-----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, Rn/pAnzXS/rhZGr6EmRNcJzZT1l5GJnqKhJVpelABooD0bnAHTNEeTFGTBqw7sSm MAXkVYoY/yP7Omhbq2KyCA== 0000940180-96-000548.txt : 19961107 0000940180-96-000548.hdr.sgml : 19961107 ACCESSION NUMBER: 0000940180-96-000548 CONFORMED SUBMISSION TYPE: N-30B-2 PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19960930 FILED AS OF DATE: 19961106 SROS: NYSE SROS: PSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: ZWEIG TOTAL RETURN FUND INC CENTRAL INDEX KEY: 0000836412 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 133474242 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: N-30B-2 SEC ACT: 1940 Act SEC FILE NUMBER: 811-05620 FILM NUMBER: 96655250 BUSINESS ADDRESS: STREET 1: 5 HANOVER SQUARE CITY: NEW YORK STATE: NY ZIP: 10004 BUSINESS PHONE: 2125100360 MAIL ADDRESS: STREET 1: 5 HANOVER SQUARE CITY: NEW YORK STATE: NY ZIP: 10004 N-30B-2 1 OFFICERS AND DIRECTORS Martin E. Zweig, Ph.D. Chairman of the Board and President Jeffrey Lazar Vice President and Treasurer Stuart B. Panish Vice President and Secretary Edward S. Babbitt, Jr. Director Charles H. Brunie Director Elliot S. Jaffe Director Alden C. Olson, Ph.D. Director James B. Rogers, Jr. Director Anthony M. Santomero, Ph.D. Director Robert E. Smith Director INVESTMENT ADVISER Zweig Total Return Advisors, Inc. 900 Third Avenue New York, New York 10022 FUND ADMINISTRATOR Zweig/Glaser Advisers 5 Hanover Square New York, New York 10004 CUSTODIAN Boston Safe Deposit and Trust Company One Boston Place Boston, MA 02109 TRANSFER AGENT First Data Investor Services Group, Inc. P.O. Box 1376 Boston, MA 02104 LEGAL COUNSEL Rosenman & Colin LLP 575 Madison Avenue New York, New York 10022 - -------------------------------------------------------------------------------- This report is transmitted to the shareholders of The Zweig Total Return Fund, Inc. for their information. This is not a prospectus, circular or repre- sentation intended for use in the purchase of shares of the Fund or any securi- ties mentioned in this report. [LOGO OF THE ZWEIG TOTAL RETURN FUND, INC.] QUARTERLY REPORT SEPTEMBER 30, 1996 November 1, 1996 Dear Shareholder: The Zweig Total Return Fund's net asset value increased 1.6% during the quarter ended September 30, 1996, including $0.21 per share in reinvested distributions. For the nine months ended September 30, 1996, the Fund"s net asset value rose 2.0% including $0.63 per share in reinvested distributions. Maintaining our risk-averse policy, the Fund's average overall exposure during the period was 73%. We underperformed the market because our basic mandate is to protect capital in declining markets while earning reasonable returns in rising markets. Our exposure levels were based on my indicators which were reading neutral or low neutral. This worked in our favor in July when the market went down. As my indicators improved, we then raised our exposure somewhat. In retrospect, I wish we had increased it more but our move was in line with my indicators. As we pass through bull, bear, and stagnant markets over the long run, I believe our Fund will continue to provide risk-averse investors with above-average returns. DISTRIBUTION DECLARED In accordance with our policy of distributing 10% of net asset value per year, which equals 0.83% per month (10% divided by 12 months), the Fund announced a distribution of $0.07 per share payable on November 25, 1996 to shareholders of record on November 12, 1996. The amount of the distribution depends on the exact net asset value at the time of declaration. For the November distribution, 0.83% of the Fund's net asset value was equivalent to $0.07 per share. Including this distribution, the Fund's payout since its inception is now $7.40. MARKET OUTLOOK At the close of the third quarter our bond exposure was at 36% compared with 44% on June 30. However we have increased our holdings in the long end and decreased our intermediate term holdings. Consequently, the actual duration of our bonds remains at the four-year level. Since our fully invested portion for bonds would be 62 1/2%, we are at about 58% of a full position (36%/62 1/2%). This is in line with my neutral stance for bonds. Low inflation continues to be the major positive factor for the bond market. With the glaring exception of crude oil, commodity prices have been relatively weak. That would include everything from copper to lumber as reflected in indices compiled by the Commodity Research Bureau and the Journal of Commerce. Bond market momentum is also on the positive side. Bond yields went up by more than 1.2 percentage points or 120 basis points from January to mid-year. Yields then backtracked 30 to 35 basis points to about 6.8% at this writing. Short-term rates have also declined somewhat. On the other hand, we have indicators that measure what the economy is doing. These include such factors as employment data, industrial production, capacity utilization, retail sales, home sales, and consumer confidence. Basically, these indicators are pointing to economic strength and this could be a negative for bonds. The September decision by the Fed not to tighten probably helped bonds in the short run. However, if the economy picks up steam because of the Fed's decision, it could hurt bonds. Our equity holdings were at 24% at the end of the third quarter, unchanged from the level on June 30. With full investment in stocks at 37 1/2% for stocks in our Fund, we are at about 64% of a full position (24%/37 1/2%). This is roughly in accordance with my neutral position on stocks. PORTFOLIO COMPOSITION In accordance with our investment policy guidelines, all of our bonds are U.S. Government obligations. As mentioned earlier, the average duration of the bond portion of our Fund is four years. These bonds are liquid and provide us with the flexibility to respond quickly to changes in market conditions. As has been the case since the beginning of 1995, the majority of our stocks are bought or sold on the basis of a proprietary computer-driven model that uses various value and growth criteria to evaluate and rank the most liquid stocks with the highest dividend yields. There was little change in the composition of our leading industry groups during the third quarter. However our exposure declined in paper and forest products and increased in the oil and retail groups. The retail section is new to our leading categories. Here we have expanded our positions in the following: American Stores, which owns and operates food and drug stores nationwide; TJX Companies, whose chains include T.J. Maxx, Winners Apparel, Ltd., HomeGoods, and Marshalls; and Dayton-Hudson, whose holdings include the Target and Mervyn's chains, as well as many other department stores. At September 30, 1996, oils represented our largest industry group, followed closely by utilities. Other prominent categoriesinclude telecommunications, financial services, technology and retail. Our leading individual company positions include Sprint, BankAmerica, Telefonica de Espana, TJX, United Technologies, Texaco, CSX, Salomon, General Motors, Class H and DuPont. Sincerely, /s/ Martin E. Zweig Martin E. Zweig, Ph.D. Chairman 2 THE ZWEIG TOTAL RETURN FUND, INC. STATEMENT OF NET ASSETS SEPTEMBER 30, 1996 (UNAUDITED)
NUMBER OF SHARES VALUE --------- ----------- Common Stocks 28.49% Aerospace & Defense 1.40% General Motors Corp., Class H.......................... 47,400 $ 2,737,350 Rockwell International Corp. .......................... 33,000 1,860,375 Textron, Inc. ......................................... 11,400 969,000 United Technologies Corp. ............................. 26,600 3,195,325 ----------- 8,762,050 ----------- Automotive 0.92% Chrysler Corp. ........................................ 82,200 2,325,975 Ford Motor Company..................................... 50,200 1,568,750 General Motors Corp. .................................. 38,300 1,838,400 ----------- 5,760,125 ----------- Banks 0.86% BankAmerica Corp. ..................................... 45,400 3,728,475 Chase Manhattan Corp. ................................. 14,000 1,121,750 City National Corp. ................................... 13,700 248,312 Washington Mutual, Inc. ............................... 6,900 257,025 ----------- 5,355,562 ----------- Chemicals 1.62% du Pont (E.I.) de Nemours & Co. ....................... 31,000 2,735,750 Goodrich (B.F.) & Co. ................................. 43,500 1,962,937 Hanna (M.A.) Co. ...................................... 30,000 686,250 Olin Corp. ............................................ 20,900 1,755,600 Rhone-Poulenc Co., S.A., ADR........................... 21,100 590,800 Rohm & Haas Co. ....................................... 36,100 2,364,550 ----------- 10,095,887 ----------- Construction & Farm Equipment 0.61% Caterpillar Inc. ...................................... 24,500 1,846,688 Deere & Co. ........................................... 47,600 1,999,200 ----------- 3,845,888 ----------- Consumer Durables 0.42% Goodyear Tire & Rubber Co. ............................ 39,500 1,821,938 Maytag Corp. .......................................... 35,700 696,150 SPX Corp. ............................................. 3,200 95,600 ----------- 2,613,688 -----------
3 THE ZWEIG TOTAL RETURN FUND, INC. STATEMENT OF NET ASSETS--(CONTINUED) SEPTEMBER 30, 1996 (UNAUDITED)
NUMBER OF SHARES VALUE --------- ---------- Containers & Packaging 0.42% Sea Containers Ltd., Class A.................................... 12,100 $ 237,463 ---------- Finance & Financial Services 1.80% Alex Brown Inc. ................................................ 10,000 578,750 American Bankers Insurance Group, Inc. ......................... 11,500 575,000 Bear Stearns & Co., Inc. ....................................... 74,840 1,740,030 Edwards, (A.G.) Inc. ........................................... 50,100 1,459,163 Fremont General Corp. .......................................... 19,600 578,200 Merrill Lynch & Co., Inc. ...................................... 33,000 2,165,625 PaineWebber Group, Inc. ........................................ 31,400 659,400 PHH Corp. ...................................................... 22,600 672,350 Salomon Inc. ................................................... 62,500 2,851,562 ---------- 11,280,080 ---------- Food & Beverage 0.11% Adolph Coors Co., Class B....................................... 29,900 655,931 ---------- Home Builders & Materials 0.19% Apogee Enterprises, Inc. ....................................... 11,900 416,500 Armstrong World Industries, Inc. ............................... 9,800 611,275 Ryland Group Inc. .............................................. 12,200 181,475 ---------- 1,209,250 ---------- Investment Companies 1.65% Blackrock 2001 Term Trust, Inc. .............................. 29,000 224,750 Blackrock Strategic Term Trust, Inc. ......................... 29,000 224,750 Central European Equity Fund.................................. 6,900 133,688 Clemente Global Growth Fund, Inc. ............................ 13,100 108,075 Emerging Germany Fund, Inc. .................................. 48,700 389,600 Emerging Markets Infrastructure, Inc. ........................ 20,800 226,200 Emerging Markets Telecommunications Fund, Inc. ............... 11,400 200,925 Emerging Mexico Fund, Inc. ................................... 13,500 97,875 Europe Fund, Inc. ............................................ 17,000 265,625 First Iberian Fund, Inc. ..................................... 13,500 119,812 First Israel Fund, Inc. ...................................... 12,000 135,000 France Growth Fund, Inc. ..................................... 24,500 254,187 G.T. Global Developing Markets Fund........................... 6,600 72,600 G.T. Global Eastern Europe Fund............................... 36,400 505,050 Gabelli Equity Trust, Inc. ................................... 25,700 237,725 Gabelli Global Multimedia Trust Fund, Inc. ................... 50,600 347,875 Global Health Sciences Fund, Inc. ............................ 54,600 975,975 John Hancock Bank & Thrift Opportunity Fund................... 21,400 564,425
4
NUMBER OF SHARES VALUE --------- ---------- Investment Companies (Continued) Liberty All-Star Growth Fund, Inc. ........................... 33,400 $ 325,650 Morgan Grenfell Small Cap Fund, Inc. ......................... 31,033 333,605 New Age Media Fund, Inc. ..................................... 17,300 263,825 New Germany Fund, Inc. ....................................... 68,800 946,000 Pilgrim America Bank & Thrift Fund, Inc....................... 20,100 278,887 Royce Value Trust, Inc. ...................................... 55,960 706,495 Schroder Asian Growth Fund.................................... 6,700 81,237 Scudder New Asia Fund......................................... 8,400 110,250 Scudder New Europe Fund, Inc. ................................ 26,900 369,875 Spain Fund, Inc. ............................................. 21,000 207,375 Swiss Helvetia Fund, Inc. .................................... 36,200 769,250 Templeton China World Fund, Inc. ............................. 18,400 213,900 Templeton Dragon Fund, Inc. .................................. 6,900 94,013 Templeton Vietnam Fund, Inc. ................................. 6,600 75,075 Tri-Continental Corp. ........................................ 18,800 470,000 ---------- 10,329,574 ---------- Leisure 0.33% Brunswick Corp. .............................................. 51,700 1,240,800 Fleetwood Enterprises, Inc. .................................. 26,400 811,800 ---------- 2,052,600 ---------- Manufacturing 0.86% Duriron Co., Inc. ............................................ 8,900 235,850 Harsco Corp. ................................................. 8,400 529,200 Ingersoll Rand Co. ........................................... 9,400 446,500 Johnson Controls, Inc. ....................................... 10,400 780,000 Miller (Herman), Inc. ........................................ 29,500 1,194,750 Premark International Inc. ................................... 13,200 249,150 Simpson Industries Inc. ...................................... 15,900 160,987 TRW, Inc. .................................................... 19,000 1,767,000 ---------- 5,363,437 ---------- Metals & Mining 0.38% British Steel, Plc, ADR....................................... 50,700 1,546,350 Oregon Steel Mills Inc. ...................................... 55,500 853,312 ---------- 2,399,662 ----------
5 THE ZWEIG TOTAL RETURN FUND, INC. STATEMENT OF NET ASSETS--(CONTINUED) SEPTEMBER 30, 1996 (UNAUDITED)
NUMBER OF SHARES VALUE --------- ------------ Oil & Oil Services 4.73% Ashland Oil Inc. ..................................... 54,400 $ 2,162,400 British Petroleum Co., Plc, ADR....................... 16,600 2,075,000 Chevron Corp. ........................................ 13,000 814,125 Elf Aquitaine, ADR.................................... 43,300 1,704,938 Helmerich & Payne, Inc. .............................. 21,400 933,575 Kerr-McGee Corp. ..................................... 31,000 1,887,125 Mobil Corp. .......................................... 19,700 2,280,275 Pennzoil Co. ......................................... 38,300 2,025,112 Phillips Petroleum Co. ............................... 60,300 2,577,825 Quaker State Corp. ................................... 31,400 541,650 Repsol S.A., ADR...................................... 51,700 1,712,563 Sun Co., Inc. ........................................ 14,500 333,500 Texaco Inc. .......................................... 34,400 3,164,800 Tosco Corp. .......................................... 41,300 2,266,337 Ultramar Corp. ....................................... 27,700 837,925 Unocal Corp. ......................................... 44,600 1,605,600 USX-Marathon Group, Inc. ............................. 121,500 2,627,438 ------------ 29,550,188 ------------ Paper & Forest Products 0.62% Boise Cascade Corp. .................................. 17,300 588,200 Bowater, Inc. ........................................ 35,400 1,345,200 International Paper Co. .............................. 23,800 1,011,500 Pope & Talbot, Inc. .................................. 10,800 166,050 Westvaco Corp. ....................................... 24,750 733,219 ------------ 3,844,169 ------------ Retail Trade & Services 1.67% American Stores Co.................................... 56,800 2,272,000 Dayton Hudson Inc. ................................... 67,400 2,224,200 Fay's Inc. ........................................... 10,600 135,150 Mercantile Stores Inc. ............................... 13,100 707,400 Ross Stores, Inc...................................... 18,500 666,000 Supervalue Inc........................................ 43,300 1,190,750 TJX Companies Inc..................................... 89,500 3,210,813 ------------ 10,406,313 ------------
6
NUMBER OF SHARES VALUE --------- ----------- Technology 1.70% Applied Materials, Inc. ............................. 11,600(a) $ 320,450 Dell Computer Corp. ................................. 20,400(a) 1,586,100 Digital Equipment Corp. ............................. 32,300(a) 1,154,725 EG&G Inc. ........................................... 20,300 362,863 Harris Corp. ........................................ 36,700 2,390,087 Intel Corp. ......................................... 12,800 1,221,600 International Business Machines Corp. ............... 13,100 1,630,950 Microsoft Corp. ..................................... 14,600(a) 1,925,375 Platinum Software.................................... 53 590 ----------- 10,592,740 ----------- Telecommunications 2.90% BCE Inc. ............................................ 28,400 1,214,100 British Telecommunications Corp. Plc, ADR............ 4,500 251,438 Cincinnati Bell Inc. ................................ 18,700 991,100 GTE Corp. ........................................... 36,300 1,397,550 NYNEX Corp. ......................................... 60,500 2,631,750 Sprint Corp. ........................................ 101,300 3,938,037 Telefonica de Espana, S.A., ADS...................... 57,900 3,220,688 Telefonos de Mexico, S.A., ADS....................... 68,100 2,187,712 U.S. West Inc. ...................................... 76,900 2,287,775 ----------- 18,120,150 ----------- Tobacco 0.29% RJR Nabisco Holdings Corp. .......................... 70,700 1,838,200 ----------- Transportation 0.71% Alexander & Baldwin.................................. 4,600 112,700 APL Ltd. ............................................ 6,600 141,900 British Airways Plc, ADR............................. 8,100 691,538 CSX Corp. ........................................... 62,600 3,161,300 KLM Royal Dutch Airlines, Inc. ...................... 12,700 334,962 ----------- 4,442,400 ----------- Utilities--Electric & Natural Gas 4.68% Allegheny Power Systems, Inc. ....................... 17,000 493,000 American Electric Power Co., Inc. ................... 55,100 2,238,438 Baltimore Gas & Electric Co. ........................ 13,700 357,912 Carolina Power & Light Co., Inc. .................... 23,600 814,200 CINergy Corp. ....................................... 25,800 796,575
7 THE ZWEIG TOTAL RETURN FUND, INC. STATEMENT OF NET ASSETS--(CONTINUED) SEPTEMBER 30,1996 (UNAUDITED)
NUMBER OF SHARES/ PRINCIPAL AMOUNT VALUE ----------- ------------ Utilities--Electric & Natural Gas (Continued) CMS Energy Corp. ................................ 32,000 $ 964,000 Consolidated Natural Gas Co. .................... 10,600 568,425 DQE Inc. ........................................ 37,250 1,038,344 Dominion Resources Inc. ......................... 13,800 520,950 Eastern Enterprises.............................. 10,500 396,375 Edison International Inc. ....................... 75,900 1,356,712 El Paso Natural Gas Co. ......................... 18,400 809,600 Enova Corp. ..................................... 36,200 800,925 Entergy Corp. ................................... 32,400 874,800 GPU Inc. ........................................ 49,100 1,509,825 Illinova Corp. .................................. 48,400 1,282,600 MCN Corp. ....................................... 39,100 1,050,813 New York State Gas & Electric Co. ............... 12,600 277,200 NIPSCO Industries, Inc. ......................... 33,000 1,179,750 NorAm Energy Corp. .............................. 121,900 1,813,262 Pacificorp....................................... 28,600 589,875 PanEnergy Corp. ................................. 61,000 2,112,125 Pinnacle West Capital Corp. ..................... 36,100 1,069,463 Questar Corp. ................................... 13,200 466,950 Sonat, Inc. ..................................... 37,200 1,646,100 Texas Utilities Co. ............................. 55,700 2,207,112 Transcanada Pipeline Ltd. ....................... 46,700 753,038 United Illuminating Co. ......................... 6,500 223,437 Utilicorp United Inc. ........................... 5,300 146,413 Western Resources Inc. .......................... 29,500 859,187 ------------ 29,217,406 ------------ Total Common Stocks............................ 177,972,763 ------------ United States Government & Agency Obligations36.75% Federal National Mortgage Association, 6.85%, 4/5/2004........................................ $10,385,000 10,396,444 United States Treasury Bills, 5.12%, 10/31/1996.. 2,000,000(b) 1,991,467 United States Treasury Bonds, 10.75%, 5/15/2003.. 15,000,000 18,281,250 United States Treasury Bonds, 7.25%, 8/15/2022... 26,000,000 26,528,086 United States Treasury Bonds, 7.50%, 11/15/2024.. 10,400,000 10,985,000 United States Treasury Bonds, 7.625%, 2/15/2025.. 14,000,000 15,036,854 United States Treasury Bonds, 6.875%, 8/15/2025.. 9,500,000 9,354,517 United States Treasury Notes, 6.25%, 8/31/2000... 77,800,000 77,362,375
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PRINCIPAL AMOUNT/ NUMBER OF CONTRACTS VALUE ----------- ------------ United States Government & Agency Obligations (Contin- ued) United States Treasury Notes, 5.625%, 11/30/2000............... $19,745,000 $ 19,171,131 United States Treasury Notes, 7.50%, 2/15/2005.. 31,300,000 32,913,859 United States Treasury Notes, 6.50%, 5/15/2005.. 7,600,000 7,502,614 ------------ Total United States Government & Agency Obligations............ 229,523,597 ------------ Short-Term Investments33.03% Bell Atlantic Network Funding, 5.30%, 10/16/96. 10,000,000 9,977,917 Coca-Cola Co., 5.25%, 10/25/96................. 14,700,000 14,648,550 du Pont (E.I.) de Nemours & Co., 5.33%, 10/2/96.... 9,300,000 9,298,623 Exxon Imperial Inc., 5.33%, 10/15/96.......... 18,900,000 18,860,825 Ford Motor Credit Co., 5.32%, 10/7/96........... 12,400,000 12,389,005 Lucent Technologies Corp., 5.30%, 10/11/96.......... 15,000,000 14,977,917 Merck Co., 5.28%, 10/1/96. 7,700,000 7,700,000 Merrill Lynch & Co., Inc., 5.35%, 10/4/96........... 18,700,000 18,691,663 Met Life Funding, Inc., 5.33%, 10/3/96........... 9,600,000 9,597,157 Mobil Corp., 5.34%, 10/21/96................. 15,500,000 15,454,017 Philip Morris Capital Corp., 5.32%, 10/17/96... 6,100,000 6,085,577 Smithkline Beecham Corp., 5.32%, 10/7/96........... 8,700,000 8,692,286 U.S. West, Inc., 5.30%, 10/8/96.................. 19,400,000 19,380,007 Warner Lambert Co., 5.32%, 10/9/96.................. 15,700,000 15,681,439 Xerox Corp., 5.30%, 10/29/96................. 25,000,000 24,896,944 ------------ Total Short-Term Invest- ments.................. 206,331,927 ------------ Net Unrealized Appreciation on Futures Contracts 0.00% Standard & Poor's 500 In- dex, December 1996 Short 17,788 futures.................. (74)(c) ------------ Total Investments........... 98.28 % 613,846,075 Cash and Other Assets, Less 1.72 10,748,016 Liabilities................ ------ ------------ Net Assets (Equivalent to $8.16 per share based on 76,548,498 shares of capi- 100.00 % $624,594,091 tal stock outstanding)..... ====== ============
- -------- (a) Non-income producing security. (b) This security has been pledged as collateral for futures transactions. (c) The market value of the short futures was $25,586,212 (representing 4.10% of the Fund's net assets) with a cost of $25,604,000. 9 THE ZWEIG TOTAL RETURN FUND, INC. FINANCIAL HIGHLIGHTS SEPTEMBER 30, 1996 (UNAUDITED)
NET ASSET VALUE TOTAL NET ASSETS PER SHARE -------------------------- ----------------- NET ASSET VALUE: Beginning of period: December 31, 1995...................... $647,523,415 $8.63 Net investment income......... $ 19,629,138 $ 0.26 Net realized and unrealized losses on investments........ (7,263,903) (0.10) Dividends from net investment income and distributions from net long- term and short-term capital gains........................ (47,699,460) (0.63) Net asset value of shares is- sued to shareholders for re- investment of dividends and distributions................ 12,404,901 0.00 ------------ -------- Net decrease in net assets/net asset value...... (22,929,324) (0.47) ------------ ------- End of period: September 30, 1996.......................... $624,594,091 $8.16 ============ =======
10 KEY INFORMATION 1-800-331-1710 FIRST DATA INVESTOR SERVICES GROUP, INC.: For questions regarding shareholder accounts P.O. Box 1376 Bos- ton, MA 02104 (212) 486-3122 THE ZWEIG TOTAL RETURN FUND HOT LINE: For updates on net asset value, share price, major industry groups and other key information 1-800-272-2700 ZWEIG SHAREHOLDER RELATIONS: For general information and literature REINVESTMENT PLAN Many of you have questions about the reinvestment plan. We urge shareholders who want to take advantage of this plan and whose shares are held in "Street Name" to consult your broker as soon as possible to determine if you must change registration into your own name to participate. ---------------- Notice is hereby given in accordance with Section 23(c) of the Investment Company Act of 1940 that the Fund may from time to time purchase its shares of common stock in the open market when Fund shares are trading at a discount from their net asset value. 11 -----END PRIVACY-ENHANCED MESSAGE-----