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THE LATIN AMERICA DOLLAR INCOME FUND, INC.
Terms and Conditions of Dividend Reinvestment
and Cash Purchase Plan
1. You, State Street Bank and Trust Company, will act as Agent
for me, and will open an account for me under the Dividend Reinvestment and Cash
Purchase Plan (the "Plan") in the same name as my present shares are registered,
and put into effect for me the dividend reinvestment option of the Plan as of
the first record date for a dividend or capital gains distribution, and the cash
purchase option of the Plan as of the next appropriate date as provided in
paragraph 5 below, after you receive the Authorization duly executed by me.
Registered shareholders, as well as brokers and nominees, are eligible to
participate in the Plan.
2. Whenever The Latin America Dollar Income Fund, Inc. (the
"Fund") declares an income dividend or a capital gains distribution payable in
common stock or cash at the option of the shareholders, I hereby elect to take
such dividend or distribution entirely in additional shares of common stock of
the Fund to be issued by the Fund, and you shall automatically receive such
shares, including fractions, for my account. If the market price per share of
the Fund's common stock on the valuation date equals or exceeds the net asset
value per share on the valuation date, the number of additional shares to be
credited to my account shall be determined by dividing the dollar amount of the
dividend or capital gains distribution payable on my shares by the greater of
the following amounts per share of the Fund's common stock on the valuation
date: (a) the net asset value, or (b) 95% of the market price. If the market
price per share of the Fund's common stock on the valuation date is less than
the net asset value per share on the valuation date, the number of additional
shares to be credited to my account shall be determined by dividing the dollar
amount of the dividend or capital gains distribution by the market price per
share on the valuation date. The valuation date will be the payment date for the
dividend or, if such date is not a New York Stock Exchange trading date, then
the next preceding New York Stock Exchange trading date.
3. Should the Fund declare an income dividend or capital gains
distribution payable only in cash, you shall apply the amount of such dividend
or distribution on my shares (less my pro rata share of brokerage commissions
incurred with respect to your open-market purchases in connection with the
reinvestment of such dividend or distribution) to the purchase on the open
market of shares of the Fund's common stock for my account. Such purchases will
be made on or shortly after the payment date for such dividend or distribution,
and in no event more than 45 days after such date except where temporary
curtailment or suspension
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of purchase is necessary to comply with applicable provisions of federal
securities law.
4. For all purposes of the Plan: (a) the market price of the
Fund's common stock on a particular date shall be the mean between the highest
and lowest sales prices on the New York Stock Exchange on that date, or, if
there is no sale on such Exchange on that date, then the mean between the
closing bid and asked quotations for such stock on such Exchange on such date
provided, however, that if the valuation date precedes the "ex-dividend" date on
such Exchange for a particular dividend and/or distribution, then the marked
price on such valuation date shall be as determined above, less the per share
amount of the dividend and/or distribution; (b) net asset value per share of the
Fund's common stock on a particular date shall be as determined by or on behalf
of the Fund; and (c) all dividends, distributions and other payments (whether
made in cash or in shares) shall be made net of any applicable withholding tax.
5. I understand that, semi-annually, I have the option of
sending additional funds, in any amount from $100 to $3,000, for the purchase on
the open market of shares of the common stock of the Fund for my account.
Voluntary payments will be invested on or shortly after the 15th of February and
August, and in no event more than 45 days after such dates except where
temporary curtailment or suspension of purchase is necessary to comply with
applicable provisions of federal securities law. Optional cash payments received
from me on or prior to the fifth day preceding the 15th of February or August
will be applied by you to the purchase of additional shares of common stock as
of that investment date. Funds received after the fifth day preceding the 15th
of February or August and prior to the 30th day preceding the next investment
date will be returned to me. No interest will be paid on optional cash payments
held until investment. Consequently, I am strongly urged to make my optional
cash payments shortly before the 15th of February or August. However, I should
allow sufficient time to ensure that my payment is received by you on or prior
to the fifth day preceding the 15th of February or August. Optional cash
payments should be in U.S. funds and be sent by first-class mail, postage
prepaid, only to the following address:
Plan Agent
(The Latin America Dollar Income Fund, Inc.)
c/o State Street Bank and Trust Company
P.O. Box 8200
Boston, MA 02266-8200
Deliveries to any other address do not constitute valid delivery. I
may withdraw my entire voluntary cash payment by written notice received by you
not less than 48 hours before such payment is to be invested.
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6. Investments of voluntary cash payments and other
open-market purchases provided for above may be made on any securities exchange
where the Fund's common stock is traded, in the over-the-counter market or in
negotiated transactions and may be on such terms as to price, delivery and
otherwise as you shall determine. My funds held by you uninvested will not bear
interest, and it is understood that, in any event, you shall have no liability
in connection with any inability to purchase shares within 45 days after the
initial date of such purchase as herein provided, or with the timing of any
purchases effected. You shall have no responsibility as to the value of the
common stock of the Fund acquired for my account. For the purposes of cash
investments you may commingle my funds with those of other shareholders of the
Fund for whom you similarly act as Agent, and the average price (including
brokerage commissions) of all shares purchased by you as Agent shall be the
price per share allocable to me in connection therewith.
7. You may hold my shares acquired pursuant to my
Authorization, together with the shares of other shareholders of the Fund
acquired pursuant to similar authorizations, in noncertificated form in your
name or that of your nominee. You will forward to me any proxy solicitation
material and will vote any shares so held for me only in accordance with the
proxy returned by me to the Fund. Upon my written request, you will deliver to
me, without charge, a certificate or certificates for the full shares.
8. You will confirm to me each acquisition made for my account
as soon as practicable but not later than 60 days after the date thereof. You
will send to me a statement of account confirming the transaction and itemizing
any previous reinvestment activity for the calendar year. A statement reflecting
the amount of cash received by you will be issued on receipt of each cash
deposit. These statements are the record of the cost of shares and should be
retained for tax purposes. Certificates representing shares will not be issued
to me under the Plan unless I so request in writing or unless my account is
terminated. Although I may from time to time have an undivided fractional
interest (computed to four decimal places) in a share of the Fund, no
certificates for a fractional share will be issued. However, dividends and
distributions on fractional shares will be credited to my account. In the event
of termination of my account under the Plan, you will adjust for any such
undivided fractional interest in cash at the market value of the Fund's shares
at the time of termination less the pro rata expense of any sale required to
make such an adjustment.
9. Any stock dividends or split shares distributed by the Fund
on shares held by you for me will be credited to my account. In the event that
the Fund makes available to its shareholders rights to purchase additional
shares or other securities, the shares held for me under the Plan will be added
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to other shares held by me in calculating the number of rights to be issued to
me.
10. Your service fee for handling capital gains distributions
or income dividends will be paid by the Fund. I will be charged a $1.00 service
fee for each voluntary cash investment and a pro rata share of brokerage
commissions on all open market purchases.
11. I may terminate my account under the Plan by notifying you
in writing. Such termination will be effective immediately if my notice is
received by you not less than ten days prior to any dividend or distribution
record date; otherwise such termination will be effective as soon as practicable
upon completion of the reinvestment of capital gains distributions or income
dividends. The Plan may be terminated by you or the Fund upon notice in writing
mailed to me at least 30 days prior to any record date for the payment of any
dividend or distribution by the Fund. Upon any termination you will cause a
certificate or certificates for the full shares for me under the Plan and cash
adjustment for any fraction to be delivered to me without charge.
12. If I elect by notice to you in writing in advance of such
termination to have you sell part or all of my shares and remit the proceeds to
me, you are authorized to deduct a fee of 5% of the gross proceeds, to a maximum
of $3.50, plus brokerage commissions for this transaction and any transfer
taxes. In such case, certificates for withdrawn shares will not be issued to me,
and you will, within ten (10) business days after receipt of such written
notice, cause such shares to be sold at market rates for my account through an
independent entity chosen by you. It should be noted, however, that the Fund's
share price may fluctuate during the period between a request for sale, its
receipt by you, and the ultimate sale in the open market within 10 business
days. This risk should be evaluated by me when considering whether to request
that you sell my shares. The risk of a price decline is borne solely by me. A
check for the proceeds will not be mailed prior to receipt by you of proceeds of
the sale; settlement occurs five (5) business days after the sale of shares.
Information regarding the redemption of shares will be provided to the Internal
Revenue Service (the "IRS").
13. The reinvestment of dividends and capital gains
distribution does not relieve me of any income tax which may be payable on such
dividends and distributions. You will report to me the taxable amount of
dividends and distributions credited to my account. Foreign shareholders who
elect to have their dividends and distributions reinvested and whose dividends
and distributions are subject to United States income tax withholding will have
their dividends and distributions reinvested net of withholding tax. U.S.
shareholders who elect to have their dividends and distribution reinvested will
have their dividends and distributions reinvested net of the 20% back-up
withholding of tax imposed under the Section 3406(a)(i) of the Internal
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Revenue Code of 1986, as amended, if (i) such shareholder has failed to furnish
to the Fund his taxpayer identification number (the "TIN"), which for an
individual is his social security number; (ii) the IRS has notified the Fund
that the TIN furnished by the shareholder is incorrect; (iii) the IRS notifies
the Fund that the shareholder is subject to back-up withholding; or (iv) the
shareholder has failed to certify, under penalties of perjury, that he is not
subject to back-up withholding. Foreign non-corporate shareholders may also be
subject to 20% back-up withholding of tax with respect to long-term capital
gains distributions if they fail to make certain certifications. Shareholders
have previously been requested by the Fund or their brokers to submit all
information and certifications required in order to exempt them from back-up
withholding if such exemption is available to them.
14. These terms and conditions may be amended or supplemented
by you, as Agent, or the Fund at any time or times but, except when necessary or
appropriate to comply with applicable law or the rules or policies of the
Securities and Exchange Commission, any securities exchange on which shares of
the Fund are listed, or any other regulatory authority, only by mailing to me
appropriate written notice at least 30 days prior to the effective date thereof.
The amendment or supplement shall be deemed to be accepted by me unless, prior
to the effective date thereof, you receive written notice of the termination of
my account under the Plan. Any such amendment may include an appointment by you
in your place and stead of a successor Agent under these terms and conditions,
with full power and authority to perform all or any of the acts to be performed
by the Agent under these terms and conditions. Upon any such appointment of an
Agent for the purpose of receiving dividends and distributions, the Fund will be
authorized to pay such successor Agent, for my account, all dividends and
distributions payable on common stock of the Fund held in my name or under the
Plan for retention or application by such successor Agent as provided in these
terms and conditions. Notwithstanding the above, if for any reason operation of
the Plan in accordance with its terms should be come impracticable or
unreasonable under the circumstances then prevailing, or in the judgment of the
Fund's Board of Directors such operation would not be in the interests of the
Fund's shareholders generally, then the Fund's Board of Directors shall have the
authority to amend, effective immediately, the terms of the Plan to the extent
that such amendment does not adversely affect my interests in any material
respect. Appropriate written notice of such amendment shall be given within 30
days of its effective date.
15. You shall at all times act in good faith and agree to use
your best efforts within reasonable limits to insure the accuracy of all
services performed under this Agreement and to comply with applicable law, but
assume no responsibility and shall not be liable for loss or damage due to
errors unless such
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error is caused by your negligence, bad faith, or willful misconduct or that of
your employees.
16. These terms and conditions shall be governed by the laws
of the Commonwealth of Massachusetts.
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