less than its actual expenses. For this reason, the Plan is characterized by the staff of the Securities and Exchange Commission as being of the "compensation" variety. In the event that the Plan is terminated or not continued, no distribution and servicing fees (other than current amounts accrued but not yet paid) would be owed by the Portfolio to the Distributor. The Plan also provides that the Adviser may use its own resources to finance the distribution of the Portfolio's shares. 12 Alliance Variable Products Series Fund ================================================================================ NOTE D: Investment Transactions Purchases and sales of investment securities (excluding short-term investments) for the year ended December 31, 2002, were as follows: Purchases: Stocks and debt obligations ..................................................... $ 54,645,453 U.S. government and agencies .................................................... -0- Sales: Stocks and debt obligations ..................................................... $ 5,562,595 U.S. government and agencies .................................................... -0- At December 31, 2002, the cost of investments for federal income tax purposes $75,212,234. Accordingly, gross unrealized appreciation and unrealized depreciation are as follows: Gross unrealized appreciation ................................................... $ 1,744,274 Gross unrealized depreciation ................................................... (8,022,426) ------------ Net unrealized depreciation ..................................................... $ (6,278,152) ============
1. Forward Exchange Currency Contracts The Portfolio may enter into forward exchange currency contracts to hedge its exposure to changes in foreign currency exchange rates on foreign portfolio holdings, to hedge certain firm purchase and sales commitments denominated in foreign currencies and for investment purposes. A forward exchange currency contract is a commitment to purchase or sell a foreign currency on a future date at a negotiated forward rate. The Portfolio may enter into contracts to deliver or receive foreign currency it will receive from or require for its normal investment activities. It may also use contracts in a manner intended to protect foreign currency denominated securities from declines in value due to unfavorable exchange rate movements. The gain or loss arising from the difference between the original contracts and the closing of such contracts is included in net realized gain or loss on foreign currency transactions. Fluctuations in the value of outstanding forward exchange currency contracts are recorded for financial reporting purposes as unrealized gains or losses by the Portfolio. The Portfolio's custodian will place and maintain cash not available for investment or other liquid assets in a separate account of the Portfolio having a value at least equal to the aggregate amount of the Portfolio's commitments under forward exchange currency contracts entered into with respect to position hedges. Risks may arise from the potential inability of a counterparty to meet the terms of a contract and from unanticipated movements in the value of a foreign currency relative to the U.S. dollar. The face or contract amount, in U.S. dollars, reflects the total exposure the Portfolio has in that particular currency contract. At December 31, 2002, the Portfolio had no outstanding forward exchange currency contracts. 2. Option Transactions For hedging and investment purposes, the Portfolio may purchase and write call options and purchase put options on U.S. securities and foreign currencies that are traded on U.S. securities exchanges and over-the-counter markets. The risk associated with purchasing an option is that the Portfolio pays a premium whether or not the option is exercised. Additionally, the Portfolio bears the risk of loss of premium and 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 premiums paid. The proceeds from securities sold through the exercise of put options are decreased by the premiums paid. When the Portfolio writes an option, the premium received by the Portfolio is recorded as a liability and is subsequently adjusted to the current market value of the option written. Premiums received from which written options expire unexercised are recorded by the Portfolio on the expiration date as realized gains from written options. 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 Portfolio has realized a gain or loss. In writ- 13 ALLIANCEBERNSTEIN VALUE PORTFOLIO NOTES TO FINANCIAL STATEMENTS (continued) Alliance Variable Products Series Fund ================================================================================ ing an option, the Portfolio 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 Portfolio could result in the Portfolio selling or buying a security or currency at a price different from the current market value. The Portfolio had no transactions in options written for the year ended December 31, 2002. - -------------------------------------------------------------------------------- NOTE E: Distributions to Shareholders The tax character of distributions paid during the fiscal years ended December 31, 2002 and December 31, 2001 were as follows: 2002 2001 ======= ======== Distributions paid from: Ordinary income .................... $93,486 $ -0- ------- -------- Total distributions paid .............. $93,486 $ -0- ------- -------- As of December 31, 2002, the components of accumulated earnings/(deficit) on a tax basis were as follows: Undistributed ordinary income ......................... $ 626,639 Accumulated capital and other losses .................. (1,209,651)(a) Unrealized appreciation/(depreciation) ................ (6,278,152)(b) ----------- Total accumulated earnings/(deficit) .................. $(6,861,164) =========== (a) On December 31, 2002, the Portfolio had a net capital loss carryforward of $1,124,003 of which $89,959 will expire in the year 2009 and $1,034,044 will expire in the year 2010. To the extent future capital gains are offset by capital loss carryforwards, such gains will not be distributed. Net capital losses incurred after October 31, and within the taxable year are deemed to arise on the first business day of the Portfolio's next taxable year. For the year ended December 31, 2002, the Portfolio deferred to January 1, 2003, post October capital losses of $85,648. (b) The difference between book-basis and tax-basis unrealized appreciation/ (depreciation) is attributable primarily to the tax deferral of losses on wash sales. - -------------------------------------------------------------------------------- NOTE F: Capital Stock There are 1,000,000,000 shares of $.001 par value capital stock authorized, divided into two classes, designated Class A and Class B shares. Each class consists of 500,00,000 authorized shares. Transactions in capital stock were as follows:
=================== =================== SHARES AMOUNT =================== =================== July 22, 2002(a) to July 22, 2002(a) to December 31, December 31, 2002 2002 =================== =================== Class A Shares sold ............................... 21 $ 171 Shares issued in reinvestment of dividends ........................... -0- -0- Shares redeemed ........................... -0- -0- ------------- ------------ Net increase .............................. 21 $ 171 ============= ============
- -------------------------------------------------------------------------------- (a) Commencement of distributions. 14 Alliance Variable Products Series Fund ================================================================================
==================================== ===================================== SHARES AMOUNT ==================================== ===================================== Year Ended May 1, 2001(a) to Year Ended May 1, 2001(a) to December 31, December 31, December 31, December 31, 2002 2001 2002 2001 ============ ================== ============ ================= Class B Shares sold ............................ 6,081,829 2,757,370 $ 57,396,118 $ 26,981,265 Shares issued in reinvestment of dividends ........................ 9,491 -0- 93,485 -0- Shares redeemed ........................ (990,865) (46,568) (8,809,940) (433,632) ---------- ---------- ------------ ------------ Net increase ........................... 5,100,455 2,710,802 $ 48,679,663 $ 26,547,633 ========== ========== ============ ============
- -------------------------------------------------------------------------------- NOTE G: Concentration of Risk Investing in securities of foreign companies or foreign governments involves special risks which include changes in foreign exchange rates and the possibility of future political and economic developments which could adversely affect the value of such securities. Moreover, securities of many foreign companies or foreign governments and their markets may be less liquid and their prices more volatile than those of comparable United States companies or of the United States government. - -------------------------------------------------------------------------------- NOTE H: Joint Credit Facility A number of open-end mutual funds managed by the Adviser, including the Portfolio, participate in a $750 million revolving credit facility (the "Facility") intended to provide short-term financing if necessary, subject to certain restrictions in connection with abnormal redemption activity. Commitment fees related to the Facility are paid by the participating funds and are included in the miscellaneous expenses in the statement of operations. The Portfolio did not utilize the Facility during the year ended December 31, 2002. - -------------------------------------------------------------------------------- (a) Commencement of operations. 15 ALLIANCEBERNSTEIN VALUE PORTFOLIO FINANCIAL HIGHLIGHTS Alliance Variable Products Series Fund ================================================================================ Selected Data For A Share Of Capital Stock Outstanding Throughout The Period ============ CLASS A ============ July 22, 2002(a) to December 31, 2002 ============ Net asset value, beginning of period ......................... $ 8.00 ------- Income From Investment Operations Net investment income (b)(c) ................................. .07 Net realized and unrealized gain on investment transactions .. .69 ------- Net increase in net asset value from operations .............. .76 ------- Net asset value, end of period ............................... $ 8.76 ======= Total Return Total investment return based on net asset value (d) ......... 9.50% Ratios/Supplemental Data Net assets, end of period .................................... $ 187 Ratio to average net assets of: Expenses, net of waivers and reimbursements (e) ........... 1.20% Expenses, before waivers and reimbursements (e) ........... 2.28% Net investment income (c)(e) .............................. 4.22% Portfolio turnover rate ...................................... 12% - -------------------------------------------------------------------------------- See footnote summary on page 17. 16 ALLIANCEBERNSTEIN VALUE PORTFOLIO FINANCIAL HIGHLIGHTS Alliance Variable Products Series Fund ================================================================================ Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
============================ CLASS B ============================ Year May 1, Ended 2001(a) to December 31, December 31, 2002 2001 ============ ============ Net asset value, beginning of period ............................. $ 10.07 $ 10.00 Income From Investment Operations Net investment income (b)(c) ..................................... .12 .08 Net realized and unrealized loss on investment transactions ...... (1.42) (.01) ------- ------- Net increase (decrease) in net asset value from operations ....... (1.30) .07 ------- ------- Less: Dividends Dividends from net investment income ............................. (.02) -0- ------- ------- Net asset value, end of period ................................... $ 8.75 $ 10.07 ======= ======= Total Return Total investment return based on net asset value (d) ............. (12.95)% .70% Ratios/Supplemental Data Net assets, end of period (000's omitted) ........................ $68,366 $27,286 Ratio to average net assets of: Expenses, net of waivers and reimbursements ................... 1.21% 1.20%(e) Expenses, before waivers and reimbursements ................... 1.43% 2.47%(e) Net investment income (c) ..................................... 1.27% 1.29%(e) Portfolio turnover rate .......................................... 12% 4%
- -------------------------------------------------------------------------------- (a) Commencement of operations. (b) Based on average shares outstanding. (c) Net of expenses reimbursed or waived by the Adviser. (d) Total investment return is calculated assuming an initial investment made at the net asset value at the beginning of the period, reinvestment of all dividends and distributions at net asset value during the period, and redemption on the last day of the period. Total Return does not reflect the deductions of taxes that a shareholder would pay on Portfolio distributions or the redemption of Portfolio shares. Total investment return calculated for a period of less than one year is not annualized. (e) Annualized. 17 REPORT OF ERNST & YOUNG LLP INDEPENDENT AUDITORS Alliance Variable Products Series Fund ================================================================================ To the Shareholders and Board of Directors AllianceBernstein Value Portfolio Alliance Variable Products Series Fund, Inc. We have audited the accompanying statement of assets and liabilities, including the portfolio of investments, of the AllianceBernstein Value Portfolio (the "Portfolio"), (one of the portfolios constituting the Alliance Variable Products Series Fund, Inc.) as of December 31, 2002, and the related statement of operations for the year then ended, and the statement of changes in net assets and the financial highlights for each of the periods indicated therein. These financial statements and financial highlights are the responsibility of the Portfolio'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 December 31, 2002, 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 the AllianceBernstein Value Portfolio of the Alliance Variable Products Series Fund, Inc. at December 31, 2002, and the results of its operations for the year then ended, and the changes in its net assets and the financial highlights for each of the indicated periods, in conformity with accounting principles generally accepted in the United States. /s/ Ernst & Young LLP New York, New York February 3, 2003 18 ALLIANCEBERNSTEIN VALUE PORTFOLIO Alliance Variable Products Series Fund ================================================================================ BOARD OF DIRECTORS John D. Carifa, Chairman and President Ruth Block (1) David H. Dievler (1) John H. Dobkin (1) William H. Foulk, Jr. (1) Clifford L. Michel (1) Donald J. Robinson (1) CUSTODIAN State Street Bank and Trust Company 225 Franklin Street Boston, MA 02110 DISTRIBUTOR Alliance Fund Distributors, Inc. 1345 Avenue of the Americas New York, NY 10105 INDEPENDENT AUDITORS Ernst & Young LLP 5 Times Square New York, NY 10036 LEGAL COUNSEL Seward & Kissel One Battery Park Plaza New York, NY 10004 TRANSFER AGENT Alliance Global Investor Services, Inc. P.O. Box 1520 Secaucus, NJ 07096-1520 Toll-free 1-(800) 221-5672 - -------------------------------------------------------------------------------- (1) Member of the Audit Committee. 19 ALLIANCEBERNSTEIN VALUE PORTFOLIO Alliance Variable Products Series Fund ================================================================================ 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 DIRECTORSHIPS ADDRESS, OCCUPATION(S) OVERSEEN BY HELD BY (YEARS OF SERVICE*) DURING PAST 5 YEARS DIRECTOR DIRECTOR - --------------------------------------------------------------------------------------------------------------------- INTERESTED DIRECTOR John D. Carifa,** 57 President, Chief Operating Officer and 114 None 1345 Avenue of the Americas a Director of Alliance Capital Management New York, NY 10105 Corporation ("ACMC"), with which he has (13) been associated since prior to 1998. DISINTERESTED DIRECTORS Ruth Block, #+, 72 Formerly an Executive Vice President and 93 None P.O. Box 4623 Chief Insurance Officer of The Equitable Stamford, CT 06903 Life Assurance Society of the United States; (11) Chairman and Chief Executive Officer of Evlico; formerly a Director of Avon, BP Amoco Corporation (oil and gas), Ecolab Incorporated (specialty chemicals), Tandem Financial Group, and Donaldson Lufkin & Jenrette Securities Corporation. David H. Dievler, #+, 73 Independent consultant. Until December 98 None P.O. Box 167 1994 he was Senior Vice President of ACMC Spring Lake, NJ 07762 responsible for mutual fund administration. (13) 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. John H. Dobkin, #+, 60 Consultant. He was formerly a Senior Advisor 94 None P.O. Box 12 from June 1999 - June 2000 and President Annandale, NY 12504 of Historic Hudson Valley (December 1989 - (11) May 1999). Previously, Director of the National Academy of Design and during 1988-92, he was Director and Chairman of the Audit Committee of ACMC. William H. Foulk, Jr., #+, 70 Investment adviser and an independent 110 None Suite 100 consultant. He was formerly Senior 2 Sound View Drive Manager of Barrett Associates, Inc., a Greenwich, CT 06830 registered investment adviser, with which (13) he had been associated since prior to 1998. He was formerly Deputy Comptroller of the State of New York and, prior thereto, Chief Investment Officer of the New York Bank for Savings.
20 ALLIANCEBERNSTEIN VALUE PORTFOLIO Alliance Variable Products Series Fund ================================================================================
PORTFOLIOS IN FUND OTHER NAME, AGE OF DIRECTOR, PRINCIPAL COMPLEX DIRECTORSHIPS ADDRESS, OCCUPATION(S) OVERSEEN BY HELD BY (YEARS OF SERVICE*) DURING PAST 5 YEARS DIRECTOR DIRECTOR - ---------------------------------------------------------------------------------------------------------------------- DISINTERESTED DIRECTORS (continued) Clifford L. Michel, #+, 63 Senior Counsel of the law firm of Cahill 93 Placer Dome Inc. 15 St. Bernard's Road Gordon & Reindel since February 2001 Gladstone, NJ 07934 and a partner of that firm for more than (11) 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, #+, 68 Senior Counsel to the law firm of Orrick, 92 None 98 Hell's Peak Road Herrington & Sutcliffe since prior to 1998. Weston, VT 05161 Formerly a senior partner and a member of (7) 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.
- -------------------------------------------------------------------------------- * There is no stated term of office for the Directors. ** Mr. Carifa is an "interested director", as defined in the 1940 Act, due to his position as President and Chief Operating Officer of ACMC, the Fund's investment adviser. # Member of the Audit Committee. + Member of the Nominating Committee. 21 ALLIANCEBERNSTEIN VALUE PORTFOLIO Alliance Variable Products Series Fund ================================================================================ Officer Information Certain information concerning the Fund's Officers is listed below.
NAME, ADDRESS* POSITION(S) HELD PRINCIPAL OCCUPATION AND AGE WITH FUND DURING PAST 5 YEARS** - --------------------------------------------------------------------------------------------------------------- John D. Carifa, 57 Chairman & President See biography above. Marilyn G. Fedak, 56 Vice President Chief Investment Officer - U.S. Value Equities and Executive Vice President of ACMC since October 2000. Prior thereto, she was Chief Investment Officer and Chairman of the U.S. Equity Investment Policy Group at Bernstein since prior to 1998. Ranji H. Nagaswami Vice President Senior Vice President of ACMC since 1999. Prior thereto, she was a managing director and co-head of U.S. Fixed Income at UBS Brinson since prior to 1998. Edmund P. Bergan, Jr., 52 Secretary Senior Vice President and the General Counsel of Alliance Fund Distributors, Inc. ("AFD") and Alliance Global Investor Services Inc. ("AGIS"), with which he has been associated since prior to 1998. Mark D. Gersten, 52 Treasurer and Chief Senior Vice President of AGIS and Vice President Financial Officer of AFD, with which he has been associated since prior to 1998. Thomas R. Manley, 51 Controller Vice President of ACMC, 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, AFD, and AGIS are affiliates of the Fund. The Fund's Statement of Additional Information (SAI) has additional information about the Fund's Directors and Officers and is available without charge upon request. Contact your financial representative or Alliance Capital at 800-227-4618 for a free prospectus or SAI. 22 (This page left intentionally blank.) (This page left intentionally blank.) (This page left intentionally blank.) -----END PRIVACY-ENHANCED MESSAGE-----