Alliancebernstein High Income Fund Inc – ‘497’ on 2/4/11

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This is filed pursuant to Rule 497(c).                                          
File No. 33-72460 and 811-08188.                                                

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BOND FUNDS (A, B, C AND ADVISOR CLASS SHARES)                                   

PROSPECTUS  |  JANUARY 31, 2011                                                 

The AllianceBernstein Bond Funds                                                

                                                        [Enlarge/Download Table]
                                                                                               
Stability                                          Absolute Return                             
(Shares Offered--Exchange Ticker Symbol)           (Shares Offered--Exchange Ticker Symbol)    

    AllianceBernstein Short Duration Portfolio         AllianceBernstein Diversified Yield Fund
    (Class A-ADPAX; Class B-ADPBX; Class C-ADPCX)      (Class A-AGSAX; Class B-AGSBX;          
                                                         Class C-AGCCX; Advisor Class-AGSIX)   

Core                                               High Income                                 
(Shares Offered--Exchange Ticker Symbol)           (Shares Offered--Exchange Ticker Symbol)    

    AllianceBernstein Intermediate Bond Portfolio      AllianceBernstein High Income Fund      
    (Class A-ABQUX; Class B-ABQBX;                     (Class A-AGDAX; Class B-AGDBX;          
      Class C-ABQCX; Advisor Class-ABQYX)                Class C-AGDCX; Advisor Class-AGDYX)   

    AllianceBernstein Global Bond Fund                                                         
    (Class A-ANAGX; Class B-ANABX;                                                             
      Class C-ANACX; Advisor Class-ANAYX)                                                      

The Securities and Exchange Commission has not approved or disapproved these    
securities or passed upon the adequacy of this Prospectus. Any representation   
to the contrary is a criminal offense.                                          

[LOGO]                                                                
AB                                                                
ALLIANCEBERNSTEIN                                                               

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INVESTMENT PRODUCTS OFFERED                                                     
..  ARE NOT FDIC INSURED                                                        
..  MAY LOSE VALUE                                                              
..  ARE NOT BANK GUARANTEED                                                     

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TABLE OF CONTENTS                                                               
--------------------------------------------------------------------------------

                                                                [Download Table]

                                                               Page
                                                                   
SUMMARY INFORMATION...........................................   4 
STABILITY                                                          
  ALLIANCEBERNSTEIN SHORT DURATION PORTFOLIO..................   4 
CORE                                                               
  ALLIANCEBERNSTEIN INTERMEDIATE BOND PORTFOLIO...............   8 
  ALLIANCEBERNSTEIN GLOBAL BOND FUND..........................  12 
ABSOLUTE RETURN                                                    
  ALLIANCEBERNSTEIN DIVERSIFIED YIELD FUND....................  16 
HIGH INCOME                                                        
  ALLIANCEBERNSTEIN HIGH INCOME FUND..........................  20 
ADDITIONAL INFORMATION ABOUT THE FUNDS' RISKS AND INVESTMENTS.  26 
INVESTING IN THE FUNDS........................................  35 
  How to Buy Shares...........................................  35 
  The Different Share Class Expenses..........................  36 
  Sales Charge Reduction Programs.............................  37 
  CDSC Waivers and Other Programs.............................  39 
  The "Pros" and "Cons" of Different Share Classes............  39 
  Payments to Financial Advisors and Their Firms..............  40 
  How to Exchange Shares......................................  41 
  How to Sell or Redeem Shares................................  41 
  Frequent Purchases and Redemptions of Fund Shares...........  42 
  How the Funds Value Their Shares............................  43 
MANAGEMENT OF THE FUNDS.......................................  44 
DIVIDENDS, DISTRIBUTIONS AND TAXES............................  49 
GENERAL INFORMATION...........................................  50 
GLOSSARY OF INVESTMENT TERMS..................................  51 
FINANCIAL HIGHLIGHTS..........................................  52 
APPENDIX A--BOND RATINGS...................................... A-1 
APPENDIX B--HYPOTHETICAL INVESTMENT AND EXPENSE INFORMATION... B-1 

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SUMMARY INFORMATION                                                             
--------------------------------------------------------------------------------

ALLIANCEBERNSTEIN SHORT DURATION PORTFOLIO                                      
--------------------------------------------------------------------------------

INVESTMENT OBJECTIVE                                                            
The Fund seeks to provide safety of principal and a moderate rate of return     
that is subject to taxes.                                                       

FEES AND EXPENSES OF THE FUND                                                   
This table describes the fees and expenses that you may pay if you buy and hold 
shares of the Fund. You may qualify for sales charge reductions if you and      
members of your family invest, or agree to invest in the future, at least       
$100,000 in AllianceBernstein Mutual Funds. More information about these and    
other discounts is available from your financial intermediary and in Investing  
in the Funds--Sales Charge Reduction Programs on page 37 of this Prospectus and 
in Purchase of Shares--Sales Charge Reduction Programs on page 43 of the Fund's 
Statement of Additional Information ("SAI").                                    

SHAREHOLDER FEES (fees paid directly from your investment)                      

                                                        [Enlarge/Download Table]

                                                                                        CLASS B SHARES          
                                                                                        (NOT CURRENTLY          
                                                                                CLASS A   OFFERED TO   CLASS C  
                                                                                SHARES  NEW INVESTORS) SHARES   
----------------------------------------------------------------------------------------------------------------
                                                                                                                
Maximum Sales Charge (Load) Imposed on Purchases                                                                
(as a percentage of offering price)                                              4.25%        None        None  
----------------------------------------------------------------------------------------------------------------
Maximum Deferred Sales Charge (Load)                                                                            
(as a percentage of offering price or redemption proceeds, whichever is lower)   None       3.00%(a)    1.00%(b)
----------------------------------------------------------------------------------------------------------------
Exchange Fee                                                                     None         None        None  

ANNUAL FUND OPERATING EXPENSES (expenses that you pay each year as a percentage 
of the value of your investment)                                                

                                                                [Download Table]

                                          CLASS A CLASS B CLASS C
-----------------------------------------------------------------
                                                                 
Management Fees                            .45%     .45%    .45% 
Distribution and/or Service (12b-1) Fees   .30%    1.00%   1.00% 
Other Expenses:                                                  
  Transfer Agent                           .10%     .15%    .11% 
  Other Expenses                           .09%     .09%    .09% 
                                           ----    -----   ----- 
Total Other Expenses                       .19%     .24%    .20% 
                                           ----    -----   ----- 
Total Annual Fund Operating Expenses       .94%    1.69%   1.65% 
                                           ====    =====   ===== 
-----------------------------------------------------------------

(a)Class B shares automatically convert to Class A shares after six years. The  
 contingent deferred sales charge, or CDSC, decreases over time. For Class B
shares, the CDSC decreases 1.00% annually to 0% after the third year.     

(b)For Class C shares, the CDSC is 0% after the first year.                     

EXAMPLES                                                                        
The Examples are intended to help you compare the cost of investing in the Fund 
with the cost of investing in other mutual funds. The Examples assume that you  
invest $10,000 in the Fund for the time periods indicated and then redeem all   
of your shares at the end of those periods. The Examples also assume that your  
investment has a 5% return each year and that the Fund's operating expenses     
stay the same. Although your actual costs may be higher or lower, based on      
these assumptions your costs would be:                                          

                                                                [Download Table]

                CLASS A CLASS B CLASS C
---------------------------------------
                                       
After 1 Year    $  517  $  472  $  268 
After 3 Years   $  712  $  633  $  520 
After 5 Years   $  923  $  918  $  897 
After 10 Years  $1,531  $1,616  $1,955 
---------------------------------------

4                                                                               

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You would pay the following expenses if you did not redeem your shares at the   
end of period:                                                                  

                                                                [Download Table]

                CLASS A CLASS B CLASS C
---------------------------------------
                                       
After 1 Year    $  517  $  172  $  168 
After 3 Years   $  712  $  533  $  520 
After 5 Years   $  923  $  918  $  897 
After 10 Years  $1,531  $1,616  $1,955 
---------------------------------------

PORTFOLIO TURNOVER                                                              
The Fund will pay transaction costs, such as commissions, when it buys or sells 
securities (or "turns over" its portfolio). A higher portfolio turnover may     
indicate higher transaction costs and may result in higher taxes when Fund      
shares are held in a taxable account. These transaction costs, which are not    
reflected in the Annual Fund Operating Expenses or in the Examples, affect the  
Fund's performance. During the most recent fiscal year, the Fund's portfolio    
turnover rate was 107% of the average value of its portfolio.                   

PRINCIPAL STRATEGIES                                                            
The Fund invests at least 80% of its total assets in securities rated A or      
better by national ratings agencies (or, if unrated, determined by the Adviser  
to be of comparable quality) and comparably rated commercial paper and notes.   
The Fund may purchase many types of fixed-income securities, including          
corporate bonds, notes, U.S. Government and agency securities, asset-backed     
securities, mortgage-related securities, inflation-protected securities, loan   
participations and preferred stock, as well as others. The Fund also may invest 
up to 20% of its total assets in foreign fixed-income securities in developed   
or emerging market countries. The Fund also may invest up to 20% of its total   
assets in fixed-income securities rated BB or B by national rating agencies,    
which are not investment grade.                                                 

The Fund may invest up to 20% of its fixed-income securities rated BB or B by   
national rating agencies, which are not investment grade (commonly known as     
"junk bonds").                                                                  

The Fund seeks to maintain an effective duration of one to three years under    
normal market conditions. Duration is a measure that related the expected price 
volatility of a security to changes in interest rates. The duration of a debt   
security is the weighted average time to maturity expressed in years, of the    
present value of all future cash flows, including coupon payments and principal 
repayments. Thus, by definition, duration is always less than or equal to full  
maturity.                                                                       

In managing the Fund, the Adviser may use interest rate forecasting to          
determine the best level of interest rate risk at a given time. The Fund may    
moderately shorten its average duration when the Adviser expects interest rates 
to rise and modestly lengthen its average duration when the Adviser anticipates 
that rates will fall.                                                           

The Adviser selects securities for purchase or sale based on its assessment of  
the securities' risk and return characteristics as well as the securities'      
impact on the overall risk and return characteristics of the Fund. In making    
this assessment, the Adviser takes into account various factors including the   
credit quality and sensitivity to interest rates of the securities under        
consideration and of the Fund's other holdings.                                 

The Fund may invest, without limit, in derivatives, such as options, futures,   
forwards and swaps. The Fund also may invest up to 20% of its assets in         
structured instruments, which have characteristics of futures, options,         
currencies, and securities.                                                     

PRINCIPAL RISKS                                                                 
..  MARKET RISK: The value of the Fund's assets will fluctuate as the stock or  
 bond market fluctuates. The value of its investments may decline, sometimes
rapidly and unpredictably, simply because of economic changes or other    
events that affect large portions of the market.                          

..  INTEREST RATE RISK: Changes in interest rates will affect the value of      
 investments in fixed-income securities. When interest rates rise, the value
  of investments in fixed-income securities tends to fall and this decrease in
  value may not be offset by higher income from new investments. Interest rate
  risk is generally greater for fixed-income securities with longer maturities
or durations.                                                             

                                                                           5

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..  CREDIT RISK: An issuer or guarantor of a fixed-income security, or the      
 counterparty to a derivatives or other contract, may be unable or unwilling
 to make timely payments of interest or principal, or to otherwise honor its
 obligations. The issuer or guarantor may default causing a loss of the full
  principal amount of a security. The degree of risk for a particular security
may be reflected in its credit rating. There is the possibility that the  
credit rating of a fixed-income security may be downgraded after purchase,
which may adversely affect the value of the security. Investments in      
fixed-income securities with lower ratings ("junk bonds") tend to have a  
higher probability that an issuer will default or fail to meet its payment
obligations.                                                              

..  INFLATION RISK: This is the risk that the value of assets or income from    
investments will be less in the future as inflation decreases the value of
  money. As inflation increases, the value of the Fund's assets can decline as
can the value of the Fund's distributions. This risk is significantly     
greater if the Fund invests a significant portion of its assets in        
fixed-income securities with longer maturities.                           

..  FOREIGN (NON-U.S.) RISK: Investments in securities of non-U.S. issuers may  
  involve more risk than those of U.S. issuers. These securities may fluctuate
  more widely in price and may be less liquid due to adverse market, economic,
political, regulatory or other factors.                                   

..  CURRENCY RISK: Fluctuations in currency exchange rates may negatively affect
the value of the Fund's investments or reduce its returns.                

..  PREPAYMENT RISK: The value of mortgage-related or asset-backed securities   
  may be particularly sensitive to changes in prevailing interest rates. Early
payments of principal on some mortgage-related securities may occur during
periods of falling mortgage interest rates and expose the Fund to a lower 
rate of return upon reinvestment of principal. Early payments associated  
with mortgage-related securities cause these securities to experience     
significantly greater price and yield volatility than is experienced by   
traditional fixed-income securities. During periods of rising interest    
rates, a reduction in prepayments may increase the effective life of      
mortgage-related securities, subjecting them to greater risk of decline in
market value in response to rising interest rates. If the life of a       
mortgage-related security is inaccurately predicted, the Fund may not be  
able to realize the rate of return it expected.                           

..  LEVERAGE RISK: To the extent the Fund uses leveraging techniques, its net   
asset value, or NAV, may be more volatile because leverage tends to       
exaggerate the effect of changes in interest rates and any increase or    
decrease in the value of the Fund's investments.                          

..  LIQUIDITY RISK: Liquidity risk exists when particular investments are       
  difficult to purchase or sell, possibly preventing the Fund from selling out
of these illiquid securities at an advantageous price. Derivatives and    
securities involving substantial market and credit risk tend to involve   
greater liquidity risk. The Fund is subject to liquidity risk because the 
   market for municipal securities is generally smaller than many other markets.

..  DERIVATIVES RISK: Investments in derivatives may be illiquid, difficult to  
price, and leveraged so that small changes may produce disproportionate   
losses for the Fund, and may be subject to counterparty risk to a greater 
degree than more traditional investments.                                 

..  MANAGEMENT RISK: The Fund is subject to management risk because it is an    
actively managed investment fund. The Adviser will apply its investment   
  techniques and risk analyses in making investment decisions, but there is no
guarantee that its techniques will produce the intended results.          

As with all investments, you may lose money by investing in the Fund.           

BAR CHART AND PERFORMANCE INFORMATION                                           
The bar chart and performance information provide an indication of the          
historical risk of an investment in the Fund by showing:                        

..  how the Fund's performance changed from year to year over the life of the   
Fund; and                                                                 

..  how the Fund's average annual returns for one and five years and over the   
 life of the Fund compare to those of a broad-based securities market index.

You may obtain updated performance information on the Fund's website at         
www.AllianceBernstein.com (click on "Pricing & Performance").                   

The Fund's past performance before and after taxes, of course, does not         
necessarily indicate how it will perform in the future.                         

6                                                                               

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BAR CHART                                                                       
The annual returns in the bar chart are for the Fund's Class A shares and do    
not reflect sales loads. If sales loads were reflected, returns would be less   
than those shown.                                                               

[CHART] 

01     02     03     04     05     06     07     08      09     10      
----   ----   ----   ----   ----   ----   ----   ------  ----   ----      
n/a    n/a    n/a   0.92   1.02   3.75   3.50   -4.18   6.52   2.90     

Calendar Year End (%) 

During the period shown in the bar chart, the Fund's:                           

BEST QUARTER WAS UP 2.32% IN THE 3RD QUARTER, 2009; AND WORST QUARTER WAS DOWN  
-1.79% IN THE 1ST QUARTER, 2008.                                                

PERFORMANCE TABLE                                                               
AVERAGE ANNUAL TOTAL RETURNS                                                    
(For the periods ended December 31, 2010)                                       

                                                        [Enlarge/Download Table]

                                                                                         SINCE   
                                                                        1 YEAR 5 YEARS INCEPTION*
-------------------------------------------------------------------------------------------------
                                                                                                 
Class A**  Return Before Taxes                                          -1.48%  1.54%    1.37%   
           --------------------------------------------------------------------------------------
           Return After Taxes on Distributions                          -1.90%  0.44%    0.33%   
           --------------------------------------------------------------------------------------
           Return After Taxes on Distributions and Sale of Fund Shares  -0.96%  0.67%    0.56%   
-------------------------------------------------------------------------------------------------
Class B    Return Before Taxes                                          -0.77%  1.72%    1.38%   
-------------------------------------------------------------------------------------------------
Class C    Return Before Taxes                                           1.18%  1.73%    1.23%   
-------------------------------------------------------------------------------------------------
BofA Merrill Lynch 1-3 Year Treasury Index                                                       
(reflects no deduction for fees, expenses, or taxes)                     2.35%  4.17%    3.17%   
-------------------------------------------------------------------------------------------------

* Inception date for Class A, Class B and Class C shares: 5/21/03.              

**After-tax returns:                                                            

-Are shown for Class A shares only and will vary for Class B and Class C  
shares because these Classes have different expense ratios;             

-Are an estimate, which is based on the highest historical individual     
federal marginal income tax rates and do not reflect the impact of state
and local taxes; actual after-tax returns depend on an individual       
investor's tax situation and are likely to differ from those shown; and 

-Are not relevant to investors who hold Fund shares through tax-deferred  
arrangements such as 401(k) plans or individual retirement accounts.    

INVESTMENT ADVISER                                                              
AllianceBernstein L.P. is the investment adviser for the Fund.                  

PORTFOLIO MANAGER                                                               
The following table lists the persons responsible for day-to-day management of  
the Fund's portfolio:                                                           

                                                                [Download Table]

EMPLOYEE            LENGTH OF SERVICE  TITLE                                
----------------------------------------------------------------------------
                                                                            
Jon P. Denfeld         Since 2008      Vice President of the Adviser        

Shawn E. Keegan        Since 2005      Vice President of the Adviser        

Alison M. Martier      Since 2009      Senior Vice President of the Adviser 

Douglas J. Peebles     Since 2009      Senior Vice President of the Adviser 

Greg J. Wilensky       Since 2009      Senior Vice President of the Adviser 

ADDITIONAL INFORMATION                                                          
For important information about the purchase and sale of Fund shares, tax       
information and financial intermediary compensation, please turn to ADDITIONAL  
INFORMATION ABOUT PURCHASE AND SALE OF FUND SHARES, TAXES AND FINANCIAL         
INTERMEDIARIES, page 25 in this Prospectus.                                     

                                                                           7

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ALLIANCEBERNSTEIN INTERMEDIATE BOND PORTFOLIO                                   
--------------------------------------------------------------------------------

INVESTMENT OBJECTIVE                                                            
The Fund's investment objective is to generate income and price appreciation    
without assuming what the Adviser considers undue risk.                         

FEES AND EXPENSES OF THE FUND                                                   
This table describes the fees and expenses that you may pay if you buy and hold 
shares of the Fund. You may qualify for sales charge reductions if you and      
members of your family invest, or agree to invest in the future, at least       
$100,000 in AllianceBernstein Mutual Funds. More information about these and    
other discounts is available from your financial intermediary and in Investing  
in the Funds--Sales Charge Reduction Programs on page 37 of this Prospectus and 
in Purchase of Shares--Sales Charge Reduction Programs on page 108 of the       
Funds' SAI.                                                                     

SHAREHOLDER FEES (fees paid directly from your investment)                      

                                                        [Enlarge/Download Table]

                                                               CLASS B SHARES                            
                                                   CLASS A (NOT CURRENTLY OFFERED CLASS C   ADVISOR CLASS
                                                   SHARES    TO NEW INVESTORS)    SHARES       SHARES    
---------------------------------------------------------------------------------------------------------
                                                                                                         
Maximum Sales Charge (Load) Imposed on Purchases                                                         
(as a percentage of offering price)                 4.25%            None            None       None     
---------------------------------------------------------------------------------------------------------
Maximum Deferred Sales Charge (Load)                                                                     
(as a percentage of offering price or redemption                                                         
proceeds, whichever is lower)                       None           3.00%(a)        1.00%(b)     None     
---------------------------------------------------------------------------------------------------------
Exchange Fee                                        None             None            None       None     

ANNUAL FUND OPERATING EXPENSES (expenses that you pay each year as a percentage 
of the value of your investment)                                                

                                                        [Enlarge/Download Table]

                                                                                       CLASS A CLASS B CLASS C ADVISOR CLASS
----------------------------------------------------------------------------------------------------------------------------
                                                                                                                            
Management Fees                                                                          .45%    .45%    .45%       .45%    
Distribution and/or Service (12b-1) Fees                                                 .30%   1.00%   1.00%       None    
Other Expenses:                                                                                                             
  Transfer Agent                                                                         .17%    .22%    .18%       .17%    
  Interest Expense and Related Expenses                                                  .06%    .07%    .06%       .05%    
  Other Expenses                                                                         .13%    .14%    .14%       .13%    
                                                                                       ------  ------  ------     ------    
Total Other Expenses                                                                     .36%    .43%    .38%       .35%    
                                                                                       ------  ------  ------     ------    
Total Annual Fund Operating Expenses                                                    1.11%   1.88%   1.83%       .80%    
                                                                                       ======  ======  ======     ======    
  Fee Waiver and/or Expense Reimbursement(c)                                           (.20)%  (.26)%  (.22)%     (.20)%    
                                                                                       ------  ------  ------     ------    
Total Annual Fund Operating Expenses After Fee Waiver and/or Expense Reimbursement(d)    .91%   1.62%   1.61%       .60%    
                                                                                       ======  ======  ======     ======    
----------------------------------------------------------------------------------------------------------------------------

(a)Class B shares automatically convert to Class A shares after six years. The  
CDSC decreases over time. For Class B shares, the CDSC decreases 1.00%    
annually to 0% after the third year.                                      

(b)For Class C shares, the CDSC is 0% after the first year.                     

(c)The fee waiver and/or expense reimbursements will remain in effect until     
January 31, 2012 and will continue thereafter from year-to-year unless the
Adviser provides notice of termination 60 days prior to the end of the    
Fund's fiscal year.                                                       

(d)If interest expenses were excluded, net expenses would be as follows:        

                                                                [Download Table]

CLASS A CLASS B CLASS C ADVISOR CLASS
-------------------------------------
                                     
 .85%    1.55%   1.55%      .55%     

8                                                                               

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EXAMPLES                                                                        
The Examples are intended to help you compare the cost of investing in the Fund 
with the cost of investing in other mutual funds. The Examples assume that you  
invest $10,000 in the Fund for the time periods indicated and then redeem all   
of your shares at the end of those periods. The Examples also assume that your  
investment has a 5% return each year, that the Fund's operating expenses stay   
the same and that the fee waiver is in effect for only the first year. Although 
your actual costs may be higher or lower, based on these assumptions your costs 
would be:                                                                       

                                                                [Download Table]

                CLASS A CLASS B CLASS C ADVISOR CLASS
-----------------------------------------------------
                                                     
After 1 Year    $  514  $  465  $  264      $ 61     
After 3 Years   $  744  $  666  $  554      $235     
After 5 Years   $  992  $  992  $  970      $425     
After 10 Years  $1,702  $1,794  $2,130      $971     
-----------------------------------------------------

You would pay the following expenses if you did not redeem your shares at the   
end of period:                                                                  

                                                                [Download Table]

                CLASS A CLASS B CLASS C ADVISOR CLASS
-----------------------------------------------------
                                                     
After 1 Year    $  514  $  165  $  164      $ 61     
After 3 Years   $  744  $  566  $  554      $235     
After 5 Years   $  992  $  992  $  970      $425     
After 10 Years  $1,702  $1,794  $2,130      $971     
-----------------------------------------------------

PORTFOLIO TURNOVER                                                              
The Fund will pay transaction costs, such as commissions, when it buys or sells 
securities (or "turns over" its portfolio). A higher portfolio turnover may     
indicate higher transaction costs and may result in higher taxes when Fund      
shares are held in a taxable account. These transaction costs, which are not    
reflected in the Annual Fund Operating Expenses or in the Examples, affect the  
Fund's performance. During the most recent fiscal year, the Fund's portfolio    
turnover rate was 99% of the average value of its portfolio.                    

PRINCIPAL STRATEGIES                                                            
The Fund invests, under normal circumstances, at least 80% of its net assets in 
fixed-income securities. The Fund expects to invest in readily marketable       
fixed-income securities with a range of maturities from short- to long-term and 
relatively attractive yields that do not involve undue risk of loss of capital. 
The Fund expects to invest in fixed-income securities with a dollar-weighted    
average maturity of between three to ten years and an average duration of three 
to six years. The Fund may invest up to 25% of its net assets in below          
investment grade bonds. The Fund may use leverage for investment purposes.      

The Fund may invest without limit in U.S. Dollar-denominated foreign            
fixed-income securities and may invest up to 25% of its assets in               
non-U.S. Dollar-denominated foreign fixed-income securities. These investments  
may include, in each case, developed and emerging market debt securities.       

The Adviser selects securities for purchase or sale based on its assessment of  
the securities' risk and return characteristics as well as the securities'      
impact on the overall risk and return characteristics of the Fund. In making    
this assessment, the Adviser takes into account various factors including the   
credit quality and sensitivity to interest rates of the securities under        
consideration and of the Fund's other holdings.                                 

The Fund may invest in mortgage-related and other asset-backed securities, loan 
participations, inflation-protected securities, structured securities,          
variable, floating, and inverse floating rate instruments and preferred stock,  
and may use other investment techniques. The Fund intends, among other things,  
to enter into transactions such as reverse repurchase agreements and dollar     
rolls. The Fund may invest, without limit, in derivatives, such as options,     
futures, forwards, or swap agreements.                                          

The Fund expects to engage in active and frequent trading of portfolio          
securities to achieve its principal investment strategies. A higher rate of     
portfolio turnover increases transaction expenses, which may negatively affect  
the Fund's performance. High portfolio turnover also may result in the          
realization of substantial net short-term capital gains, which, when            
distributed, are taxable to shareholders.                                       

PRINCIPAL RISKS                                                                 
..  MARKET RISK: The value of the Fund's assets will fluctuate as the stock or  
 bond market fluctuates. The value of its investments may decline, sometimes
rapidly and unpredictably, simply because of economic changes or other    
events that affect large portions of the market.                          

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..  INTEREST RATE RISK: Changes in interest rates will affect the value of      
 investments in fixed-income securities. When interest rates rise, the value
  of investments in fixed-income securities tends to fall and this decrease in
  value may not be offset by higher income from new investments. Interest rate
  risk is generally greater for fixed-income securities with longer maturities
or durations.                                                             

..  CREDIT RISK: An issuer or guarantor of a fixed-income security, or the      
 counterparty to a derivatives or other contract, may be unable or unwilling
 to make timely payments of interest or principal, or to otherwise honor its
 obligations. The issuer or guarantor may default causing a loss of the full
  principal amount of a security. The degree of risk for a particular security
may be reflected in its credit rating. There is the possibility that the  
credit rating of a fixed-income security may be downgraded after purchase,
which may adversely affect the value of the security.                     

..  BELOW INVESTMENT GRADE SECURITIES: Investments in fixed-income securities   
with lower ratings (commonly known as "junk bonds") tend to have a higher 
probability that an issuer will default or fail to meet its payment       
  obligations. These securities may be subject to greater price volatility due
to such factors as specific corporate developments, interest rate         
  sensitivity, negative perceptions of the junk bond market generally and less
secondary market liquidity.                                               

..  INFLATION RISK: This is the risk that the value of assets or income from    
investments will be less in the future as inflation decreases the value of
  money. As inflation increases, the value of the Fund's assets can decline as
can the value of the Fund's distributions. This risk is significantly     
greater if the Fund invests a significant portion of its assets in        
fixed-income securities with longer maturities.                           

..  FOREIGN (NON-U.S.) RISK: Investments in securities of non-U.S. issuers may  
  involve more risk than those of U.S. issuers. These securities may fluctuate
  more widely in price and may be less liquid due to adverse market, economic,
political, regulatory or other factors.                                   

..  EMERGING MARKET RISK: Investments in emerging market countries may have more
  risk because the markets are less developed and less liquid as well as being
  subject to increased economic, political, regulatory or other uncertainties.

..  CURRENCY RISK: Fluctuations in currency exchange rates may negatively affect
the value of the Fund's investments or reduce its returns.                

..  PREPAYMENT RISK: The value of mortgage-related or asset-backed securities   
  may be particularly sensitive to changes in prevailing interest rates. Early
payments of principal on some mortgage-related securities may occur during
periods of falling mortgage interest rates and expose the Fund to a lower 
rate of return upon reinvestment of principal. Early payments associated  
with mortgage-related securities cause these securities to experience     
significantly greater price and yield volatility than is experienced by   
traditional fixed-income securities. During periods of rising interest    
rates, a reduction in prepayments may increase the effective life of      
mortgage-related securities, subjecting them to greater risk of decline in
market value in response to rising interest rates. If the life of a       
mortgage-related security is inaccurately predicted, the Fund may not be  
able to realize the rate of return it expected.                           

..  DERIVATIVES RISK: Investments in derivatives may be illiquid, difficult to  
price, and leveraged so that small changes may produce disproportionate   
losses for the Fund, and may be subject to counterparty risk to a greater 
degree than more traditional investments.                                 

..  MANAGEMENT RISK: The Fund is subject to management risk because it is an    
actively managed investment fund. The Adviser will apply its investment   
  techniques and risk analyses in making investment decisions, but there is no
guarantee that its techniques will produce the intended results.          

As with all investments, you may lose money by investing in the Fund.           

BAR CHART AND PERFORMANCE INFORMATION                                           
The bar chart and performance information provide an indication of the          
historical risk of an investment in the Fund by showing:                        

..  how the Fund's performance changed from year to year over ten years; and    

..  how the Fund's average annual returns for one, five and ten years compare to
those of a broad-based securities market index.                           

You may obtain updated performance information on the Fund's website at         
www.AllianceBernstein.com (click on "Pricing & Performance").                   

The Fund's past performance before and after taxes, of course, does not         
necessarily indicate how it will perform in the future.                         

10                                                                              

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BAR CHART                                                                       
The annual returns in the bar chart are for the Fund's Class A shares and do    
not reflect sales loads. If sales loads were reflected, returns would be less   
than those shown.                                                               

[CHART] 

01     02     03     04     05     06     07      08      09     10     
----   ----   ----   ----   ----   ----   ----   -----   -----   ----     
7.36   7.67   3.69   3.48   1.94   3.97   5.68   -8.26   19.18   9.20     

Calendar Year End (%) 

During the period shown in the bar chart, the Fund's:                           

BEST QUARTER WAS UP 7.86% IN THE 3RD QUARTER, 2009; AND WORST QUARTER WAS DOWN  
-4.57% IN THE 3RD QUARTER, 2008.                                                

PERFORMANCE TABLE                                                               
AVERAGE ANNUAL TOTAL RETURNS                                                    
(For the periods ended December 31, 2010)                                       

                                                        [Enlarge/Download Table]

                                                                            1 YEAR 5 YEARS 10 YEARS
---------------------------------------------------------------------------------------------------
                                                                                                   
Class A*       Return Before Taxes                                          4.61%   4.67%   4.74%  
               ------------------------------------------------------------------------------------
               Return After Taxes on Distributions                          3.21%   3.09%   3.06%  
               ------------------------------------------------------------------------------------
               Return After Taxes on Distributions and Sale of Fund Shares  2.97%   3.04%   3.03%  
---------------------------------------------------------------------------------------------------
Class B        Return Before Taxes                                          5.45%   4.95%   4.80%  
---------------------------------------------------------------------------------------------------
Class C        Return Before Taxes                                          7.46%   4.86%   4.47%  
---------------------------------------------------------------------------------------------------
Advisor Class  Return Before Taxes                                          9.52%   5.89%   5.50%  
---------------------------------------------------------------------------------------------------
Barclays Capital U.S. Aggregate Index                                                              
(reflects no deduction for fees, expenses, or taxes)                        6.54%   5.80%   5.84%  
---------------------------------------------------------------------------------------------------

* After-tax Returns:                                                            

-Are shown for Class A shares only and will vary for Class B, Class C and 
 Advisor Class shares because these Classes have different expense ratios.

-Are an estimate, which is based on the highest historical individual     
federal marginal income tax rates and do not reflect the impact of state
and local taxes; actual after-tax returns depend on an individual       
investor's tax situation and are likely to differ from those shown; and 

-Are not relevant to investors who hold Fund shares through tax-deferred  
arrangements such as 401(k) plans or individual retirement accounts.    

INVESTMENT ADVISER                                                              
AllianceBernstein L.P. is the investment adviser for the Fund.                  

PORTFOLIO MANAGER                                                               
The following table lists the persons responsible for day-to-day management of  
the Fund's portfolio:                                                           

                                                                [Download Table]

EMPLOYEE            LENGTH OF SERVICE  TITLE                                
----------------------------------------------------------------------------
                                                                            
Paul J. DeNoon         Since 2009      Senior Vice President of the Adviser 

Shawn E. Keegan        Since 2005      Vice President of the Adviser        

Alison M. Martier      Since 2005      Senior Vice President of the Adviser 

Douglas J. Peebles     Since 2007      Senior Vice President of the Adviser 

Greg J. Wilensky       Since 2005      Senior Vice President of the Adviser 

ADDITIONAL INFORMATION                                                          
For important information about the purchase and sale of Fund shares, tax       
information and financial intermediary compensation, please turn to ADDITIONAL  
INFORMATION ABOUT PURCHASE AND SALE OF FUND SHARES, TAXES AND FINANCIAL         
INTERMEDIARIES, page 25 in this Prospectus.                                     

                                                                            11

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ALLIANCEBERNSTEIN GLOBAL BOND FUND                                              
--------------------------------------------------------------------------------

INVESTMENT OBJECTIVE                                                            
The Fund's investment objective is to generate current income consistent with   
preservation of capital.                                                        

FEES AND EXPENSES OF THE FUND                                                   
This table describes the fees and expenses that you may pay if you buy and hold 
shares of the Fund. You may qualify for sales charge reductions if you and      
members of your family invest, or agree to invest in the future, at least       
$100,000 in AllianceBernstein Mutual Funds. More information about these and    
other discounts is available from your financial intermediary and in Investing  
in the Funds--Sales Charge Reduction Programs on page 37 of this Prospectus and 
in Purchase of Shares--Sales Charge Reduction Programs on page 108 of the       
Funds' SAI.                                                                     

SHAREHOLDER FEES (fees paid directly from your investment)                      

                                                        [Enlarge/Download Table]

                                                               CLASS B SHARES                            
                                                   CLASS A (NOT CURRENTLY OFFERED CLASS C   ADVISOR CLASS
                                                   SHARES    TO NEW INVESTORS)    SHARES       SHARES    
---------------------------------------------------------------------------------------------------------
                                                                                                         
Maximum Sales Charge (Load) Imposed on Purchases                                                         
(as a percentage of offering price)                 4.25%            None            None       None     
---------------------------------------------------------------------------------------------------------
Maximum Deferred Sales Charge (Load)                                                                     
(as a percentage of offering price or redemption                                                         
proceeds, whichever is lower)                       None           3.00%(a)        1.00%(b)     None     
---------------------------------------------------------------------------------------------------------
Exchange Fee                                        None             None            None       None     

ANNUAL FUND OPERATING EXPENSES (expenses that you pay each year as a percentage 
of the value of your investment)                                                

                                                        [Enlarge/Download Table]

                                                                                       CLASS A CLASS B CLASS C ADVISOR CLASS
----------------------------------------------------------------------------------------------------------------------------
                                                                                                                            
Management Fees                                                                          .50%    .50%    .50%       .50%    
Distribution and/or Service (12b-1) Fees                                                 .30%   1.00%   1.00%       None    
Other Expenses:                                                                                                             
  Transfer Agent                                                                         .10%    .12%    .10%       .10%    
  Interest Expense and Related Expenses                                                  .08%    .08%    .07%       .06%    
  Other Expenses                                                                         .04%    .06%    .06%       .06%    
                                                                                       ------  ------  ------     ------    
Total Other Expenses                                                                     .22%    .26%    .23%       .22%    
                                                                                       ------  ------  ------     ------    
Total Annual Fund Operating Expenses                                                    1.02%   1.76%   1.73%       .72%    
                                                                                       ======  ======  ======     ======    
  Fee Waiver and/or Expense Reimbursement(c)                                           (.04)%  (.08)%  (.06)%     (.06)%    
                                                                                       ------  ------  ------     ------    
Total Annual Fund Operating Expenses After Fee Waiver and/or Expense Reimbursement(d)    .98%   1.68%   1.67%       .66%    
                                                                                       ======  ======  ======     ======    
----------------------------------------------------------------------------------------------------------------------------

(a)Class B shares automatically convert to Class A shares after six years. The  
CDSC decreases over time. For Class B shares, the CDSC decreases 1.00%    
annually to 0% after the third year.                                      

(b)For Class C shares, the CDSC is 0% after the first year.                     

(c)The fee waiver and/or expense reimbursements will remain in effect until     
January 31, 2012 and will continue thereafter from year to year unless the
Adviser provides notice of termination 60 days prior to the end of the    
Fund's fiscal year.                                                       

(d)If interest expenses were excluded, net expenses would be as follows:        

                                                                [Download Table]

CLASS A CLASS B CLASS C ADVISOR CLASS
-------------------------------------
                                     
 .90%    1.60%   1.60%      .60%     

12                                                                              

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EXAMPLES                                                                        
The Examples are intended to help you compare the cost of investing in the Fund 
with the cost of investing in other mutual funds. The Examples assume that you  
invest $10,000 in the Fund for the time periods indicated and then redeem all   
of your shares at the end of those periods. The Examples also assume that your  
investment has a 5% return each year, that the Fund's operating expenses stay   
the same and that the fee waiver is in effect for only the first year. Although 
your actual costs may be higher or lower, based on these assumptions your costs 
would be:                                                                       

                                                                [Download Table]

                CLASS A CLASS B CLASS C ADVISOR CLASS
-----------------------------------------------------
                                                     
After 1 Year    $  521  $  471  $  270      $ 67     
After 3 Years   $  732  $  646  $  539      $224     
After 5 Years   $  961  $  947  $  933      $395     
After 10 Years  $1,617  $1,692  $2,036      $889     
-----------------------------------------------------

You would pay the following expenses if you did not redeem your shares at the   
end of period:                                                                  

                                                                [Download Table]

                CLASS A CLASS B CLASS C ADVISOR CLASS
-----------------------------------------------------
                                                     
After 1 Year    $  521  $  171  $  170      $ 67     
After 3 Years   $  732  $  546  $  539      $224     
After 5 Years   $  961  $  947  $  933      $395     
After 10 Years  $1,617  $1,692  $2,036      $889     
-----------------------------------------------------

PORTFOLIO TURNOVER                                                              
The Fund will pay transaction costs, such as commissions, when it buys or sells 
securities (or "turns over" its portfolio). A higher portfolio turnover may     
indicate higher transaction costs and may result in higher taxes when Fund      
shares are held in a taxable account. These transaction costs, which are not    
reflected in the Annual Fund Operating Expenses or in the Examples, affect the  
Fund's performance. During the most recent fiscal year, the Fund's portfolio    
turnover rate was 69% of the average value of its portfolio.                    

PRINCIPAL STRATEGIES                                                            
The Fund invests, under normal circumstances, at least 80% of its net assets in 
fixed-income securities. Under normal market conditions, the Fund invests       
significantly in fixed-income securities of non-U.S. companies. In addition,    
the Fund invests, under normal circumstances, in the fixed-income securities of 
companies located in at least three countries. The Fund may invest in a broad   
range of fixed-income securities in both developed and emerging markets. The    
Fund may invest across all fixed-income sectors, including U.S. and non-U.S.    
government and corporate debt securities. The Fund's investments may be         
denominated in local currency or U.S. Dollar-denominated. The Fund may invest   
in debt securities with a range of maturities from short- to long-term. The     
Fund may use borrowings or other leverage for investment purposes.              

The Adviser selects securities for purchase or sale based on its assessment of  
the securities' risk and return characteristics as well as the securities'      
impact on the overall risk and return characteristics of the Fund. In making    
this assessment, the Adviser takes into account various factors including the   
credit quality and sensitivity to interest rates of the securities under        
consideration and of the Fund's other holdings.                                 

The Adviser will actively manage the Fund's assets in relation to market        
conditions and general economic conditions and adjust the Fund's investments in 
an effort to best enable the Fund to achieve its investment objective. Thus,    
the percentage of the Fund's assets invested in a particular country or         
denominated in a particular currency will vary in accordance with the Adviser's 
assessment of the relative yield and appreciation potential of such securities  
and the relationship of the country's currency to the U.S. Dollar.              

Under normal circumstances, the Fund invests at least 75% of its net assets in  
fixed-income securities rated investment grade at the time of investment and    
may invest up to 25% of its net assets in below investment grade fixed-income   
securities.                                                                     

The Fund may invest in mortgage-related and other asset-backed securities, loan 
participations, inflation-protected securities, structured securities,          
variable, floating, and inverse floating rate instruments and preferred stock,  
and may use other investment techniques. The Fund intends, among other things,  
to enter into transactions such as reverse repurchase agreements and dollar     
rolls. The Fund may invest, without limit, in derivatives, such as options,     
futures, forwards, or swap agreements.                                          

PRINCIPAL RISKS                                                                 
..  MARKET RISK: The value of the Fund's assets will fluctuate as the stock or  
 bond market fluctuates. The value of its investments may decline, sometimes
rapidly and unpredictably, simply because of economic changes or other    
events that affect large portions of the market.                          

                                                                            13

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..  INTEREST RATE RISK: Changes in interest rates will affect the value of      
 investments in fixed-income securities. When interest rates rise, the value
  of investments in fixed-income securities tends to fall and this decrease in
  value may not be offset by higher income from new investments. Interest rate
  risk is generally greater for fixed-income securities with longer maturities
or durations.                                                             

..  CREDIT RISK: An issuer or guarantor of a fixed-income security, or the      
 counterparty to a derivatives or other contract, may be unable or unwilling
 to make timely payments of interest or principal, or to otherwise honor its
 obligations. The issuer or guarantor may default causing a loss of the full
  principal amount of a security. The degree of risk for a particular security
may be reflected in its credit rating. There is the possibility that the  
credit rating of a fixed-income security may be downgraded after purchase,
which may adversely affect the value of the security.                     

..  BELOW INVESTMENT GRADE SECURITIES: Investments in fixed-income securities   
with lower ratings (commonly known as "junk bonds") tend to have a higher 
probability that an issuer will default or fail to meet its payment       
  obligations. These securities may be subject to greater price volatility due
to such factors as specific corporate developments, interest rate         
  sensitivity, negative perceptions of the junk bond market generally and less
secondary market liquidity.                                               

..  INFLATION RISK: This is the risk that the value of assets or income from    
investments will be less in the future as inflation decreases the value of
  money. As inflation increases, the value of the Fund's assets can decline as
can the value of the Fund's distributions. This risk is significantly     
greater if the Fund invests a significant portion of its assets in        
fixed-income securities with longer maturities.                           

..  FOREIGN (NON-U.S.) RISK: Investments in securities of non-U.S. issuers may  
  involve more risk than those of U.S. issuers. These securities may fluctuate
  more widely in price and may be less liquid due to adverse market, economic,
political, regulatory or other factors.                                   

..  EMERGING MARKET RISK: Investments in emerging market countries may have more
  risk because the markets are less developed and less liquid as well as being
  subject to increased economic, political, regulatory or other uncertainties.

..  CURRENCY RISK: Fluctuations in currency exchange rates may negatively affect
the value of the Fund's investments or reduce its returns.                

..  LEVERAGE RISK: To the extent the Fund uses leveraging techniques, its NAV   
may be more volatile because leverage tends to exaggerate the effect of   
changes in interest rates and any increase or decrease in the value of the
Fund's investments.                                                       

..  DIVERSIFICATION RISK: The Fund may have more risk because it is             
"non-diversified," meaning that it can invest more of its assets in a     
smaller number of issuers and that adverse changes in the value of one    
security could have a more significant effect on the Fund's NAV.          

..  DERIVATIVES RISK: Investments in derivatives may be illiquid, difficult to  
price, and leveraged so that small changes may produce disproportionate   
losses for the Fund, and may be subject to counterparty risk to a greater 
degree than more traditional investments.                                 

..  MANAGEMENT RISK: The Fund is subject to management risk because it is an    
actively managed investment fund. The Adviser will apply its investment   
  techniques and risk analyses in making investment decisions, but there is no
guarantee that its techniques will produce the intended results.          

As with all investments, you may lose money by investing in the Fund.           

BAR CHART AND PERFORMANCE INFORMATION                                           
The bar chart and performance information provide an indication of the          
historical risk of an investment in the Fund by showing:                        

..  how the Fund's performance changed from year to year over ten years; and    

..  how the Fund's average annual returns for one, five and ten years compare to
those of a broad-based securities market index.                           

You may obtain updated performance information on the Fund's website at         
www.AllianceBernstein.com (click on "Pricing & Performance").                   

The Fund's past performance before and after taxes, of course, does not         
necessarily indicate how it will perform in the future.                         

14                                                                              

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BAR CHART                                                                       
The annual returns in the bar chart are for the Fund's Class A shares and do    
not reflect sales loads. If sales loads were reflected, returns would be less   
than those shown.                                                               

[CHART] 

01     02     03     04     05     06     07      08     09     10      
----  -----  -----   ----   ----   ----   ----  ------  -----   ----      
0.31  10.68  15.13   6.87   9.71   6.57   9.90  -10.71  23.96   9.53      

Calendar Year End (%) 

During the period shown in the bar chart, the Fund's:                           

BEST QUARTER WAS UP 11.30% IN THE 2ND QUARTER, 2009; AND WORST QUARTER WAS DOWN 
-5.57% IN THE 4TH QUARTER, 2008.                                                

PERFORMANCE TABLE                                                               
AVERAGE ANNUAL TOTAL RETURNS                                                    
(For the periods ended December 31, 2010)                                       

                                                        [Enlarge/Download Table]

                                                                              1 YEAR 5 YEARS 10 YEARS
-----------------------------------------------------------------------------------------------------
                                                                                                     
Class A*         Return Before Taxes                                           4.90%  6.34%   7.38%  
                 ------------------------------------------------------------------------------------
                 Return After Taxes on Distributions                           3.55%  4.39%   4.85%  
                 ------------------------------------------------------------------------------------
                 Return After Taxes on Distributions and Sale of Fund Shares   3.16%  4.23%   4.74%  
-----------------------------------------------------------------------------------------------------
Class B          Return Before Taxes                                           5.78%  6.53%   7.35%  
-----------------------------------------------------------------------------------------------------
Class C          Return Before Taxes                                           7.73%  6.52%   7.07%  
-----------------------------------------------------------------------------------------------------
Advisor Class**  Return Before Taxes                                           9.71%  7.56%   8.15%  
-----------------------------------------------------------------------------------------------------
Barclays Capital Global Aggregate Index (U.S. hedged)                                                
(reflects no deduction for fees, expenses, or taxes)                          -1.33%  3.50%   4.33%  
-----------------------------------------------------------------------------------------------------

* After-tax Returns:                                                            

-Are shown for Class A shares only and will vary for Class B and Class C  
shares because these Classes have higher expense ratios;                

-Are an estimate, which is based on the highest historical individual     
federal marginal income tax rates and do not reflect the impact of state
and local taxes; actual after-tax returns depend on an individual       
investor's tax situation and are likely to differ from those shown; and 

-Are not relevant to investors who hold Fund shares through tax-deferred  
arrangements such as 401(k) plans or individual retirement accounts.    

**Inception date of Advisor Class shares: 11/05/07. Performance information for 
periods prior to the inception of Advisor Class shares is the performance of
the Fund's Class A shares adjusted to reflect the lower expense ratio of    
Advisor Class shares.                                                       

INVESTMENT ADVISER                                                              
AllianceBernstein L.P. is the investment adviser for the Fund.                  

PORTFOLIO MANAGER                                                               
The following table lists the persons responsible for day-to-day management of  
the Fund's portfolio:                                                           

                                                                [Download Table]

EMPLOYEE             LENGTH OF SERVICE  TITLE                                
-----------------------------------------------------------------------------
                                                                             
Paul J. DeNoon          Since 2002      Senior Vice President of the Adviser 

Scott DiMaggio          Since 2005      Senior Vice President of the Adviser 

Michael L. Mon          Since 2003      Vice President of the Adviser        

Douglas J. Peebles      Since 1992      Senior Vice President of the Adviser 

Matthew S. Sheridan     Since 2007      Vice President of the Adviser        

ADDITIONAL INFORMATION                                                          
For important information about the purchase and sale of Fund shares, tax       
information and financial intermediary compensation, please turn to ADDITIONAL  
INFORMATION ABOUT PURCHASE AND SALE OF FUND SHARES, TAXES AND FINANCIAL         
INTERMEDIARIES, page 25 in this Prospectus.                                     

                                                                            15

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ALLIANCEBERNSTEIN DIVERSIFIED YIELD FUND                                        
--------------------------------------------------------------------------------

INVESTMENT OBJECTIVE                                                            
The Fund's investment objective is to generate current income consistent with   
preservation of capital.                                                        

FEES AND EXPENSES OF THE FUND                                                   
This table describes the fees and expenses that you may pay if you buy and hold 
shares of the Fund. You may qualify for sales charge reductions if you and      
members of your family invest, or agree to invest in the future, at least       
$100,000 in AllianceBernstein Mutual Funds. More information about these and    
other discounts is available from your financial intermediary and in Investing  
in the Funds--Sales Charge Reduction Programs on page 37 of this Prospectus and 
in Purchase of Shares--Sales Charge Reduction Programs on page 108 of the       
Funds' SAI.                                                                     

SHAREHOLDER FEES (fees paid directly from your investment)                      

                                                        [Enlarge/Download Table]

                                                               CLASS B SHARES                            
                                                   CLASS A (NOT CURRENTLY OFFERED CLASS C   ADVISOR CLASS
                                                   SHARES    TO NEW INVESTORS)    SHARES       SHARES    
---------------------------------------------------------------------------------------------------------
                                                                                                         
Maximum Sales Charge (Load) Imposed on Purchases                                                         
(as a percentage of offering price)                 4.25%            None            None       None     
---------------------------------------------------------------------------------------------------------
Maximum Deferred Sales Charge (Load)                                                                     
(as a percentage of offering price or redemption                                                         
proceeds, whichever is lower)                       None           4.00%(a)        1.00%(b)     None     
---------------------------------------------------------------------------------------------------------
Exchange Fee                                        None             None            None       None     

ANNUAL FUND OPERATING EXPENSES (expenses that you pay each year as a percentage 
of the value of your investment)                                                

                                                        [Enlarge/Download Table]

                                                                                    CLASS A CLASS B CLASS C ADVISOR CLASS
-------------------------------------------------------------------------------------------------------------------------
                                                                                                                         
Management Fees                                                                       .50%    .50%    .50%       .50%    
Distribution and/or Service (12b-1) Fees                                              .30%   1.00%   1.00%       None    
Other Expenses:                                                                                                          
  Transfer Agent                                                                      .12%    .17%    .13%       .12%    
  Other Expenses                                                                      .63%    .63%    .63%       .61%    
                                                                                    ------  ------  ------     ------    
Total Other Expenses                                                                  .75%    .80%    .76%       .73%    
                                                                                    ------  ------  ------     ------    
Total Annual Fund Operating Expenses                                                 1.55%   2.30%   2.26%      1.23%    
                                                                                    ======  ======  ======     ======    
  Fee Waiver and/or Expense Reimbursement(c)                                        (.65)%  (.70)%  (.66)%     (.63)%    
                                                                                    ------  ------  ------     ------    
Total Annual Fund Operating Expenses After Fee Waiver and/or Expense Reimbursement    .90%   1.60%   1.60%       .60%    
                                                                                    ======  ======  ======     ======    
-------------------------------------------------------------------------------------------------------------------------

(a)Class B shares automatically convert to Class A shares after eight years.    
The CDSC decreases over time. For Class B shares, the CDSC decreases 1.00%
annually to 0% after the fourth year.                                     

(b)For Class C shares, the CDSC is 0% after the first year.                     

(c)The fee waiver and/or expense reimbursements will remain in effect until     
January 31, 2012 and will continue thereafter from year to year unless the
Adviser provides notice of termination 60 days prior to the end of the    
Fund's fiscal year.                                                       

EXAMPLES                                                                        
The Examples are intended to help you compare the cost of investing in the Fund 
with the cost of investing in other mutual funds. The Examples assume that you  
invest $10,000 in the Fund for the time periods indicated and then redeem all   
of your shares at the end of those periods. The Examples also assume that your  
investment has a 5% return each year, that the Fund's operating expenses stay   
the same and that the fee waiver is in effect for only the first year. Although 
your actual costs may be higher or lower, based on these assumptions your costs 
would be:                                                                       

                                                                [Download Table]

                CLASS A CLASS B CLASS C ADVISOR CLASS
-----------------------------------------------------
                                                     
After 1 Year    $  513  $  563  $  263     $   61    
After 3 Years   $  833  $  851  $  643     $  339    
After 5 Years   $1,175  $1,167  $1,150     $  637    
After 10 Years  $2,139  $2,393  $2,544     $1,485    
-----------------------------------------------------

16                                                                              

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You would pay the following expenses if you did not redeem your shares at the   
end of period:                                                                  

                                                                [Download Table]

                                    CLASS A CLASS B CLASS C ADVISOR CLASS
-------------------------------------------------------------------------
                                                                         
After 1 Year                        $  513  $  163  $  163     $   61    
After 3 Years                       $  833  $  651  $  643     $  339    
After 5 Years                       $1,175  $1,167  $1,150     $  637    
After 10 Years                      $2,139  $2,393  $2,544     $1,485    
-------------------------------------------------------------------------

PORTFOLIO TURNOVER                                                              
The Fund will pay transaction costs, such as commissions, when it buys or sells 
securities (or "turns over" its portfolio). A higher portfolio turnover may     
indicate higher transaction costs and may result in higher taxes when Fund      
shares are held in a taxable account. These transaction costs, which are not    
reflected in the Annual Fund Operating Expenses or in the Examples, affect the  
Fund's performance. During the most recent fiscal year, the Fund's portfolio    
turnover rate was 54% of the average value of its portfolio.                    

PRINCIPAL STRATEGIES                                                            
The Fund employs a dynamic risk allocation, meaning that the Fund's risk        
profile may vary significantly over time based upon market conditions. The Fund 
invests in a portfolio of fixed-income securities of U.S. and non-U.S.          
companies, U.S. and non-U.S. government entities and supranational entities,    
including lower-rated securities. The Fund limits its investments in the        
securities of any one non-U.S. government to 25% of its total assets. The Fund  
may invest in debt securities with a range of maturities from short- to         
long-term.                                                                      

The Adviser selects securities for purchase or sale based on its assessment of  
the securities' risk and return characteristics as well as the securities'      
impact on the overall risk and return characteristics of the Fund. In making    
this assessment, the Adviser takes into account various factors including the   
credit quality and sensitivity to interest rates of the securities under        
consideration and of the Fund's other holdings.                                 

The Fund typically maintains at least 50% of its net assets in investment grade 
securities. The Fund may invest up to 50% of its net assets in below investment 
grade securities, such as corporate high yield fixed-income securities,         
sovereign debt obligations and fixed-income securities of issuers located in    
emerging markets.                                                               

The Fund may also invest in mortgage-related and other asset-backed securities, 
loan participations, inflation-protected securities, structured securities,     
variable, floating, and inverse floating rate instruments and preferred stock,  
and may use other investment techniques. The Fund may make short sales of       
securities or currencies or maintain a short position. The Fund may use         
borrowings or other leverage for investment purposes. The Fund intends, among   
other things, to enter into transactions such as reverse repurchase agreements  
and dollar rolls. The Fund may invest, without limit, in derivatives, such as   
options, futures, forwards, or swap agreements.                                 

PRINCIPAL RISKS                                                                 
..  MARKET RISK: The value of the Fund's assets will fluctuate as the stock or  
 bond market fluctuates. The value of its investments may decline, sometimes
rapidly and unpredictably, simply because of economic changes or other    
events that affect large portions of the market.                          

..  INTEREST RATE RISK: Changes in interest rates will affect the value of      
 investments in fixed-income securities. When interest rates rise, the value
  of investments in fixed-income securities tends to fall and this decrease in
  value may not be offset by higher income from new investments. Interest rate
  risk is generally greater for fixed-income securities with longer maturities
or durations.                                                             

..  CREDIT RISK: An issuer or guarantor of a fixed-income security, or the      
 counterparty to a derivatives or other contract, may be unable or unwilling
 to make timely payments of interest or principal, or to otherwise honor its
 obligations. The issuer or guarantor may default causing a loss of the full
  principal amount of a security. The degree of risk for a particular security
may be reflected in its credit rating. There is the possibility that the  
credit rating of a fixed-income security may be downgraded after purchase,
which may adversely affect the value of the security.                     

..  BELOW INVESTMENT GRADE SECURITIES: Investments in fixed-income securities   
with lower ratings (commonly known as "junk bonds") tend to have a higher 
probability that an issuer will default or fail to meet its payment       
  obligations. These securities may be subject to greater price volatility due
to such factors as specific corporate developments, interest rate         
  sensitivity, negative perceptions of the junk bond market generally and less
secondary market liquidity.                                               

..  INFLATION RISK: This is the risk that the value of assets or income from    
investments will be less in the future as inflation decreases the value of
  money. As inflation increases, the value of the Fund's assets can decline as
can the value of the Fund's distributions. This risk is significantly     
greater if the Fund invests a significant portion of its assets in        
fixed-income securities with longer maturities.                           

                                                                            17

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..  FOREIGN (NON-U.S.) RISK: Investments in securities of non-U.S. issuers may  
  involve more risk than those of U.S. issuers. These securities may fluctuate
  more widely in price and may be less liquid due to adverse market, economic,
political, regulatory or other factors.                                   

..  EMERGING MARKET RISK: Investments in emerging market countries may have more
  risk because the markets are less developed and less liquid as well as being
  subject to increased economic, political, regulatory or other uncertainties.

..  CURRENCY RISK: Fluctuations in currency exchange rates may negatively affect
the value of the Fund's investments or reduce its returns.                

..  LEVERAGE RISK: To the extent the Fund uses leveraging techniques, its NAV   
may be more volatile because leverage tends to exaggerate the effect of   
changes in interest rates and any increase or decrease in the value of the
Fund's investments.                                                       

..  PREPAYMENT RISK: The value of mortgage-related or asset-backed securities   
  may be particularly sensitive to changes in prevailing interest rates. Early
payments of principal on some mortgage-related securities may occur during
periods of falling mortgage interest rates and expose the Fund to a lower 
rate of return upon reinvestment of principal. Early payments associated  
with mortgage-related securities cause these securities to experience     
significantly greater price and yield volatility than is experienced by   
traditional fixed-income securities. During periods of rising interest    
rates, a reduction in prepayments may increase the effective life of      
mortgage-related securities, subjecting them to greater risk of decline in
market value in response to rising interest rates. If the life of a       
mortgage-related security is inaccurately predicted, the Fund may not be  
able to realize the rate of return it expected.                           

..  DERIVATIVES RISK: Investments in derivatives may be illiquid, difficult to  
price, and leveraged so that small changes may produce disproportionate   
losses for the Fund, and may be subject to counterparty risk to a greater 
degree than more traditional investments.                                 

..  MANAGEMENT RISK: The Fund is subject to management risk because it is an    
actively managed investment fund. The Adviser will apply its investment   
  techniques and risk analyses in making investment decisions, but there is no
guarantee that its techniques will produce the intended results.          

As with all investments, you may lose money by investing in the Fund.           

BAR CHART AND PERFORMANCE INFORMATION                                           
The bar chart and performance information provide an indication of the          
historical risk of an investment in the Fund by showing:                        

..  how the Fund's performance changed from year to year over ten years; and    

..  how the Fund's average annual returns for one, five and ten years compare to
those of a broad-based securities market index.                           

You may obtain updated performance information on the Fund's website at         
www.AllianceBernstein.com (click on "Pricing & Performance").                   

The Fund's past performance before and after taxes, of course, does not         
necessarily indicate how it will perform in the future.                         

BAR CHART                                                                       
The annual returns in the bar chart are for the Fund's Class A shares and do    
not reflect sales loads. If sales loads were reflected, returns would be less   
than those shown.                                                               

[CHART] 

01     02     03     04     05     06     07      08     09     10      
-----   ----  -----   ----   ----   ----   ----  ------  -----   ----       
-2.81   5.04  15.61   6.13   4.81   4.46   6.38  -16.52  19.20   7.38       

Calendar Year End (%) 

During the period shown in the bar chart, the Fund's:                           

BEST QUARTER WAS UP 8.57% IN THE 2ND QUARTER, 2009; AND WORST QUARTER WAS DOWN  
-9.62% IN THE 4TH QUARTER, 2008.                                                

18                                                                              

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PERFORMANCE TABLE                                                               
AVERAGE ANNUAL TOTAL RETURNS                                                    
(For the periods ended December 31, 2010)                                       

                                                        [Enlarge/Download Table]

                                                                            1 YEAR 5 YEARS 10 YEARS
---------------------------------------------------------------------------------------------------
                                                                                                   
Class A*       Return Before Taxes                                          2.82%   2.61%   4.09%  
               ------------------------------------------------------------------------------------
               Return After Taxes on Distributions                          1.87%   1.31%   2.26%  
               ------------------------------------------------------------------------------------
               Return After Taxes on Distributions and Sale of Fund Shares  1.82%   1.45%   2.36%  
---------------------------------------------------------------------------------------------------
Class B        Return Before Taxes                                          2.63%   2.78%   4.10%  
---------------------------------------------------------------------------------------------------
Class C        Return Before Taxes                                          5.64%   2.77%   3.80%  
---------------------------------------------------------------------------------------------------
Advisor Class  Return Before Taxes                                          7.83%   3.80%   4.85%  
---------------------------------------------------------------------------------------------------
Barclays Capital Global Aggregate Index (U.S. hedged)                                              
(reflects no deduction for fees, expenses, or taxes)                        4.61%   4.85%   5.20%  
---------------------------------------------------------------------------------------------------
BofA Merrill Lynch 3-Month T-Bill Index                                     0.13%   2.43%   2.38%  
---------------------------------------------------------------------------------------------------

* After-tax Returns:                                                            

-Are shown for Class A shares only and will vary for Class B, Class C and 
 Advisor Class shares because these Classes have different expense ratios.

-Are an estimate, which is based on the highest historical individual     
federal marginal income tax rates and do not reflect the impact of state
and local taxes; actual after-tax returns depend on an individual       
investor's tax situation and are likely to differ from those shown; and 

-Are not relevant to investors who hold Fund shares through tax-deferred  
arrangements such as 401(k) plans or individual retirement accounts.    

INVESTMENT ADVISER                                                              
AllianceBernstein L.P. is the investment adviser for the Fund.                  

PORTFOLIO MANAGER                                                               
The following table lists the persons responsible for day-to-day management of  
the Fund's portfolio:                                                           

                                                                [Download Table]

EMPLOYEE             LENGTH OF SERVICE  TITLE                                
-----------------------------------------------------------------------------
                                                                             
Paul J. DeNoon          Since 2005      Senior Vice President of the Adviser 

Joran Laird             Since 2009      Vice President of the Adviser        

Douglas J. Peebles      Since 1996      Senior Vice President of the Adviser 

Matthew S. Sheridan     Since 2006      Vice President of the Adviser        

Greg J. Wilensky        Since 2008      Senior Vice President of the Adviser 

ADDITIONAL INFORMATION                                                          
For important information about the purchase and sale of Fund shares, tax       
information and financial intermediary compensation, please turn to ADDITIONAL  
INFORMATION ABOUT PURCHASE AND SALE OF FUND SHARES, TAXES AND FINANCIAL         
INTERMEDIARIES, page 25 in this Prospectus.                                     

                                                                            19

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ALLIANCEBERNSTEIN HIGH INCOME FUND                                              
--------------------------------------------------------------------------------

INVESTMENT OBJECTIVE                                                            
The Fund's investment objective is to seek to maximize total returns from price 
appreciation and income.                                                        

FEES AND EXPENSES OF THE FUND                                                   
This table describes the fees and expenses that you may pay if you buy and hold 
shares of the Fund. You may qualify for sales charge reductions if you and      
members of your family invest, or agree to invest in the future, at least       
$100,000 in AllianceBernstein Mutual Funds. More information about these and    
other discounts is available from your financial intermediary and in Investing  
in the Funds--Sales Charge Reduction Programs on page 37 of this Prospectus and 
in Purchase of Shares--Sales Charge Reduction Programs on page 108 of the       
Funds' SAI.                                                                     

SHAREHOLDER FEES (fees paid directly from your investment)                      

                                                        [Enlarge/Download Table]

                                                                                    CLASS B SHARES                              
                                                                       CLASS A (NOT CURRENTLY OFFERED TO CLASS C   ADVISOR CLASS
                                                                       SHARES       NEW INVESTORS)       SHARES       SHARES    
--------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                
Maximum Sales Charge (Load) Imposed on Purchases                                                                                
(as a percentage of offering price)                                     4.25%              None             None       None     
--------------------------------------------------------------------------------------------------------------------------------
Maximum Deferred Sales Charge (Load) (as a percentage of offering                                                               
price or redemption proceeds, whichever is lower)                       None             3.00%(a)         1.00%(b)     None     
--------------------------------------------------------------------------------------------------------------------------------
Exchange Fee                                                            None               None             None       None     

ANNUAL FUND OPERATING EXPENSES (expenses that you pay each year as a percentage 
of the value of your investment)                                                

                                                        [Enlarge/Download Table]

                                                                                       CLASS A CLASS B CLASS C ADVISOR CLASS
----------------------------------------------------------------------------------------------------------------------------
                                                                                                                            
Management Fees                                                                          .50%    .50%    .50%       .50%    
Distribution and/or Service (12b-1) Fees                                                 .30%   1.00%   1.00%       None    
Other Expenses:                                                                                                             
  Transfer Agent                                                                         .12%    .16%    .12%       .12%    
  Interest Expenses and Related Expenses                                                 .04%    .05%    .04%       .03%    
  Other Expenses                                                                         .08%    .07%    .07%       .08%    
                                                                                       ------  ------  ------     ------    
Total Other Expenses                                                                     .24%    .28%    .23%       .23%    
                                                                                       ------  ------  ------     ------    
Total Annual Fund Operating Expenses                                                    1.04%   1.78%   1.73%       .73%    
                                                                                       ======  ======  ======     ======    
  Fee Waiver and/or Expense Reimbursement(c)                                           (.05)%  (.08)%  (.04)%     (.05)%    
                                                                                       ------  ------  ------     ------    
Total Annual Fund Operating Expenses After Fee Waiver and/or Expense Reimbursement(d)    .99%   1.70%   1.69%       .68%    
                                                                                       ======  ======  ======     ======    
----------------------------------------------------------------------------------------------------------------------------

(a)Class B shares automatically convert to Class A shares after six years. The  
CDSC decreases over time. For Class B shares, the CDSC decreases 1.00%    
annually to 0% after the third year.                                      

(b)For Class C shares, the CDSC is 0% after the first year.                     

(c)The fee waiver and/or expense reimbursements will remain in effect until     
January 31, 2012 and will continue thereafter from year-to-year unless the
Adviser provides notice of termination 60 days prior to the end of the    
Fund's fiscal year.                                                       

(d)If interest expenses were excluded, net expenses would be as follows:        

                                                                [Download Table]

CLASS A CLASS B CLASS C ADVISOR CLASS
-------------------------------------
                                     
 .95%    1.65%   1.65%      .65%     

20                                                                              

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EXAMPLES                                                                        
The Examples are intended to help you compare the cost of investing in the Fund 
with the cost of investing in other mutual funds. The Examples assume that you  
invest $10,000 in the Fund for the time periods indicated and then redeem all   
of your shares at the end of those periods. The Examples also assume that your  
investment has a 5% return each year, that the Fund's operating expenses stay   
the same and that the fee waiver is in effect for only the first year. Although 
your actual costs may be higher or lower, based on these assumptions your costs 
would be:                                                                       

                                                                [Download Table]

                CLASS A CLASS B CLASS C ADVISOR CLASS
-----------------------------------------------------
                                                     
After 1 Year    $  522  $  473  $  272      $ 69     
After 3 Years   $  737  $  653  $  541      $228     
After 5 Years   $  970  $  958  $  935      $401     
After 10 Years  $1,638  $1,715  $2,038      $902     
-----------------------------------------------------

You would pay the following expenses if you did not redeem your shares at the   
end of period:                                                                  

                                                                [Download Table]

                CLASS A CLASS B CLASS C ADVISOR CLASS
-----------------------------------------------------
                                                     
After 1 Year    $  522  $  173  $  172      $ 69     
After 3 Years   $  737  $  553  $  541      $228     
After 5 Years   $  970  $  958  $  935      $401     
After 10 Years  $1,638  $1,715  $2,038      $902     
-----------------------------------------------------

PORTFOLIO TURNOVER                                                              
The Fund will pay transaction costs, such as commissions, when it buys or sells 
securities (or "turns over" its portfolio). A higher portfolio turnover may     
indicate higher transaction costs and may result in higher taxes when Fund      
shares are held in a taxable account. These transaction costs, which are not    
reflected in the Annual Fund Operating Expenses or in the Examples, affect the  
Fund's performance. During the most recent fiscal year, the Fund's portfolio    
turnover rate was 26% of the average value of its portfolio.                    

PRINCIPAL STRATEGIES                                                            
The Fund pursues income opportunities from government, corporate, emerging      
market and high yield sources. It has the flexibility to invest in a broad      
range of fixed-income securities in both developed and emerging market          
countries. The Fund's investments may include U.S. and non-U.S. corporate debt  
securities and sovereign debt securities. The Fund may invest, without          
limitation, in either U.S. Dollar-denominated or non-U.S. Dollar-denominated    
fixed-income securities.                                                        

The Adviser selects securities for purchase or sale based on its assessment of  
the securities' risk and return characteristics as well as the securities'      
impact on the overall risk and return characteristics of the Fund. In making    
this assessment, the Adviser takes into account various factors including the   
credit quality and sensitivity to interest rates of the securities under        
consideration and of the Fund's other holdings.                                 

The Fund may invest in debt securities with a range of maturities from short-   
to long-term. Substantially all of the Fund's assets may be invested in         
lower-rated securities, which may include securities having the lowest rating   
for non-subordinated debt instruments (i.e., rated C by Moody's or CCC+ or      
lower by S&P and Fitch) and unrated securities of equivalent investment         
quality. The Fund also may invest in investment grade securities and unrated    
securities.                                                                     

The Fund may also make short sales of securities or maintain a short position.  
The Fund is non-diversified, meaning it may invest more of its assets in a      
fewer number of issuers.                                                        

The Fund may invest in mortgage-related and other asset-backed securities, loan 
participations, inflation-protected securities, structured securities,          
variable, floating, and inverse floating rate instruments and preferred stock,  
and may use other investment techniques. The Fund may use borrowings or other   
leverage for investment purposes. The Fund intends, among other things, to      
enter into transactions such as reverse repurchase agreements and dollar rolls. 
The Fund may invest, without limit, in derivatives, such as options, futures,   
forwards, or swap agreements.                                                   

PRINCIPAL RISKS                                                                 
..  MARKET RISK: The value of the Fund's assets will fluctuate as the stock or  
 bond market fluctuates. The value of its investments may decline, sometimes
rapidly and unpredictably, simply because of economic changes or other    
events that affect large portions of the market.                          

                                                                            21

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..  INTEREST RATE RISK: Changes in interest rates will affect the value of      
 investments in fixed-income securities. When interest rates rise, the value
  of investments in fixed-income securities tends to fall and this decrease in
  value may not be offset by higher income from new investments. Interest rate
  risk is generally greater for fixed-income securities with longer maturities
or durations.                                                             

..  CREDIT RISK: An issuer or guarantor of a fixed-income security, or the      
 counterparty to a derivatives or other contract, may be unable or unwilling
 to make timely payments of interest or principal, or to otherwise honor its
 obligations. The issuer or guarantor may default causing a loss of the full
  principal amount of a security. The degree of risk for a particular security
may be reflected in its credit rating. There is the possibility that the  
credit rating of a fixed-income security may be downgraded after purchase,
which may adversely affect the value of the security.                     

..  BELOW INVESTMENT GRADE SECURITIES: Investments in fixed-income securities   
with lower ratings (commonly known as "junk bonds") tend to have a higher 
probability that an issuer will default or fail to meet its payment       
  obligations. These securities may be subject to greater price volatility due
to such factors as specific corporate developments, interest rate         
  sensitivity, negative perceptions of the junk bond market generally and less
secondary market liquidity.                                               

..  INFLATION RISK: This is the risk that the value of assets or income from    
investments will be less in the future as inflation decreases the value of
  money. As inflation increases, the value of the Fund's assets can decline as
can the value of the Fund's distributions. This risk is significantly     
greater if the Fund invests a significant portion of its assets in        
fixed-income securities with longer maturities.                           

..  FOREIGN (NON-U.S.) RISK: Investments in securities of non-U.S. issuers may  
  involve more risk than those of U.S. issuers. These securities may fluctuate
  more widely in price and may be less liquid due to adverse market, economic,
political, regulatory or other factors.                                   

..  EMERGING MARKET RISK: Investments in emerging market countries may have more
  risk because the markets are less developed and less liquid as well as being
  subject to increased economic, political, regulatory or other uncertainties.

..  CURRENCY RISK: Fluctuations in currency exchange rates may negatively affect
the value of the Fund's investments or reduce its returns.                

..  LEVERAGE RISK: To the extent the Fund uses leveraging techniques, its NAV   
may be more volatile because leverage tends to exaggerate the effect of   
changes in interest rates and any increase or decrease in the value of the
Fund's investments.                                                       

..  DIVERSIFICATION RISK: The Fund may have more risk because it is             
"non-diversified," meaning that it can invest more of its assets in a     
smaller number of issuers and that adverse changes in the value of one    
security could have a more significant effect on the Fund's NAV.          

..  DERIVATIVES RISK: Investments in derivatives may be illiquid, difficult to  
price, and leveraged so that small changes may produce disproportionate   
losses for the Fund, and may be subject to counterparty risk to a greater 
degree than more traditional investments.                                 

..  MANAGEMENT RISK: The Fund is subject to management risk because it is an    
actively managed investment fund. The Adviser will apply its investment   
  techniques and risk analyses in making investment decisions, but there is no
guarantee that its techniques will produce the intended results.          

As with all investments, you may lose money by investing in the Fund.           

22                                                                              

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BAR CHART                                                                       
The annual returns in the bar chart are for the Fund's Class A shares and do    
not reflect sales loads. If sales loads were reflected, returns would be less   
than those shown.                                                               

[CHART] 

01     02     03     04     05     06     07      08     09     10      
----  -----  -----  -----  -----  -----   ----  ------  -----  -----      
6.10  18.70  38.42  11.09  10.16  11.85   7.29  -26.52  61.74  16.80      

Calendar Year End (%) 

During the period shown in the bar chart, the Fund's:                           

BEST QUARTER WAS UP 23.96% IN THE 2ND QUARTER, 2009; AND WORST QUARTER WAS DOWN 
-17.75% IN THE 4TH QUARTER, 2008.                                               

PERFORMANCE TABLE                                                               
AVERAGE ANNUAL TOTAL RETURNS                                                    
(For the periods ended December 31, 2010)                                       

                                                        [Enlarge/Download Table]

                                                                                        1 YEAR 5 YEARS 10 YEARS
---------------------------------------------------------------------------------------------------------------
                                                                                                               
Class A*               Return Before Taxes                                              11.89%  9.78%   13.02% 
                       ----------------------------------------------------------------------------------------
                       Return After Taxes on Distributions                               8.73%  6.43%    9.36% 
                       ----------------------------------------------------------------------------------------
                       Return After Taxes on Distributions and Sale of Fund Shares       7.59%  6.35%    9.03% 
---------------------------------------------------------------------------------------------------------------
Class B                Return Before Taxes                                              12.88%  9.88%   12.98% 
---------------------------------------------------------------------------------------------------------------
Class C                Return Before Taxes                                              14.91%  9.88%   12.61% 
---------------------------------------------------------------------------------------------------------------
Advisor Class**        Return Before Taxes                                              17.18% 11.10%   13.87% 
---------------------------------------------------------------------------------------------------------------
JPMorgan Emerging Markets Bond Index Global ("EMBI Global") (U.S. Dollar-denominated)                          
(reflects no deduction for fees, expenses, or taxes)                                    12.04%  8.36%   10.29% 
---------------------------------------------------------------------------------------------------------------
JPMorgan Government Bond Index-Emerging Markets ("GBI-EM") (local currency-denominated)                        
(reflects no deduction for fees, expenses, or taxes)                                    13.08%  9.82%      N/A 
---------------------------------------------------------------------------------------------------------------
Barclays Capital High Yield Index (2% Constrained) ("BC High Yield")                                           
(reflects no deduction for fees, expenses, or taxes)                                    14.94%  8.91%    9.01% 
---------------------------------------------------------------------------------------------------------------
Composite Benchmark (equal weighted blend of EMBI Global, GBI-EM and BC High Yield)     13.43%  9.19%      N/A 
---------------------------------------------------------------------------------------------------------------

*  After-tax Returns:                                                           

-Are shown for Class A shares only and will vary for Class B and Class C  
shares because these Classes have higher expense ratios;                

-Are an estimate, which is based on the highest historical individual     
federal marginal income tax rates and do not reflect the impact of state
and local taxes; actual after-tax returns depend on an individual       
investor's tax situation and are likely to differ from those shown; and 

-Are not relevant to investors who hold Fund shares through tax-deferred  
arrangements such as 401(k) plans or individual retirement accounts.    

** Inception date for Advisor Class shares: 1/28/08. Performance information    
for periods prior to the inception of Advisor Class shares is the         
performance of the Fund's Class A shares adjusted to reflect the lower    
expense ratio of Advisor Class shares.                                    

                                                                            23

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INVESTMENT ADVISER                                                              
AllianceBernstein L.P. is the investment adviser for the Fund.                  

PORTFOLIO MANAGER                                                               
The following table lists the persons responsible for day-to-day management of  
the Fund's portfolio:                                                           

                                                                [Download Table]

EMPLOYEE               LENGTH OF SERVICE  TITLE                                
-------------------------------------------------------------------------------
                                                                               
Paul J. DeNoon            Since 2002      Senior Vice President of the Adviser 

Gershon M. Distenfeld     Since 2008      Senior Vice President of the Adviser 

Douglas J. Peebles        Since 2002      Senior Vice President of the Adviser 

Marco Santamaria          Since 2010      Vice President of the Adviser        

Matthew S. Sheridan       Since 2005      Vice President of the Adviser        

ADDITIONAL INFORMATION                                                          
For important information about the purchase and sale of Fund shares, tax       
information and financial intermediary compensation, please turn to ADDITIONAL  
INFORMATION ABOUT PURCHASE AND SALE OF FUND SHARES, TAXES AND FINANCIAL         
INTERMEDIARIES, page 25 in this Prospectus.                                     

24                                                                              

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ADDITIONAL INFORMATION ABOUT PURCHASE AND SALE OF FUND SHARES, TAXES AND        
FINANCIAL INTERMEDIARIES                                                        

.   PURCHASE AND SALE OF FUND SHARES                                  

PURCHASE MINIMUMS                                                               

                                                        [Enlarge/Download Table]

                                                                     INITIAL             SUBSEQUENT            
---------------------------------------------------------------------------------------------------------------
                                                                                                               
Class A/Class C Shares, including traditional IRAs and Roth          $2,500                 $50                
IRAs (Class B shares are not currently offered to new shareholders)                                            
---------------------------------------------------------------------------------------------------------------
Automatic Investment Program                                          None                  $50                
                                                                              If initial minimum investment is 
                                                                                less than $2,500, then $200    
                                                                               monthly until account balance   
                                                                                       reaches $2,500          
---------------------------------------------------------------------------------------------------------------
Advisor Class Shares (only available to fee-based programs or         None                  None               
through other limited arrangements)                                                                            
---------------------------------------------------------------------------------------------------------------

You may sell (redeem) your shares each day the New York Stock Exchange is open. 
You may sell your shares through your financial intermediary or by mail         
(AllianceBernstein Investor Services, Inc., P.O. Box 786003, San Antonio, TX    
78278-6003) or telephone (800-221-5672).                                        

.   TAX INFORMATION                                                   

Each Fund may make income dividends or capital gains distributions, which may   
be subject to federal income taxes and taxable as ordinary income or capital    
gains, and may also be subject to state and local taxes.                        

.   PAYMENTS TO BROKER-DEALERS AND OTHER FINANCIAL INTERMEDIARIES     

If you purchase shares of a Fund through a broker-dealer or other financial     
intermediary (such as a bank), the Fund and its related companies may pay the   
intermediary for the sale of Fund shares and related services. These payments   
may create a conflict of interest by influencing the broker-dealer or other     
financial intermediary and your salesperson to recommend the Fund over another  
investment. Ask your salesperson or visit your financial intermediary's website 
for more information.                                                           

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ADDITIONAL INFORMATION ABOUT THE FUNDS' RISKS AND INVESTMENTS                   
--------------------------------------------------------------------------------

This section of the Prospectus provides additional information about the Funds' 
investment practices and related risks. Most of these investment practices are  
discretionary, which means that the Adviser may or may not decide to use them.  
This Prospectus does not describe all of a Fund's investment practices and      
additional information about each Fund's risks and investments can be found in  
the Funds' SAIs.                                                                

DERIVATIVES                                                                     
Each Fund may, but is not required to, use derivatives for risk management      
purposes or as part of its investment strategies. Derivatives are financial     
contracts whose value depends on, or is derived from, the value of an           
underlying asset, reference rate or index. A Fund may use derivatives to earn   
income and enhance returns, to hedge or adjust the risk profile of its          
portfolio, to replace more traditional direct investments and to obtain         
exposure to otherwise inaccessible markets.                                     

There are four principal types of derivatives, including options, futures,      
forwards and swaps, which are described below. Derivatives may be               
(i) standardized, exchange-traded contracts or (ii) customized, privately       
negotiated contracts. Exchange-traded derivatives tend to be more liquid and    
subject to less credit risk than those that are privately negotiated.           

A Fund's use of derivatives may involve risks that are different from, or       
possibly greater than, the risks associated with investing directly in          
securities or other more traditional instruments. These risks include the risk  
that the value of a derivative instrument may not correlate perfectly, or at    
all, with the value of the assets, reference rates, or indices that they are    
designed to track. Other risks include: the possible absence of a liquid        
secondary market for a particular instrument and possible exchange-imposed      
price fluctuation limits, either of which may make it difficult or impossible   
to close out a position when desired; and the risk that the counterparty will   
not perform its obligations. Certain derivatives may have a leverage component  
and involve leverage risk. Adverse changes in the value or level of the         
underlying asset, note or index can result in a loss substantially greater than 
the Fund's investment (in some cases, the potential loss is unlimited).         

The Funds' investments in derivatives may include, but are not limited to, the  
following:                                                                      

..  FORWARD CONTRACTS--A forward contract is an agreement that obligates one    
party to buy, and the other party to sell, a specific quantity of an      
underlying commodity or other tangible asset for an agreed upon price at a
future date. A forward contract is either settled by physical delivery of 
  the commodity or tangible asset to an agreed-upon location at a future date,
rolled forward into a new forward contract or, in the case of a           
non-deliverable forward, by a cash payment at maturity. The Funds'        
investments in forward contracts may include the following:               

- Forward Currency Exchange Contracts. A Fund may purchase or sell forward    
currency exchange contracts for hedging purposes to minimize the risk from
adverse changes in the relationship between the U.S. Dollar and other     
currencies or for non-hedging purposes as a means of making direct        
investments in foreign currencies as described below under "Other         
  Derivatives and Strategies--Currency Transactions." A Fund, for example, may
enter into a forward contract as a transaction hedge (to "lock in" the    
U.S. Dollar price of a non-U.S. Dollar security), as a position hedge (to 
protect the value of securities the Fund owns that are denominated in a   
foreign currency against substantial changes in the value of the foreign  
currency) or as a cross-hedge (to protect the value of securities the Fund
 owns that are denominated in a foreign currency against substantial changes
in the value of that foreign currency by entering into a forward contract 
for a different foreign currency that is expected to change in the same   
direction as the currency in which the securities are denominated).       

..  FUTURES CONTRACTS AND OPTIONS ON FUTURES CONTRACTS--A futures contract is an
  agreement that obligates the buyer to buy and the seller to sell a specified
 quantity of an underlying asset (or settle for cash the value of a contract
based on an underlying asset, rate or index) at a specific price on the   
contract maturity date. Options on futures contracts are options that call
 for the delivery of futures contracts upon exercise. A Fund may purchase or
sell futures contracts and options thereon to hedge against changes in    
  interest rates, securities (through index futures or options) or currencies.
  A Fund may also purchase or sell futures contracts for foreign currencies or
options thereon for non-hedging purposes as a means of making direct      
investments in foreign currencies, as described below under "Other        
Derivatives and Strategies--Currency Transactions."                       

..  OPTIONS--An option is an agreement that, for a premium payment or fee, gives
the option holder (the buyer) the right but not the obligation to buy (a  
 "call option") or sell (a "put option") the underlying asset (or settle for
cash an amount based on an underlying asset, rate or index) at a specified
price (the exercise price) during a period of time or on a specified date.
Investments in options are considered speculative. A Fund may lose the    
  premium paid for them if the price of the underlying security or other asset
decreased or remained the same (in the case of a call option) or increased
 or remained the same (in the case of a put option). If a put or call option
purchased by a Fund were permitted to expire without being sold or        
exercised, its premium would represent a loss to the Fund. The Funds'     
investments in options include the following:                             

- Options on Foreign Currencies. A Fund may invest in options on foreign      
currencies that are privately negotiated or traded on U.S. or foreign     
exchanges for hedging purposes to protect against declines in the         
 U.S. Dollar value of foreign currency denominated securities held by a Fund

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 and against increases in the U.S. Dollar cost of securities to be acquired.
 The purchase of an option on a foreign currency may constitute an effective
hedge against fluctuations in exchange rates, although if rates move      
 adversely, a Fund may forfeit the entire amount of the premium plus related
transaction costs. A Fund may also invest in options on foreign currencies
 for non-hedging purposes as a means of making direct investments in foreign
currencies, as described below under "Other Derivatives and               
Strategies--Currency Transactions."                                       

- Options on Securities. A Fund may purchase or write a put or call option on 
 securities. A Fund may write covered options, which means writing an option
for securities the Fund owns, and uncovered options.                      

- Options on Securities Indices. An option on a securities index is similar to
an option on a security except that, rather than taking or making delivery
of a security at a specified price, an option on a securities index gives 
the holder the right to receive, upon exercise of the option, an amount of
cash if the closing level of the chosen index is greater than (in the case
of a call) or less than (in the case of a put) the exercise price of the  
option.                                                                   

..  SWAP TRANSACTIONS--A swap is an agreement that obligates two parties to     
  exchange a series of cash flows at specified intervals (payment dates) based
upon or calculated by reference to changes in specified prices or rates   
 (interest rates in the case of interest rate swaps, currency exchange rates
  in the case of currency swaps) for a specified amount of an underlying asset
(the "notional" principal amount). Except for currency swaps, the notional
 principal amount is used solely to calculate the payment stream, but is not
exchanged. Swaps are entered into on a net basis (i.e., the two payment   
  streams are netted out, with a Fund receiving or paying, as the case may be,
only the net amount of the two payments). The Funds' investments in swap  
transactions include the following:                                       

- Interest Rate Swaps, Swaptions, Caps and Floors. Interest rate swaps involve
the exchange by a Fund with another party of payments calculated by       
reference to specified interest rates (e.g., an exchange of floating rate 
payments for fixed rate payments). Unless there is a counterparty default,
  the risk of loss to the Fund from interest rate swap transactions is limited
to the net amount of interest payments that the Fund is contractually     
 obligated to make. If the counterparty to an interest rate swap transaction
defaults, the Fund's risk of loss consists of the net amount of interest  
payments that the Fund contractually is entitled to receive.              

An option on a swap agreement, also called a "swaption," is an option that
  gives the buyer the right, but not the obligation, to enter into a swap on a
future date in exchange for paying a market-based "premium." A receiver   
swaption gives the owner the right to receive the total return of a       
 specified asset, reference rate, or index. A payer swaption gives the owner
the right to pay the total return of a specified asset, reference rate, or
index. Swaptions also include options that allow an existing swap to be   
terminated or extended by one of the counterparties.                      

The purchase of an interest rate cap entitles the purchaser, to the extent
that a specified index exceeds a predetermined interest rate, to receive  
payments of interest on a contractually-based principal amount from the   
 party selling the interest rate cap. The purchase of an interest rate floor
entitles the purchaser, to the extent that a specified index falls below a
predetermined interest rate, to receive payments of interest on an agreed 
principal amount from the party selling the interest rate floor. Caps and 
floors may be less liquid than swaps.                                     

There is no limit on the amount of interest rate transactions that may be 
  entered into by a Fund. The value of these transactions will fluctuate based
on changes in interest rates.                                             

Interest rate swap, swaption, cap and floor transactions may be used to   
preserve a return or spread on a particular investment or a portion of a  
Fund's portfolio or to protect against an increase in the price of        
securities a Fund anticipates purchasing at a later date.                 

- Inflation (CPI) Swaps. Inflation swap agreements are contracts in which one 
  party agrees to pay the cumulative percentage increase in a price index (the
Consumer Price Index with respect to CPI swaps) over the term of the swap 
(with some lag on the inflation index), and the other pays a compounded   
fixed rate. Inflation swap agreements may be used to protect the NAV of a 
Fund against an unexpected change in the rate of inflation measured by an 
 inflation index since the value of these agreements is expected to increase
if unexpected inflation increases.                                        

- Credit Default Swap Agreements. The "buyer" in a credit default swap        
  contract is obligated to pay the "seller" a periodic stream of payments over
the term of the contract in return for a contingent payment upon the      
occurrence of a credit event with respect to an underlying reference      
obligation. Generally, a credit event means bankruptcy, failure to pay,   
 obligation acceleration or modified restructuring. A Fund may be either the
  buyer or seller in the transaction. If a Fund is a seller, the Fund receives
 a fixed rate of income throughout the term of the contract, which typically
is between one month and five years, provided that no credit event occurs.
If a credit event occurs, a Fund typically must pay the contingent payment
to the buyer, which is typically the "par value" (full notional value) of 
  the reference obligation. The contingent payment may be a cash settlement or
by physical delivery of the reference obligation in return for payment of 
the face amount of the obligation. The value of the reference obligation  
received by a Fund coupled with the periodic payments previously received 
 may be less than the full notional value it pays to the buyer, resulting in
a loss of value to the Fund. If the reference obligation is a defaulted   
security, physical delivery of the security will cause                    

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a Fund to hold a defaulted security. If a Fund is a buyer and no credit   
event occurs, the Fund will lose its periodic stream of payments over the 
  term of the contract. However, if a credit event occurs, the buyer typically
  receives full notional value for a reference obligation that may have little
or no value.                                                              

Credit default swaps may involve greater risks than if a Fund had invested
in the reference obligation directly. Credit default swaps are subject to 
general market risk, liquidity risk and credit risk.                      

- Currency Swaps. A Fund may invest in currency swaps for hedging purposes to 
protect against adverse changes in exchange rates between the U.S. Dollar 
  and other currencies or for non-hedging purposes as a means of making direct
investments in foreign currencies, as described below under "Other        
Derivatives and Strategies--Currency Transactions." Currency swaps involve
the individually negotiated exchange by a Fund with another party of a    
series of payments in specified currencies. Actual principal amounts of   
currencies may be exchanged by the counterparties at the initiation, and  
again upon the termination, of the transaction. Therefore, the entire     
principal value of a currency swap is subject to the risk that the swap   
 counterparty will default on its contractual delivery obligations. If there
is a default by the counterparty to the transaction, the Fund will have   
contractual remedies under the transaction agreements.                    

- Total Return Swaps. A Fund may enter into total return swaps, under which   
one party agrees to pay the other the total return of a defined underlying
asset, such as a security or basket of securities, or non-asset reference,
such as a securities index, during the specified period in return for     
periodic payments based on a fixed or variable interest rate or the total 
return from different underlying assets or references. Total return swaps 
  could result in losses if the underlying asset or reference does not perform
as anticipated.                                                           

..  OTHER DERIVATIVES AND STRATEGIES--                                          

- Eurodollar Instruments. Eurodollar instruments are essentially              
 U.S. Dollar-denominated futures contracts or options that are linked to the
London Interbank Offered Rate (LIBOR). Eurodollar futures contracts enable
purchasers to obtain a fixed rate for the lending of funds and sellers to 
obtain a fixed rate for borrowings.                                       

- Structured Instruments. As part of its investment program and to maintain   
  greater flexibility, a Fund may invest in structured instruments. Structured
instruments, including indexed or structured securities, combine the      
elements of futures contracts or options with those of debt, preferred    
equity or a depositary instrument. Generally, a structured instrument will
be a debt security, preferred stock, depositary share, trust certificate, 
 certificate of deposit or other evidence of indebtedness on which a portion
of or all interest payments, and/or the principal or stated amount payable
  at maturity, redemption or retirement, is determined by reference to prices,
  changes in prices, or differences between prices, of securities, currencies,
intangibles, goods, articles or commodities (collectively "Underlying     
Assets") or by another objective index, economic factor or other measure, 
such as interest rates, currency exchange rates, commodity indices, and   
securities indices (collectively, "Benchmarks"). Thus, structured         
  instruments may take a variety of forms, including, but not limited to, debt
instruments with interest or principal payments or redemption terms       
determined by reference to the value of a currency or commodity or        
securities index at a future point in time, preferred stock with dividend 
rates determined by reference to the value of a currency, or convertible  
securities with the conversion terms related to a particular commodity.   

Structured instruments are potentially more volatile and carry greater    
market risks than traditional debt instruments. Depending on the structure
of the particular structured instrument, changes in a Benchmark may be    
magnified by the terms of the structured instrument and have an even more 
  dramatic and substantial effect upon the value of the structured instrument.
Also, the prices of the structured instrument and the Benchmark or        
Underlying Asset may not move in the same direction or at the same time.  

Structured instruments can have volatile prices and limited liquidity, and
  their use by a Fund may not be successful. The risk of these investments can
be substantial; possibly all of the principal is at risk.                 

- Currency Transactions. A Fund may invest in non-U.S. Dollar-denominated     
  securities on a currency hedged or un-hedged basis. The Adviser may actively
 manage a Fund's currency exposures and may seek investment opportunities by
taking long or short positions in currencies through the use of           
  currency-related derivatives, including forward currency exchange contracts,
futures and options on futures, swaps and options. The Adviser may enter  
into transactions for investment opportunities when it anticipates that a 
foreign currency will appreciate or depreciate in value but securities    
denominated in that currency are not held by a Fund and do not present    
  attractive investment opportunities. Such transactions may also be used when
 the Adviser believes that it may be more efficient than a direct investment
  in a foreign currency-denominated security. A Fund may also conduct currency
exchange contracts on a spot basis (i.e., for cash at the spot rate       
   prevailing in the currency exchange market for buying or selling currencies).

FORWARD COMMITMENTS                                                             
Forward commitments for the purchase or sale of securities may include          
purchases on a when-issued basis or purchases or sales on a delayed delivery    
basis. In some cases, a forward commitment may be conditioned upon the          
occurrence of a subsequent event, such as approval and consummation of a        

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merger, corporate reorganization or debt restructuring or approval of a         
proposed financing by appropriate authorities (i.e., a "when, as and if issued" 
trade).                                                                         

A Fund may invest significantly in TBA-mortgage-backed securities. A TBA or "To 
Be Announced" trade represents a contract for the purchase or sale of           
mortgage-backed securities to be delivered at a future agreed-upon date;        
however, the specific mortgage pool numbers or the number of pools that will be 
delivered to fulfill the trade obligation or terms of the contract are unknown  
at the time of the trade. Mortgage pools (including fixed rate or variable rate 
mortgages) guaranteed by the Government National Mortgage Association, or GNMA, 
the Federal National Mortgage Association, or FNMA, or the Federal Home Loan    
Mortgage Corporation, or FHLMC, are subsequently allocated to the TBA           
transactions.                                                                   

When forward commitments with respect to fixed-income securities are            
negotiated, the price, which is generally expressed in yield terms, is fixed at 
the time the commitment is made, but payment for and delivery of the securities 
take place at a later date. Securities purchased or sold under a forward        
commitment are subject to market fluctuation and no interest or dividends       
accrue to the purchaser prior to the settlement date. There is the risk of loss 
if the value of either a purchased security declines before the settlement date 
or the security sold increases before the settlement date. The use of forward   
commitments helps a Fund to protect against anticipated changes in interest     
rates and prices.                                                               

ILLIQUID SECURITIES                                                             
Under current Securities and Exchange Commission ("Commission") guidelines, the 
Funds limit their investments in illiquid securities to 15% of their net        
assets. The term "illiquid securities" for this purpose means securities that   
cannot be disposed of within seven days in the ordinary course of business at   
approximately the amount a Fund has valued the securities. A Fund that invests  
in illiquid securities may not be able to sell such securities and may not be   
able to realize their full value upon sale. Restricted securities (securities   
subject to legal or contractual restrictions on resale) may be illiquid. Some   
restricted securities (such as securities issued pursuant to Rule 144A under    
the Securities Act of 1933 (the "Securities Act") or certain commercial paper)  
may be treated as liquid, although they may be less liquid than registered      
securities traded on established secondary markets.                             

INFLATION-PROTECTED SECURITIES                                                  
Inflation-protected securities, or IPS, are fixed-income securities whose       
principal value is periodically adjusted according to the rate of inflation. If 
the index measuring inflation falls, the principal value of these securities    
will be adjusted downward, and consequently the interest payable on these       
securities (calculated with respect to a smaller principal amount) will be      
reduced.                                                                        

The value of inflation-protected securities tends to react to changes in real   
interest rates. In general, the price of an inflation-protected security can    
fall when real interest rates rise, and can rise when real interest rates fall. 
In addition, the value of inflation-protected securities can fluctuate based on 
fluctuations in expectations of inflation. Interest payments on                 
inflation-protected securities can be unpredictable and will vary as the        
principal and/or interest is adjusted for inflation.                            

INVESTMENT IN OTHER INVESTMENT COMPANIES                                        
The Funds (except for AllianceBernstein Short Duration Portfolio) may invest in 
other investment companies as permitted by the Investment Company Act of 1940   
(the "1940 Act") or the rules and regulations thereunder. The Funds intend to   
invest uninvested cash balances in an affiliated money market fund as permitted 
by Rule 12d1-1 under the 1940 Act. If a Fund acquires shares in investment      
companies, shareholders would bear, indirectly, the expenses of such investment 
companies (which may include management and advisory fees), which are in        
addition to the Fund's expenses. A Fund may also invest in exchange-traded      
funds, subject to the restrictions and limitations of the 1940 Act or any       
applicable rules, exemptive orders or regulatory guidance.                      

LOAN PARTICIPATIONS                                                             
A Fund may invest in corporate loans either by participating as co-lender at    
the time the loan is originated or by buying an interest in the loan in the     
secondary market from a financial institution or institutional investor. The    
financial status of an institution interposed between a Fund and a borrower may 
affect the ability of the Fund to receive principal and interest payments.      

The success of a Fund may depend on the skill with which an agent bank          
administers the terms of the corporate loan agreements, monitors borrower       
compliance with covenants, collects principal, interest and fee payments from   
borrowers and, where necessary, enforces creditor remedies against borrowers.   
Agent banks typically have broad discretion in enforcing loan agreements.       

MORTGAGE-RELATED AND OTHER ASSET-BACKED SECURITIES                              
A Fund may invest in mortgage-related or other asset-backed securities.         
Mortgage-related securities include mortgage pass-through securities,           
collateralized mortgage obligations ("CMOs"), commercial mortgage-backed        
securities, mortgage dollar rolls, CMO residuals, stripped mortgage-backed      
securities ("SMBSs") and other securities that directly or indirectly represent 
a participation in or are secured by and payable from mortgage loans on real    
property. These securities may be issued or guaranteed by the U.S. Government   
or one of its sponsored entities or may be issued by private organizations.     

The value of mortgage-related or asset-backed securities may be particularly    
sensitive to changes in prevailing interest rates. Early payments of principal  
on some mortgage-related securities may occur during periods of falling         
mortgage interest rates and expose a Fund to a lower rate of return upon        
reinvestment of principal. Early payments associated with mortgage-related      
securities cause these securities to experience significantly greater price and 
yield volatility than is experienced by traditional fixed-income securities.    
During periods of rising interest rates, a reduction in prepayments may         
increase the effective life of mortgage-related securities, subjecting them     

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to greater risk of decline in market value in response to rising interest       
rates. If the life of a mortgage-related security is inaccurately predicted, a  
Fund may not be able to realize the rate of return it expected.                 

One type of SMBS has one class receiving all of the interest from the mortgage  
assets (the interest-only, or "IO" class), while the other class will receive   
all of the principal (the principal-only, or "PO" class). The yield to maturity 
on an IO class is extremely sensitive to the rate of principal payments         
(including prepayments) on the underlying mortgage assets, and a rapid rate of  
principal payments may have a material adverse effect on a Fund's yield to      
maturity from these securities.                                                 

A Fund may invest in collateralized debt obligations ("CDOs"), which include    
collateralized bond obligations ("CBOs"), collateralized loan obligations       
("CLOs"), and other similarly structured securities. CBOs and CLOs are types of 
asset-backed securities. A CBO is a trust that is backed by a diversified pool  
of high-risk, below investment grade fixed-income securities. A CLO is a trust  
typically collateralized by a pool of loans, which may include, among others,   
domestic and foreign senior secured loans, senior unsecured loans, and          
subordinate corporate loans, including loans that may be rated below investment 
grade or equivalent unrated loans. The Funds may invest in other asset-backed   
securities that have been offered to investors.                                 

A Fund may invest in other asset-backed securities. The securitization          
techniques used to develop mortgage-related securities are being applied to a   
broad range of financial assets. Through the use of trusts and special purpose  
corporations, various types of assets, including automobile loans and leases,   
credit card receivables, home equity loans, equipment leases and trade          
receivables, are being securitized in structures similar to the structures used 
in mortgage securitizations.                                                    

PREFERRED STOCK                                                                 
A Fund may invest in preferred stock. Preferred stock is subordinated to any    
debt the issuer has outstanding. Accordingly, preferred stock dividends are not 
paid until all debt obligations are first met. Preferred stock may be subject   
to more fluctuations in market value, due to changes in market participants'    
perceptions of the issuer's ability to continue to pay dividends, than debt of  
the issuer. These investments include convertible preferred stock, which        
includes an option for the holder to convert the preferred stock into the       
issuer's common stock under certain conditions, among which may be the          
specification of a future date when the conversion may begin, a certain number  
of common shares per preferred shares, or a certain price per share for the     
common stock. Convertible preferred stock tends to be more volatile than        
non-convertible preferred stock, because its value is related to the price of   
the issuer's common stock as well as the dividends payable on the preferred     
stock.                                                                          

REPURCHASE AGREEMENTS AND BUY/SELL BACK TRANSACTIONS                            
A Fund may enter into repurchase agreements in which a Fund purchases a         
security from a bank or broker-dealer, which agrees to repurchase the security  
from the Fund at an agreed- upon future date, normally a day or a few days      
later. The purchase and repurchase transactions are transacted under one        
agreement. The resale price is greater than the purchase price, reflecting an   
agreed-upon interest rate for the period the buyer's money is invested in the   
security. Such agreements permit a Fund to keep all of its assets at work while 
retaining "overnight" flexibility in pursuit of investments of a longer-term    
nature. If the bank or broker-dealer defaults on its repurchase obligation, a   
Fund would suffer a loss to the extent that the proceeds from the sale of the   
security were less than the repurchase price.                                   

A Fund may enter into buy/sell back transactions, which are similar to          
repurchase agreements. In this type of transaction, a Fund enters a trade to    
buy securities at one price and simultaneously enters a trade to sell the same  
securities at another price on a specified date. Similar to a repurchase        
agreement, the repurchase price is higher than the sale price and reflects      
current interest rates. Unlike a repurchase agreement, however, the buy/sell    
back transaction is considered two separate transactions.                       

REVERSE REPURCHASE AGREEMENTS, DOLLAR ROLLS AND OTHER BORROWINGS                
A Fund may enter into reverse repurchase agreements and dollar rolls, subject   
to the Fund's limitations on borrowings. A reverse repurchase agreement or      
dollar roll involves the sale of a security by a Fund and its agreement to      
repurchase the instrument at a specified time and price, and may be considered  
a form of borrowing for some purposes. Reverse repurchase agreements, dollar    
rolls and other forms of borrowings may create leverage risk for a Fund. In     
addition, reverse repurchase agreements and dollar rolls involve the risk that  
the market value of the securities a Fund is obligated to repurchase may        
decline below the purchase price.                                               

Dollar rolls involve sales by a Fund of securities for delivery in the current  
month and the Fund's simultaneously contracting to repurchase substantially     
similar (same type and coupon) securities on a specified future date. During    
the roll period, a Fund forgoes principal and interest paid on the securities.  
A Fund is compensated by the difference between the current sales price and the 
lower forward price for the future purchase (often referred to as the "drop")   
as well as by the interest earned on the cash proceeds of the initial sale.     

Reverse repurchase agreements and dollar rolls involve the risk that the market 
value of the securities a Fund is obligated to repurchase under the agreement   
may decline below the repurchase price. In the event the buyer of securities    
under a reverse repurchase agreement or dollar roll files for bankruptcy or     
becomes insolvent, a Fund's use of the proceeds of the agreement may be         
restricted pending a determination by the other party, or its trustee or        
receiver, whether to enforce the Fund's obligation to repurchase the securities.

RIGHTS AND WARRANTS                                                             
Rights and warrants are option securities permitting their holders to subscribe 
for other securities. Rights are similar to warrants except that they have a    
substantially shorter duration. Rights and warrants do not carry with them      
dividend or voting                                                              

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rights with respect to the underlying securities, or any rights in the assets   
of the issuer. As a result, an investment in rights and warrants may be         
considered more speculative than certain other types of investments. In         
addition, the value of a right or a warrant does not necessarily change with    
the value of the underlying securities, and a right or a warrant ceases to have 
value if it is not exercised prior to its expiration date.                      

SHORT SALES                                                                     
A Fund (except for ALLIANCEBERNSTEIN SHORT DURATION PORTFOLIO) may make short   
sales as a part of overall portfolio management or to offset a potential        
decline in the value of a security. A short sale involves the sale of a         
security that a Fund does not own, or if the Fund owns the security, is not to  
be delivered upon consummation of the sale. When the Fund makes a short sale of 
a security that it does not own, it must borrow from a broker-dealer the        
security sold short and deliver the security to the broker-dealer upon          
conclusion of the short sale.                                                   

If the price of the security sold short increases between the time of the short 
sale and the time a Fund replaces the borrowed security, the Fund will incur a  
loss; conversely, if the price declines, the Fund will realize a gain. The      
potential for the price of a fixed-income security sold short to rise is a      
function of both the remaining maturity of the obligation, its creditworthiness 
and its yield. Unlike short sales of equities or other instruments, potential   
for the price of a fixed-income security to rise may be limited due to the fact 
that the security will be no more than par at maturity. However, the short sale 
of other instruments or securities generally, including fixed-income securities 
convertible into equities or other instruments, a fixed-income security trading 
at a deep discount from par or that pays a coupon that is high in relative      
and/or absolute terms, or that is denominated in a currency other than the      
U.S. Dollar, involves the possibility of a theoretically unlimited loss since   
there is a theoretically unlimited potential for the market price of the        
security sold short to increase.                                                

STANDBY COMMITMENT AGREEMENTS                                                   
Standby commitment agreements are similar to put options that commit a Fund,    
for a stated period of time, to purchase a stated amount of a security that may 
be issued and sold to the Fund at the option of the issuer. The price and       
coupon of the security are fixed at the time of the commitment. At the time of  
entering into the agreement, the Fund is paid a commitment fee, regardless of   
whether the security ultimately is issued. A Fund will enter into such          
agreements only for the purpose of investing in the security underlying the     
commitment at a yield and price considered advantageous to the Fund and         
unavailable on a firm commitment basis.                                         

There is no guarantee that a security subject to a standby commitment will be   
issued. In addition, the value of the security, if issued, on the delivery date 
may be more or less than its purchase price. Since the issuance of the security 
is at the option of the issuer, a Fund will bear the risk of capital loss in    
the event the value of the security declines and may not benefit from an        
appreciation in the value of the security during the commitment period if the   
issuer decides not to issue and sell the security to the Fund.                  

STRUCTURED SECURITIES AND BASKET SECURITIES                                     
A Fund may invest in various types of structured securities and basket          
securities. Structured securities are securities issued in structured financing 
transactions, which generally involve aggregating types of debt assets in a     
pool or special purpose entity and then issuing new securities. Types of        
structured financings include securities described elsewhere in this            
Prospectus, such as mortgage-related and other asset-backed securities. A       
Fund's investments include investments in structured securities that represent  
interests in entities organized and operated solely for the purpose of          
restructuring the investment characteristics of particular debt obligations.    
This type of restructuring involves the deposit with or purchase by an entity,  
such as a corporation or trust, of specified instruments (such as commercial    
bank loans or high yield bonds) and the issuance by that entity of one or more  
classes of structured securities backed by, or representing interests in, the   
underlying instruments. The cash flow on the underlying instruments may be      
apportioned among the newly issued structured securities to create securities   
with different investment characteristics such as varying maturities, payment   
priorities and interest rate provisions, and the extent of the payments made    
with respect to structured securities is dependent on the extent of the cash    
flow from the underlying instruments. Structured securities of a given class    
may be either subordinated or unsubordinated to the payment of another class.   
Subordinated structured securities typically have higher yields and present     
greater risks than unsubordinated structured securities.                        

Basket securities in which a Fund may invest may consist of entities organized  
and operated for the purpose of holding a basket of other securities. Baskets   
involving debt obligations may be designed to represent the characteristics of  
some portion of the debt securities market or the entire debt securities market.

SOVEREIGN DEBT OBLIGATIONS                                                      
No established secondary markets may exist for many sovereign debt obligations. 
Reduced secondary market liquidity may have an adverse effect on the market     
price and a Fund's ability to dispose of particular instruments when necessary  
to meet its liquidity requirements or in response to specific economic events   
such as a deterioration in the creditworthiness of the issuer. Reduced          
secondary market liquidity for certain sovereign debt obligations may also make 
it more difficult for a Fund to obtain accurate market quotations for the       
purpose of valuing its portfolio. Market quotations are generally available on  
many sovereign debt obligations only from a limited number of dealers and may   
not necessarily represent firm bids of those dealers or prices for actual sales.

By investing in sovereign debt obligations, the Funds will be exposed to the    
direct or indirect consequences of political, social, and economic changes in   
various countries. Political changes in a country may affect the willingness of 
a foreign government to make or provide for timely payments of its              

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obligations. The country's economic status, as reflected in, among other        
things, its inflation rate, the amount of its external debt and its gross       
domestic product, will also affect the government's ability to honor its        
obligations.                                                                    

The Funds are permitted to invest in sovereign debt obligations that are not    
current in the payment of interest or principal or are in default so long as    
the Adviser believes it to be consistent with the Funds' investment objectives. 
The Funds may have limited legal recourse in the event of a default with        
respect to certain sovereign debt obligations they hold. For example, remedies  
from defaults on certain sovereign debt obligations, unlike those on private    
debt, must, in some cases, be pursued in the courts of the defaulting party     
itself. Legal recourse therefore may be significantly diminished. Bankruptcy,   
moratorium, and other similar laws applicable to issuers of sovereign debt      
obligations may be substantially different from those applicable to issuers of  
private debt obligations. The political context, expressed as the willingness   
of an issuer of sovereign debt obligations to meet the terms of the debt        
obligation, for example, is of considerable importance. In addition, no         
assurance can be given that the holders of commercial bank debt will not        
contest payments to the holders of securities issued by foreign governments in  
the event of default under commercial bank loan agreements.                     

VARIABLE, FLOATING AND INVERSE FLOATING RATE INSTRUMENTS                        
Variable and floating rate securities pay interest at rates that are adjusted   
periodically, according to a specified formula. A "variable" interest rate      
adjusts at predetermined intervals (e.g., daily, weekly or monthly), while a    
"floating" interest rate adjusts whenever a specified benchmark rate (such as   
the bank prime lending rate) changes.                                           

A Fund may also invest in inverse floating rate debt instruments ("inverse      
floaters"). The interest rate on an inverse floater resets in the opposite      
direction from the market rate of interest to which the inverse floater is      
indexed. An inverse floater may have greater volatility in market value, in     
that, during periods of rising interest rates, the market values of inverse     
floaters will tend to decrease more rapidly than those of fixed rate securities.

ZERO COUPON AND PRINCIPAL-ONLY SECURITIES                                       
Zero coupon securities and principal-only (PO) securities are debt securities   
that have been issued without interest coupons or stripped of their unmatured   
interest coupons, and include receipts or certificates representing interests   
in such stripped debt obligations and coupons. Such a security pays no interest 
to its holder during its life. Its value to an investor consists of the         
difference between its face value at the time of maturity and the price for     
which it was acquired, which is generally an amount significantly less than its 
face value. Such securities usually trade at a deep discount from their face or 
par value and are subject to greater fluctuations in market value in response   
to changing interest rates than debt obligations of comparable maturities and   
credit quality that make current distributions of interest. On the other hand,  
because there are no periodic interest payments to be reinvested prior to       
maturity, these securities eliminate reinvestment risk and "lock in" a rate of  
return to maturity.                                                             

ADDITIONAL RISK AND OTHER CONSIDERATIONS                                        
Investments in the Funds involve the special risk considerations described      
below. Certain of these risks may be heightened when investing in emerging      
markets.                                                                        

BORROWING AND LEVERAGE                                                          
The Funds may use borrowings for investment purposes subject to applicable      
statutory or regulatory requirements. Borrowings by a Fund result in leveraging 
of the Fund's shares. A Fund may also use leverage for investment transactions  
by entering into transactions such as reverse repurchase agreements, forward    
contracts and dollar rolls. This means that a Fund uses cash made available     
during the term of these transactions to make investments in other fixed-income 
securities.                                                                     

Utilization of leverage, which is usually considered speculative, involves      
certain risks to a Fund's shareholders. These include a higher volatility of    
the NAV of a Fund's shares and the relatively greater effect on the NAV of the  
shares. So long as a Fund is able to realize a net return on its investment     
portfolio that is higher than the interest expense paid on borrowings or the    
carrying costs of leveraged transactions, the effect of leverage will be to     
cause the Fund's shareholders to realize a higher current net investment income 
than if the Fund were not leveraged. If the interest expense on borrowings or   
the carrying costs of leveraged transactions approaches the net return on a     
Fund's investment portfolio, the benefit of leverage to the Fund's shareholders 
will be reduced. If the interest expense on borrowings or the carrying costs of 
leveraged transactions were to exceed the net return to shareholders, a Fund's  
use of leverage would result in a lower rate of return. Similarly, the effect   
of leverage in a declining market could be a greater decrease in NAV. In an     
extreme case, if a Fund's current investment income were not sufficient to meet 
the interest expense on borrowings or the carrying costs of leveraged           
transactions, it could be necessary for the Fund to liquidate certain of its    
investments, thereby reducing its NAV.                                          

FOREIGN (NON-U.S.) SECURITIES                                                   
Investing in foreign securities involves special risks and considerations not   
typically associated with investing in U.S. securities. The securities markets  
of many foreign countries are relatively small, with the majority of market     
capitalization and trading volume concentrated in a limited number of companies 
representing a small number of industries. A Fund that invests in foreign       
fixed-income securities may experience greater price volatility and             
significantly lower liquidity than a portfolio invested solely in securities of 
U.S. companies. These markets may be subject to greater influence by adverse    
events generally affecting the market, and by large investors trading           
significant blocks of securities, than is usual in the United States.           

Securities registration, custody, and settlement may in some instances be       
subject to delays and legal and administrative uncertainties. Foreign           
investment in the securities markets of certain foreign countries is restricted 
or controlled to varying                                                        

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degrees. These restrictions or controls may at times limit or preclude          
investment in certain securities and may increase the cost and expenses of a    
Fund. In addition, the repatriation of investment income, capital or the        
proceeds of sales of securities from certain of the countries is controlled     
under regulations, including in some cases the need for certain advance         
government notification or authority, and if a deterioration occurs in a        
country's balance of payments, the country could impose temporary restrictions  
on foreign capital remittances.                                                 

A Fund also could be adversely affected by delays in, or a refusal to grant,    
any required governmental approval for repatriation, as well as by the          
application to it of other restrictions on investment. Investing in local       
markets may require a Fund to adopt special procedures or seek local            
governmental approvals or other actions, any of which may involve additional    
costs to a Fund. These factors may affect the liquidity of a Fund's investments 
in any country and the Adviser will monitor the effect of any such factor or    
factors on a Fund's investments. Transaction costs, including brokerage         
commissions for transactions both on and off the securities exchanges, in many  
foreign countries are generally higher than in the United States.               

Issuers of securities in foreign jurisdictions are generally not subject to the 
same degree of regulation as are U.S. issuers with respect to such matters as   
insider trading rules, restrictions on market manipulation, shareholder proxy   
requirements, and timely disclosure of information. The reporting, accounting,  
and auditing standards of foreign countries may differ, in some cases           
significantly, from U.S. standards in important respects, and less information  
may be available to investors in foreign securities than to investors in U.S.   
securities. Substantially less information is publicly available about certain  
non-U.S. issuers than is available about most U.S. issuers.                     

The economies of individual foreign countries may differ favorably or           
unfavorably from the U.S. economy in such respects as growth of gross domestic  
product or gross national product, rate of inflation, capital reinvestment,     
resource self-sufficiency, and balance of payments position. Nationalization,   
expropriation or confiscatory taxation, currency blockage, political changes,   
government regulation, political or social instability, revolutions, wars or    
diplomatic developments could affect adversely the economy of a foreign         
country. In the event of nationalization, expropriation, or other confiscation, 
a Fund could lose its entire investment in securities in the country involved.  
In addition, laws in foreign countries governing business organizations,        
bankruptcy and insolvency may provide less protection to security holders such  
as the Fund than that provided by U.S. laws.                                    

Investments in securities of companies in emerging markets involve special      
risks. There are approximately 100 countries identified by the World Bank as    
Low Income, Lower Middle Income and Upper Middle Income countries that are      
generally regarded as Emerging Markets. Emerging market countries that the      
Adviser currently considers for investment are listed below. Countries may be   
added to or removed from this list at any time.                                 

                                                                [Download Table]
                                                  
Algeria             Hong Kong    Poland           
Argentina           Hungary      Qatar            
Belize              India        Romania          
Brazil              Indonesia    Russia           
Bulgaria            Israel       Singapore        
Chile               Jamaica      Slovakia         
China               Jordan       Slovenia         
Colombia            Kazakhstan   South Africa     
Costa Rica          Lebanon      South Korea      
Cote D'Ivoire       Malaysia     Taiwan           
Croatia             Mexico       Thailand         
Czech Republic      Morocco      Trinidad & Tobago
Dominican Republic  Nigeria      Tunisia          
Ecuador             Pakistan     Turkey           
Egypt               Panama       Ukraine          
El Salvador         Peru         Uruguay          
Guatemala           Philippines  Venezuela        

Investing in emerging market securities imposes risks different from, or        
greater than, risks of investing in domestic securities or in foreign,          
developed countries. These risks include: smaller market capitalization of      
securities markets, which may suffer periods of relative illiquidity;           
significant price volatility; restrictions on foreign investment; and possible  
repatriation of investment income and capital. In addition, foreign investors   
may be required to register the proceeds of sales; future economic or political 
crises could lead to price controls, forced mergers, expropriation or           
confiscatory taxation, seizure, nationalization, or creation of government      
monopolies. The currencies of emerging market countries may experience          
significant declines against the U.S. Dollar, and devaluation may occur         
subsequent to investments in these currencies by a Fund. Inflation and rapid    
fluctuations in inflation rates have had, and may continue to have, negative    
effects on the economies and securities markets of certain emerging market      
countries.                                                                      

Additional risks of emerging market securities may include: greater social,     
economic and political uncertainty and instability; more substantial            
governmental involvement in the economy; less governmental supervision and      
regulation; unavailability of currency hedging techniques; companies that are   
newly organized and small; differences in auditing and financial reporting      
standards, which may result in unavailability of material information about     
issuers; and less developed legal systems. In addition, emerging securities     
markets may have different clearance and settlement procedures, which may be    
unable to keep pace with the volume of securities transactions or otherwise     
make it difficult to engage in such transactions. Settlement problems may cause 
a Fund to miss attractive investment opportunities, hold a portion of its       
assets in cash pending investment, or be delayed in disposing of a portfolio    
security. Such a delay could result in possible liability to a purchaser of the 
security.                                                                       

FOREIGN (NON-U.S.) CURRENCIES                                                   
A Fund that invests some portion of its assets in securities denominated in,    
and receives revenues in, foreign currencies will be adversely affected by      
reductions in the value of those                                                

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currencies relative to the U.S. Dollar. Foreign currency exchange rates may     
fluctuate significantly. They are determined by supply and demand in the        
foreign exchange markets, the relative merits of investments in different       
countries, actual or perceived changes in interest rates, and other complex     
factors. Currency exchange rates also can be affected unpredictably by          
intervention (or the failure to intervene) by U.S. or foreign governments or    
central banks or by currency controls or political developments. In light of    
these risks, a Fund may engage in certain currency hedging transactions, as     
described above, which involve certain special risks.                           

A Fund may also invest directly in foreign currencies for non-hedging purposes  
directly on a spot basis (i.e., cash) or through derivative transactions, such  
as forward currency exchange contracts, futures and options thereon, swaps and  
options as described above. These investments will be subject to the same       
risks. In addition, currency exchange rates may fluctuate significantly over    
short periods of time, causing a Fund's NAV to fluctuate.                       

INVESTMENT IN BELOW INVESTMENT GRADE FIXED-INCOME SECURITIES                    
Investments in securities rated below investment grade (commonly known as "junk 
bonds") may be subject to greater risk of loss of principal and interest than   
higher-rated securities. These securities are also generally considered to be   
subject to greater market risk than higher-rated securities. The capacity of    
issuers of these securities to pay interest and repay principal is more likely  
to weaken than is that of issuers of higher-rated securities in times of        
deteriorating economic conditions or rising interest rates. In addition, below  
investment grade securities may be more susceptible to real or perceived        
adverse economic conditions than investment grade securities.                   

The market for these securities may be thinner and less active than that for    
higher-rated securities, which can adversely affect the prices at which these   
securities can be sold. To the extent that there is no established secondary    
market for these securities, a Fund may experience difficulty in valuing such   
securities and, in turn, the Fund's assets.                                     

UNRATED SECURITIES                                                              
A Fund may invest in unrated securities when the Adviser believes that the      
financial condition of the issuers of such securities, or the protection        
afforded by the terms of the securities themselves, limits the risk to the Fund 
to a degree comparable to that of rated securities that are consistent with the 
Fund's objective and policies.                                                  

FUTURE DEVELOPMENTS                                                             
A Fund may take advantage of other investment practices that are not currently  
contemplated for use by the Fund, or are not available but may yet be           
developed, to the extent such investment practices are consistent with the      
Fund's investment objective and legally permissible for the Fund. Such          
investment practices, if they arise, may involve risks that exceed those        
involved in the activities described above.                                     

CHANGES IN INVESTMENT OBJECTIVES AND POLICIES                                   
A Fund's Board of Directors (the "Board") may change the Fund's investment      
objective without shareholder approval. The Fund will provide shareholders with 
60 days' prior written notice of any change to the Fund's investment objective. 
Unless otherwise noted, all other investment policies of a Fund may be changed  
without shareholder approval.                                                   

TEMPORARY DEFENSIVE POSITION                                                    
For temporary defensive purposes in an attempt to respond to adverse market,    
economic, political or other conditions, each Fund may invest in certain types  
of short-term, liquid, investment grade or high quality (depending on the Fund) 
debt securities. While a Fund is investing for temporary defensive purposes, it 
may not meet its investment objectives.                                         

PORTFOLIO HOLDINGS                                                              
A description of the Funds' policies and procedures with respect to the         
disclosure of the Funds' portfolio securities is available in the Funds' SAIs.  

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INVESTING IN THE FUNDS                                                          
--------------------------------------------------------------------------------

This section discusses how to buy, sell or redeem, or exchange different        
classes of shares of a Fund that are offered in this Prospectus.                
ALLIANCEBERNSTEIN INTERMEDIATE BOND, ALLIANCEBERNSTEIN DIVERSIFIED YIELD,       
ALLIANCEBERNSTEIN GLOBAL BOND and ALLIANCEBERNSTEIN HIGH INCOME offer four      
classes of shares and ALLIANCEBERNSTEIN SHORT DURATION offers three classes of  
shares through this Prospectus. Retirement shares of ALLIANCEBERNSTEIN          
INTERMEDIATE BOND, ALLIANCEBERNSTEIN DIVERSIFIED YIELD, ALLIANCEBERNSTEIN       
GLOBAL BOND and ALLIANCEBERNSTEIN HIGH INCOME are available through a separate  
prospectus.                                                                     

Each share class represents an investment in the same portfolio of securities,  
but the classes may have different sales charges and bear different ongoing     
distribution expenses. For additional information on the differences between    
the different classes of shares and factors to consider when choosing among     
them, please see "The Different Share Class Expenses" and "The 'Pros' and       
'Cons' of Different Share Classes" below. ONLY CLASS A SHARES OFFER QUANTITY    
DISCOUNTS ON SALES CHARGES, as described under "Sales Charge Reduction          
Programs" below.                                                                

HOW TO BUY SHARES                                                               
The purchase of a Fund's shares is priced at the next determined NAV after your 
order is received in proper form.                                               

CLASS A, CLASS B AND CLASS C SHARES                                             
EFFECTIVE JANUARY 31, 2009, SALES OF CLASS B SHARES OF THE FUNDS TO NEW         
INVESTORS WERE SUSPENDED. CLASS B SHARES MAY ONLY BE PURCHASED (I) BY EXISTING  
CLASS B SHAREHOLDERS AS OF JANUARY 31, 2009, (II) THROUGH EXCHANGE OF CLASS B   
SHARES FROM ANOTHER ALLIANCEBERNSTEIN MUTUAL FUND, OR (III) AS OTHERWISE        
DESCRIBED BELOW.                                                                

You may purchase a Fund's Class A, Class B, or Class C shares through financial 
intermediaries, such as broker-dealers or banks. You also may purchase shares   
directly from the Funds' principal underwriter, AllianceBernstein Investments,  
Inc., or ABI.                                                                   

PURCHASE MINIMUMS AND MAXIMUMS                                                  

MINIMUMS:*                                                                      

                                                                [Download Table]
                     
--Initial:     $2,500
--Subsequent:  $   50

*These purchase minimums may not apply to some accounts established in          
connection with the Automatic Investment Program and to some                  
retirement-related investment programs. Please see "Automatic Investment      
Program" and "Retirement Plans, Tax-Deferred Accounts and Employee Benefit    
Plans" below. Additionally, these investment minimums do not apply to persons 
participating in a fee-based program sponsored and maintained by a registered 
broker-dealer or other financial intermediary and approved by ABI.            

MAXIMUM INDIVIDUAL PURCHASE AMOUNT:                                             

                                                                [Download Table]
                            
--Class A shares        None
--Class B shares  $  100,000
--Class C shares  $1,000,000

Your broker or financial advisor must receive your purchase request by 4:00     
p.m., Eastern time, and submit it to the Fund by a pre-arranged time for you to 
receive the next-determined NAV, less any applicable initial sales charge.      

If you are an existing Fund shareholder and you have completed the appropriate  
section of the Mutual Fund Application, you may purchase additional shares by   
telephone with payment by electronic funds transfer in amounts not exceeding    
$500,000. AllianceBernstein Investor Services, Inc., or ABIS, must receive and  
confirm telephone requests before 4:00 p.m., Eastern time, to receive that      
day's public offering price. Call 800-221-5672 to arrange a transfer from your  
bank account.                                                                   

ADVISOR CLASS SHARES                                                            
You may purchase Advisor Class shares through your financial advisor at NAV.    
Advisor Class shares may be purchased and held solely:                          

..  through accounts established under a fee-based program, sponsored and       
  maintained by a registered broker-dealer or other financial intermediary and
approved by ABI;                                                          

..  through a defined contribution employee benefit plan (e.g., a 401(k) plan)  
that has at least $10,000,000 in assets and that purchases shares directly
without the involvement of a financial intermediary; and                  

..  by investment advisory clients of, and certain other persons associated     
with, the Adviser and its affiliates or the Funds.                        

The Funds' SAIs have more detailed information about who may purchase and hold  
Advisor Class shares.                                                           

RETIREMENT PLANS, TAX-DEFERRED ACCOUNTS AND EMPLOYEE BENEFIT PLANS              
Special eligibility rules apply to these types of investments. Except as        
indicated, there are no investment minimums for the plans listed below. Class A 
shares are available to:                                                        

..  Traditional and Roth IRAs (the minimums listed in the table above apply);   

..  SEPs, SAR-SEPs, SIMPLE IRAs, and individual 403(b) plans;                   

..  AllianceBernstein-sponsored Coverdell Education Savings Accounts ($2,000    
initial investment minimum, $150 automatic investment program monthly     
minimum);                                                                 

..  AllianceBernstein Link, AllianceBernstein Individual 401(k), and            
AllianceBernstein SIMPLE IRA plans; and                                   

..  certain defined contribution retirement plans that do not have plan level or
omnibus accounts on the books of the Fund.                                

Group retirement plans that selected Class B shares as an investment            
alternative under their plans before September 2, 2003 may continue to purchase 
Class B shares.                                                                 

Class C shares are available to AllianceBernstein Link, AllianceBernstein       
Individual 401(k), and AllianceBernstein SIMPLE IRA plans with less than        
$250,000 in plan assets and                                                     

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100 employees, and to group retirement plans with plan assets of less than      
$1,000,000.                                                                     

REQUIRED INFORMATION                                                            
A Fund is required by law to obtain, verify, and record certain personal        
information from you or persons on your behalf in order to establish an         
account. Required information includes name, date of birth, permanent           
residential address and taxpayer identification number (for most investors,     
your social security number). A Fund may also ask to see other identifying      
documents. If you do not provide the information, the Fund will not be able to  
open your account. If a Fund is unable to verify your identity, or that of      
another person(s) authorized to act on your behalf, or, if the Fund believes it 
has identified potentially criminal activity, the Fund reserves the right to    
take action it deems appropriate or as required by law, which may include       
closing your account. If you are not a U.S. citizen or resident alien, your     
account must be affiliated with a Financial Industry Regulatory Authority, or   
FINRA, member firm.                                                             

A Fund is required to withhold 28% of taxable dividends, capital gains          
distributions, and redemptions paid to any shareholder who has not provided the 
Fund with his or her correct taxpayer identification number. To avoid this, you 
must provide your correct tax identification number on your Mutual Fund         
Application.                                                                    

GENERAL                                                                         
ABI may refuse any order to purchase shares. Each Fund reserves the right to    
suspend the sale of its shares to the public in response to conditions in the   
securities markets or for other reasons.                                        

THE DIFFERENT SHARE CLASS EXPENSES                                              
This section describes the different expenses of investing in each class and    
explains factors to consider when choosing a class of shares. The expenses can  
include distribution and/or service (Rule 12b-1) fees, initial sales charges    
and/or CDSCs. ONLY CLASS A SHARES OFFER QUANTITY DISCOUNTS as described below.  

WHAT IS A RULE 12B-1 FEE? 
A Rule 12b-1 fee is a fee deducted from a Fund's assets that is used to pay 
for personal service, maintenance of shareholder accounts and distribution  
costs, such as advertising and compensation of financial intermediaries. The
amount of each share class's Rule 12b-1 fee, if any, is disclosed below and 
in a Fund's fee table included in Summary Information section above.        

ASSET-BASED SALES CHARGES OR DISTRIBUTION AND/OR SERVICE (RULE 12B-1) FEES      
Each Fund has adopted a plan under Commission Rule 12b-1 that allows the Fund   
to pay asset-based sales charges or distribution and/or service (Rule 12b-1)    
fees for the distribution and sale of its shares. The amount of these fees for  
each class of the Fund's shares is up to:                                       

                                                                [Download Table]

               DISTRIBUTION AND/OR SERVICE
                 (RULE 12B-1) FEE (AS A   
                 PERCENTAGE OF AGGREGATE  
                AVERAGE DAILY NET ASSETS) 
------------------------------------------
                                          
Class A                    .30%           
Class B                   1.00%           
Class C                   1.00%           
Advisor Class             None            

Because these fees are paid out of a Fund's assets on an ongoing basis, over    
time these fees will increase the cost of your investment and may cost you more 
than paying other types of sales fees. Class B and Class C shares are subject   
to higher Rule 12b-1 fees than Class A shares. Class B shares are subject to    
these higher fees for a period of six years, after which they convert to        
Class A shares (except for ALLIANCEBERNSTEIN DIVERSIFIED YIELD Class B shares,  
which convert to Class A shares after eight years). Because higher fees mean a  
higher expense ratio, Class B and Class C shares pay correspondingly lower      
dividends and may have a lower NAV (and returns) than Class A shares. All or    
some of these fees may be paid to financial intermediaries, including your      
financial advisor's firm.                                                       

CLASS A SHARES - INITIAL SALES CHARGE ALTERNATIVE                               
You can purchase Class A shares at their public offering price (or cost), which 
is NAV plus an initial sales charge of up to 4.25% of the offering price. Any   
applicable sales charge will be deducted directly from your investment. Larger  
investments are subject to "breakpoints or quantity discounts" as discussed     
below. Purchases of Class A shares in the amount of $1,000,000 or more or by    
AllianceBernstein or non-AllianceBernstein sponsored group retirement plans are 
not subject to an initial sales charge, but may be subject to a 1% CDSC if      
redeemed or terminated within one year.                                         

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CLASS B SHARES - DEFERRED SALES CHARGE ALTERNATIVE                              
EFFECTIVE JANUARY 31, 2009, SALES OF CLASS B SHARES OF THE FUNDS TO NEW         
INVESTORS WERE SUSPENDED. CLASS B SHARES MAY ONLY BE PURCHASED (I) BY EXISTING  
CLASS B SHAREHOLDERS AS OF JANUARY 31, 2009, (II) THROUGH EXCHANGE OF CLASS B   
SHARES FROM ANOTHER ALLIANCEBERNSTEIN MUTUAL FUND, OR (III) AS OTHERWISE        
DESCRIBED BELOW.                                                                

You can purchase Class B shares at NAV without an initial sales charge. This    
means that the full amount of your purchase is invested in the Fund. Your       
investment is subject to a CDSC if you redeem shares within three years (four   
years in the case of ALLIANCEBERNSTEIN DIVERSIFIED YIELD) of purchase. The CDSC 
varies depending on the number of years you hold the shares. The CDSC amounts   
for Class B shares are:                                                         

ALLIANCEBERNSTEIN DIVERSIFIED YIELD:                                            

                                                                [Download Table]

YEAR SINCE PURCHASE   CDSC 
---------------------------
                           
First                  4.0%
Second                 3.0%
Third                  2.0%
Fourth                 1.0%
Fifth and thereafter  None 

ALL OTHER FUNDS:                                                                

                                                                [Download Table]

YEAR SINCE PURCHASE    CDSC 
----------------------------
                            
First                   3.0%
Second                  2.0%
Third                   1.0%
Fourth and thereafter  None 

If you exchange your shares for the Class B shares of another AllianceBernstein 
Mutual Fund, the CDSC also will apply to the Class B shares received. If you    
redeem your shares and directly invest the proceeds in units of                 
CollegeBoundfund, the CDSC will apply to the units of CollegeBoundfund. The     
CDSC period begins with the date of your original purchase, not the date of     
exchange for the other Class B shares or purchase of CollegeBoundfund units.    

Class B shares purchased for cash automatically convert to Class A shares six   
years after the end of the month of your purchase (except for Class B shares of 
ALLIANCEBERNSTEIN DIVERSIFIED YIELD, which automatically convert to Class A     
shares eight years after the end of the month of your purchase). If you         
purchase shares by exchange for the Class B shares of another AllianceBernstein 
Mutual Fund, the conversion period runs from the date of your original purchase.

CLASS C SHARES - ASSET-BASED SALES CHARGE ALTERNATIVE                           
You can purchase Class C shares at NAV without an initial sales charge. This    
means that the full amount of your purchase is invested in the Fund. Your       
investment is subject to a 1% CDSC if you redeem your shares within 1 year. If  
you exchange your shares for the Class C shares of another AllianceBernstein    
Mutual Fund, the 1% CDSC also will apply to the Class C shares received. If you 
redeem your shares and directly invest the proceeds in units of                 
CollegeBoundfund, the CDSC will apply to the units of CollegeBoundfund. The     
1-year period for the CDSC begins with the date of your original purchase, not  
the date of the exchange for the other Class C shares or purchase of            
CollegeBoundfund units.                                                         

Class C shares do not convert to any other class of shares of the Fund.         

HOW IS THE CDSC CALCULATED? 
The CDSC is applied to the lesser of NAV at the time of redemption or the   
original cost of shares being redeemed (or, as to Fund shares acquired      
through an exchange, the cost of the AllianceBernstein Mutual Fund shares   
originally purchased for cash). This means that no sales charge is assessed 
on increases in NAV above the initial purchase price. Shares obtained from  
dividend or distribution reinvestment are not subject to the CDSC. In       
determining the CDSC, it will be assumed that the redemption is, first, of  
any shares not subject to a CDSC and, second, of shares held the longest.   

ADVISOR CLASS SHARES - FEE-BASED PROGRAM ALTERNATIVE                            
You may purchase Advisor Class shares through your financial advisor. Advisor   
Class shares are not subject to any initial or contingent sales charges,        
although your financial advisor may charge a fee.                               

SALES CHARGE REDUCTION PROGRAMS                                                 
THIS SECTION INCLUDES IMPORTANT INFORMATION ABOUT SALES CHARGE REDUCTION        
PROGRAMS AVAILABLE TO INVESTORS IN CLASS A SHARES AND DESCRIBES INFORMATION OR  
RECORDS YOU MAY NEED TO PROVIDE TO A FUND OR YOUR FINANCIAL INTERMEDIARY IN     
ORDER TO BE ELIGIBLE FOR SALES CHARGE REDUCTION PROGRAMS.                       

Information about sales charge reduction programs also is available free of     
charge and in a clear and prominent format on our website at                    
www.AllianceBernstein.com (click on "AllianceBernstein Mutual Fund              
Investors -US" then "Investment Insights--Investor Education" then "Sales       
Charge Reduction Programs"). More information on BREAKPOINTS and other sales    
charge waivers is available in the Funds' SAI.                                  

You Can Reduce Sales Charges  
When Buying Class A Shares. 

BREAKPOINTS OR QUANTITY DISCOUNTS OFFERED BY THE FUNDS                          
The Funds offer investors the benefit of discounts on the sales charges that    
apply to purchases of Class A shares in certain circumstances. These discounts, 
which are also known as BREAKPOINTS, can reduce or, in some cases, eliminate    
the initial sales charges that would otherwise apply to your Class A            
investment. Mutual funds are not required to offer breakpoints and different    
mutual fund groups may offer different types of breakpoints.                    

BREAKPOINTS or QUANTITY DISCOUNTS allow larger investments in Class A shares to 
be charged lower sales charges. A shareholder investing more than $100,000 in   
Class A shares of a Fund is eligible for a reduced sales charge. Initial sales  
charges are eliminated completely for purchases of $1,000,000 or more, although 
a 1%, 1-year CDSC may apply.                                                    

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The sales charge schedule of Class A share QUANTITY DISCOUNTS is as follows:    

                                                                [Download Table]

                           INITIAL SALES CHARGE
                           ------------------  
                            AS % OF    AS % OF 
                           NET AMOUNT  OFFERING
AMOUNT PURCHASED            INVESTED    PRICE  
-----------------------------------------------
                                               
Up to $100,000                4.44%      4.25% 
$100,000 up to $250,000       3.36       3.25  
$250,000 up to $500,000       2.30       2.25  
$500,000 up to $1,000,000     1.78       1.75  
$1,000,000 and above          0.00       0.00  

RIGHTS OF ACCUMULATION                                                          
To determine if a new investment in Class A shares is eligible for a QUANTITY   
DISCOUNT, a shareholder can combine the value of the new investment in a Fund   
with the value of existing investments in the Fund, any other AllianceBernstein 
Mutual Fund, AllianceBernstein Institutional Funds and certain CollegeBoundfund 
accounts for which the shareholder, his or her spouse or domestic partner, or   
child under the age of 21 is the participant. The AllianceBernstein Mutual      
Funds use the current NAV of your existing investments when combining them with 
your new investment.                                                            

COMBINED PURCHASE PRIVILEGES                                                    
A shareholder may qualify for a QUANTITY DISCOUNT by combining purchases of     
shares of a Fund into a single "purchase." A "purchase" means a single purchase 
or concurrent purchases of shares of a Fund or any other AllianceBernstein      
Mutual Fund, including AllianceBernstein Institutional Funds, by:               

..  an individual, his or her spouse or domestic partner, or the individual's   
children under the age of 21 purchasing shares for his, her or their own  
account(s), including certain CollegeBoundfund accounts;                  

..  a trustee or other fiduciary purchasing shares for a single trust, estate or
single fiduciary account with one or more beneficiaries involved;         

..  the employee benefit plans of a single employer; or                         

..  any company that has been in existence for at least six months or has a     
purpose other than the purchase of shares of the Fund.                    

LETTER OF INTENT                                                                
An investor may not immediately invest a sufficient amount to reach a QUANTITY  
DISCOUNT, but may plan to make one or more additional investments over a period 
of time that, in the end, would qualify for a QUANTITY DISCOUNT. For these      
situations, the Funds offer a LETTER OF INTENT, which permits the investor to   
express the intention, in writing, to invest at least $100,000 in Class A       
shares of the Fund or any AllianceBernstein Mutual Fund within 13 months. The   
Fund will then apply the QUANTITY DISCOUNT to each of the investor's purchases  
of Class A shares that would apply to the total amount stated in the LETTER OF  
INTENT. If an investor fails to invest the total amount stated in the LETTER OF 
INTENT, the Fund will retroactively collect the sales charges otherwise         
applicable by redeeming shares in the investor's account at their then current  
NAV. Investors qualifying for a Combined Purchase Privilege may purchase shares 
under a single LETTER OF INTENT.                                                

REQUIRED SHAREHOLDER INFORMATION AND RECORDS                                    
In order for shareholders to take advantage of sales charge reductions, a       
shareholder or his or her financial intermediary must notify the Fund that the  
shareholder qualifies for a reduction. Without notification, the Fund is unable 
to ensure that the reduction is applied to the shareholder's account. A         
shareholder may have to provide information or records to his or her financial  
intermediary or a Fund to verify eligibility for breakpoint privileges or other 
sales charge waivers. This may include information or records, including        
account statements, regarding shares of the Fund or other AllianceBernstein     
Mutual Funds held in:                                                           

..  all of the shareholder's accounts at the Funds or a financial intermediary; 

..  any account of the shareholder at another financial intermediary; and       

..  accounts of related parties of the shareholder, such as members of the same 
family, at any financial intermediary.                                    

OTHER PROGRAMS                                                                  
Class A shareholders may be able to purchase additional Class A shares with a   
reduced or eliminated sales charge through the following AllianceBernstein      
programs: DIVIDEND REINVESTMENT PROGRAM, DIVIDEND DIRECTION PLAN and            
REINSTATEMENT PRIVILEGE as described below.                                     

CLASS A SHARES - PURCHASES NOT SUBJECT TO SALES CHARGES                         
The Funds may sell their Class A shares at NAV without an initial sales charge  
to some categories of investors, including:                                     

..  AllianceBernstein Link, AllianceBernstein Individual 401(k), and            
 AllianceBernstein SIMPLE IRA plans with at least $250,000 in plan assets or
100 employees;                                                            

..  persons participating in a fee-based program, sponsored and maintained by a 
registered broker-dealer or other financial intermediary and approved by  
ABI, under which persons pay an asset-based fee for services in the nature
of investment advisory or administrative services;                        

..  plan participants who roll over amounts distributed from employer maintained
retirement plans to AllianceBernstein-sponsored IRAs where the plan is a  
client of or serviced by AllianceBernstein's Institutional Investment     
Management or Bernstein Global Wealth Management Divisions, including     
subsequent contributions to those IRAs; or                                

..  certain other investors, such as investment management clients of the       
 Adviser or its affiliates, including clients and prospective clients of the
Adviser's AllianceBernstein Institutional Investment Management Division, 
employees of selected dealers authorized to sell a Fund's shares, and     
employees of the Adviser.                                                 

Please see the Funds' SAIs for more information about purchases of Class A      
shares without sales charges.                                                   

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CDSC WAIVERS AND OTHER PROGRAMS                                                 

Here Are Some Ways To Avoid Or  
Minimize Charges On Redemption. 

CDSC WAIVERS                                                                    
The Funds will waive the CDSCs on redemptions of shares in the following        
circumstances, among others:                                                    

..  permitted exchanges of shares;                                              

..  following the death or disability of a shareholder;                         

..  if the redemption represents a minimum required distribution from an IRA or 
other retirement plan to a shareholder who has attained the age of 70 1/2;

..  if the proceeds of the redemption are invested directly in a                
CollegeBoundfund account; or                                              

..  if the redemption is necessary to meet a plan participant's or beneficiary's
request for a distribution or loan from a group retirement plan or to     
accommodate a plan participant's or beneficiary's direction to reallocate 
 his or her plan account among other investment alternatives available under
a group retirement plan.                                                  

DIVIDEND REINVESTMENT PROGRAM                                                   
Shareholders may elect to have all income and capital gains distributions from  
their account paid to them in the form of additional shares of the same class   
of a Fund under the Fund's Dividend Reinvestment Program. There is no initial   
sales charge or CDSC imposed on shares issued pursuant to the Dividend          
Reinvestment Program.                                                           

DIVIDEND DIRECTION PLAN                                                         
A shareholder who already maintains accounts in more than one AllianceBernstein 
Mutual Fund may direct the automatic investment of income dividends and/or      
capital gains by one Fund, in any amount, without the payment of any sales      
charges, in shares of the same class of one or more other AllianceBernstein     
Mutual Fund(s).                                                                 

AUTOMATIC INVESTMENT PROGRAM                                                    
The Automatic Investment Program allows investors to purchase shares of a Fund  
through pre-authorized transfers of funds from the investor's bank account.     
Under the Automatic Investment Program, an investor may (i) make an initial     
purchase of at least $2,500 and invest at least $50 monthly or (ii) make an     
initial purchase of less than $2,500 and commit to a monthly investment of $200 
or more until the investor's account balance is $2,500 or more. Shareholders    
who committed to monthly investments of $25 or more through the Automatic       
Investment Program by October 15, 2004 will be able to continue their program   
despite the $50 monthly minimum discussed above. As of January 31, 2009, the    
Automatic Investment Program is available for purchase of Class B shares only   
if a shareholder was enrolled in the Program prior to January 31, 2009. Please  
see the Funds' SAIs for more details.                                           

REINSTATEMENT PRIVILEGE                                                         
A shareholder who has redeemed all or any portion of his or her Class A shares  
may reinvest all or any portion of the proceeds from the redemption in Class A  
shares of any AllianceBernstein Mutual Fund at NAV without any sales charge, if 
the reinvestment is made within 120 calendar days after the redemption date.    

SYSTEMATIC WITHDRAWAL PLAN                                                      
The Funds offer a systematic withdrawal plan that permits the redemption of     
Class A, Class B or Class C shares without payment of a CDSC. Under this plan,  
redemptions equal to 1% a month, 2% every two months or 3% a quarter of the     
value of a Fund account would be free of a CDSC. Shares would be redeemed so    
that Class B shares not subject to a CDSC (such as shares acquired with         
reinvested dividends or distributions) would be redeemed first and Class B      
shares that are held the longest would be redeemed next. For Class A and Class  
C shares, shares held the longest would be redeemed first.                      

THE "PROS" AND "CONS" OF DIFFERENT SHARE CLASSES                                
The decision as to which class of shares is most beneficial to you depends on   
the amount you intend to invest, how long you expect to own shares, and         
expenses associated with owning a particular class of shares. If you are making 
a large investment that qualifies for a reduced sales charge, you might         
consider purchasing Class A shares. Class A shares, with their lower Rule 12b-1 
fees, are designed for investors with a long-term investing time frame.         

Although investors in Class B shares do not pay an initial sales charge, Class  
B shares may be more costly than Class A shares before they convert to Class A  
shares due to their substantially higher Rule 12b-1 fees. Class B shares        
redeemed within three years (four years for ALLIANCEBERNSTEIN DIVERSIFIED       
YIELD) of purchase are also subject to a CDSC. Class B shares are designed for  
investors with an intermediate-term investing time frame.                       

Class C shares should not be considered as a long-term investment because they  
do not convert to Class A shares and are subject to a higher distribution fee   
indefinitely. Class C shares do not, however, have an initial sales charge or a 
CDSC so long as the shares are held for one year or more. Class C shares are    
designed for investors with a short-term investing time frame.                  

Your financial intermediary may receive differing compensation for selling      
Class A, Class B, or Class C shares. See "Payments to Financial Advisors and    
their Firms" below.                                                             

OTHER                                                                           
A transaction, service, administrative or other similar fee may be charged by   
your broker-dealer, agent, or other financial intermediary, with respect to the 
purchase, sale, or exchange of Class A, Class B, Class C, or Advisor Class      
shares made through your financial advisor. The financial intermediaries or     
your fee-based program also may impose requirements on the purchase, sale, or   
exchange of shares that are different from, or in addition to, those imposed by 
the Funds, including requirements as to the minimum initial and subsequent      
investment amounts.                                                             

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YOU SHOULD CONSULT YOUR FINANCIAL ADVISOR FOR ASSISTANCE IN CHOOSING A CLASS OF 
FUND SHARES.                                                                    

PAYMENTS TO FINANCIAL ADVISORS AND THEIR FIRMS                                  
Financial intermediaries market and sell shares of the Funds. These financial   
intermediaries employ financial advisors and receive compensation for selling   
shares of the Funds. This compensation is paid from various sources, including  
any sales charge, CDSC, and/or Rule 12b-1 fee that you or the Funds may pay.    
Your individual financial advisor may receive some or all of the amounts paid   
to the financial intermediary that employs him or her.                          

WHAT IS A FINANCIAL INTERMEDIARY? 
A financial intermediary is a firm that receives compensation for selling   
shares of the Funds offered in this Prospectus and/or provides services to  
the Funds' shareholders. Financial intermediaries may include, among others,
your broker, your financial planner or advisor, banks, and insurance        
companies. Financial intermediaries may employ financial advisors who deal  
with you and other investors on an individual basis.                        

All or a portion of the initial sales charge that you pay may be paid by ABI to 
financial intermediaries selling Class A shares. ABI may also pay these         
financial intermediaries a fee of up to 1% on purchases of $1,000,000 or more   
or for AllianceBernstein Link, AllianceBernstein SIMPLE IRA plans with more     
than $250,000 in assets or for purchases made by certain other retirement plans.

ABI may pay, at the time of your purchase, a commission to financial            
intermediaries selling Class B shares in an amount equal to 4% of your          
investment for sales of Class B shares and an amount equal to 1% of your        
investment for sales of Class C shares.                                         

For Class A and Class C shares, up to 100% and, for Class B shares, up to 30%   
of the Rule 12b-1 fees applicable to these Classes of shares each year may be   
paid to financial intermediaries.                                               

In the case of Advisor Class shares, your financial advisor may charge ongoing  
fees or transactional fees.                                                     

Your financial advisor's firm receives compensation from the Funds, ABI,    
and/or the Adviser in several ways from various sources, which include some 
or all of the following:                                                    

- upfront sales commissions;                                                
- Rule 12b-1 fees;                                                          
- additional distribution support;                                          
- defrayal of costs for educational seminars and training; and              
- payments related to providing shareholder recordkeeping and/or transfer   
agency services.                                                        

Please read the Prospectus carefully for information on this compensation.  

OTHER PAYMENTS FOR DISTRIBUTION SERVICES AND EDUCATIONAL SUPPORT                
In addition to the commissions paid to financial intermediaries at the time of  
sale and Rule 12b-1 fees, some or all of which may be paid to financial         
intermediaries (and, in turn, to your financial advisor), ABI, at its expense,  
currently provides additional payments to firms that sell shares of the         
AllianceBernstein Mutual Funds. Although the individual components may be       
higher and the total amount of payments made to each qualifying firm in any     
given year may vary, the total amount paid to a financial intermediary in       
connection with the sale of shares of the AllianceBernstein Mutual Funds will   
generally not exceed the sum of (a) 0.25% of the current year's fund sales by   
that firm and (b) 0.10% of average daily net assets attributable to that firm   
over the year. These sums include payments to reimburse directly or indirectly  
the costs incurred by these firms and their employees in connection with        
educational seminars and training efforts about the AllianceBernstein Mutual    
Funds for the firms' employees and/or their clients and potential clients. The  
costs and expenses associated with these efforts may include travel, lodging,   
entertainment and meals. ABI may pay a portion of "ticket" or other             
transactional charges.                                                          

For 2011, ABI's additional payments to these firms for distribution services    
and educational support related to the AllianceBernstein Mutual Funds are       
expected to be approximately 0.04% of the average monthly assets of the         
AllianceBernstein Mutual Funds, or approximately $18.0 million. In 2010, ABI    
paid approximately 0.04% of the average monthly assets of the AllianceBernstein 
Mutual Funds or approximately $16.5 million for distribution services and       
educational support related to the AllianceBernstein Mutual Funds.              

A number of factors are considered in determining the additional payments,      
including each firm's AllianceBernstein Mutual Fund sales, assets and           
redemption rates, and the willingness and ability of the firm to give ABI       
access to its financial advisors for educational and marketing purposes. In     
some cases, firms will include the AllianceBernstein Mutual Funds on a          
"preferred list." ABI's goal is to make the financial advisors who interact     
with current and prospective investors and shareholders more knowledgeable      
about the AllianceBernstein Mutual Funds so that they can provide suitable      
information and advice about the funds and related investor services.           

The Funds and ABI also make payments for recordkeeping and other transfer       
agency services to financial intermediaries that sell AllianceBernstein Mutual  
Fund shares. Please see "Management of the Funds--Transfer Agency and           
Retirement Plan Services" below. These expenses paid by the Funds are included  
in "Other Expenses" under "Fees and Expenses of the Fund--Annual Fund Operating 
Expenses" in the Summary Information at the beginning of the Prospectus.        

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IF ONE MUTUAL FUND SPONSOR MAKES GREATER DISTRIBUTION ASSISTANCE PAYMENTS   
 THAN ANOTHER YOUR FINANCIAL ADVISOR AND HIS OR HER FIRM MAY HAVE AN INCENTIVE
TO RECOMMEND ONE FUND COMPLEX OVER ANOTHER. SIMILARLY IF YOUR FINANCIAL     
ADVISOR OR HIS OR HER FIRM RECEIVES MORE DISTRIBUTION ASSISTANCE FOR ONE    
SHARE CLASS VERSUS ANOTHER THEN THEY MAY HAVE AN INCENTIVE TO RECOMMEND THAT
CLASS.                                                                      

PLEASE SPEAK WITH YOUR FINANCIAL ADVISOR TO LEARN MORE ABOUT THE TOTAL      
AMOUNTS PAID TO YOUR FINANCIAL ADVISOR AND HIS OR HER FIRM BY THE FUNDS, THE
ADVISER, ABI, AND BY SPONSORS OF OTHER MUTUAL FUNDS HE OR SHE MAY RECOMMEND 
 TO YOU. YOU SHOULD ALSO CONSULT DISCLOSURES MADE BY YOUR FINANCIAL ADVISOR AT
THE TIME OF PURCHASE.                                                       

As of the date of the Prospectus, ABI anticipates that the firms that will      
receive additional payments for distribution services and/or educational        
support include:                                                                

Advisor Group, Inc.                                                         
Ameriprise Financial Services                                               
AXA Advisors                                                                
Bank of America                                                             
Cadaret, Grant & Co.                                                        
CCO Investment Services Corp.                                               
Chase Investment Services                                                   
Commonwealth Financial Network                                              
Donegal Securities                                                          
Financial Network Investment Company                                        
LPL Financial Corporation                                                   
Merrill Lynch                                                               
Morgan Stanley Smith Barney                                                 
Multi-Financial Securities Corporation                                      
Northwestern Mutual Investment Services                                     
PrimeVest Financial Services                                                
Raymond James                                                               
RBC Wealth Management                                                       
Robert W. Baird                                                             
UBS Financial Services                                                      
Wells Fargo Advisors                                                        
Wells Fargo Investments                                                     

Although the Funds may use brokers and dealers that sell shares of the Funds to 
effect portfolio transactions, the Funds do not consider the sale of            
AllianceBernstein Mutual Fund shares as a factor when selecting brokers or      
dealers to effect portfolio transactions.                                       

HOW TO EXCHANGE SHARES                                                          
You may exchange your Fund shares for shares of the same class of other         
AllianceBernstein Mutual Funds (including AllianceBernstein Exchange Reserves,  
a money market fund managed by the Adviser) provided that the other fund offers 
the same class of shares. Exchanges of shares are made at the next-determined   
NAV, without sales or service charges, after your order is received in proper   
form. All exchanges are subject to the minimum investment restrictions set      
forth in the prospectus for the AllianceBernstein Mutual Fund whose shares are  
being acquired. Your exchange of shares is priced at the next-determined NAV    
after your order is received in proper form. You may request an exchange by     
mail or telephone. In order to receive a day's NAV, ABIS must receive and       
confirm your telephone exchange request by 4:00 p.m., Eastern time, on that     
day. The Funds may modify, restrict, or terminate the exchange privilege on 60  
days' written notice.                                                           

HOW TO SELL OR REDEEM SHARES                                                    
You may "redeem" your shares (i.e., sell your shares to a Fund) on any day the  
New York Stock Exchange, or Exchange, is open, either directly or through your  
financial intermediary. Your sale price will be the next-determined NAV, less   
any applicable CDSC, after the Fund receives your redemption request in proper  
form. Normally, redemption proceeds are sent to you within seven days. If you   
recently purchased your shares by check or electronic funds transfer, your      
redemption payment may be delayed until the Fund is reasonably satisfied that   
the check or electronic funds transfer has been collected (which may take up to 
15 days). For Advisor Class shares, if you are in doubt about what procedures   
or documents are required by your fee-based program or employee benefit plan to 
sell your shares, you should contact your financial advisor.                    

SELLING SHARES THROUGH YOUR BROKER OR OTHER FINANCIAL ADVISOR                   
Your broker or financial advisor must receive your sales request by 4:00 p.m.,  
Eastern time, and submit it to the Fund by a pre-arranged time for you to       
receive the next-determined NAV, less any applicable CDSC. Your broker or       
financial advisor is responsible for submitting all necessary documentation to  
the Fund and may charge you a fee for this service.                             

SELLING SHARES DIRECTLY TO THE FUND                                             
BY MAIL:                                                                        
..  Send a signed letter of instruction or stock power, along with certificates,
to:                                                                       

AllianceBernstein Investor Services, Inc.                   
P.O. Box 786003                                             
San Antonio, TX 78278-6003                                  

..  For certified or overnight deliveries, send to:                             

AllianceBernstein Investor Services, Inc.                   
8000 IH 10 W, 4th floor                                     
San Antonio, TX 78230                                       

..  For your protection, a bank, a member firm of a national stock exchange or  
another eligible guarantor institution must guarantee signatures. Stock   
power forms are available from your financial intermediary, ABIS, and many
commercial banks. Additional documentation is required for the sale of    
shares by corporations, intermediaries, fiduciaries, and surviving joint  
owners. If you have any questions about these procedures, contact ABIS.   

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BY TELEPHONE:                                                                   
..  You may redeem your shares for which no stock certificates have been issued 
  by telephone request. Call ABIS at 800-221-5672 with instructions on how you
wish to receive your sale proceeds.                                       

..  ABIS must receive and confirm a telephone redemption request by 4:00 p.m.,  
Eastern time, for you to receive that day's NAV, less any applicable CDSC.

..  For your protection, ABIS will request personal or other information from   
  you to verify your identity and will generally record the calls. Neither the
Fund nor the Adviser, ABIS, ABI or other Fund agent will be liable for any
loss, injury, damage or expense as a result of acting upon telephone      
instructions purporting to be on your behalf that ABIS reasonably believes
to be genuine.                                                            

..  If you have selected electronic funds transfer in your Mutual Fund          
Application, the redemption proceeds will be sent directly to your bank.  
Otherwise, the proceeds will be mailed to you.                            

..  Redemption requests by electronic funds transfer or check may not exceed    
$100,000 per Fund account per day.                                        

..  Telephone redemption is not available for shares held in nominee or "street 
name" accounts, retirement plan accounts, or shares held by a shareholder 
  who has changed his or her address of record within the previous 30 calendar
days.                                                                     

FREQUENT PURCHASES AND REDEMPTIONS OF FUND SHARES                               
Each Fund's Board has adopted policies and procedures designed to detect and    
deter frequent purchases and redemptions of Fund shares or excessive or         
short-term trading that may disadvantage long-term Fund shareholders. These     
policies are described below. There is no guarantee that the Funds will be able 
to detect excessive or short-term trading and to identify shareholders engaged  
in such practices, particularly with respect to transactions in omnibus         
accounts. Shareholders should be aware that application of these policies may   
have adverse consequences, as described below, and avoid frequent trading in    
Fund shares through purchases, sales and exchanges of shares. Each Fund         
reserves the right to restrict, reject, or cancel, without any prior notice,    
any purchase or exchange order for any reason, including any purchase or        
exchange order accepted by any shareholder's financial intermediary.            

RISKS ASSOCIATED WITH EXCESSIVE OR SHORT-TERM TRADING GENERALLY. While the      
Funds will try to prevent market timing by utilizing the procedures described   
below, these procedures may not be successful in identifying or stopping        
excessive or short-term trading in all circumstances. By realizing profits      
through short-term trading, shareholders that engage in rapid purchases and     
sales or exchanges of a Fund's shares dilute the value of shares held by        
long-term shareholders. Volatility resulting from excessive purchases and sales 
or exchanges of Fund shares, especially involving large dollar amounts, may     
disrupt efficient portfolio management and cause a Fund to sell shares at       
inopportune times to accommodate redemptions relating to short-term trading. In 
particular, a Fund may have difficulty implementing its long-term investment    
strategies if it is forced to maintain a higher level of its assets in cash to  
accommodate significant short-term trading activity. In addition, a Fund may    
incur increased administrative and other expenses due to excessive or           
short-term trading, including increased brokerage costs and realization of      
taxable capital gains.                                                          

Funds that may invest significantly in foreign securities may be particularly   
susceptible to short-term trading strategies. This is because foreign           
securities are typically traded on markets that close well before the time a    
Fund calculates its NAV at 4:00 p.m., Eastern time, which gives rise to the     
possibility that developments may have occurred in the interim that would       
affect the value of these securities. The time zone differences among           
international stock markets can allow a shareholder engaging in a short-term    
trading strategy to exploit differences in Fund share prices that are based on  
closing prices of foreign securities established some time before the Fund      
calculates its own share price (referred to as "time zone arbitrage"). The      
Funds have procedures, referred to as fair value pricing, designed to adjust    
closing market prices of foreign securities to reflect what is believed to be   
the fair value of those securities at the time a Fund calculates its NAV. While 
there is no assurance, the Funds expect that the use of fair value pricing, in  
addition to the short-term trading policies discussed below, will significantly 
reduce a shareholder's ability to engage in time zone arbitrage to the          
detriment of other Fund shareholders.                                           

A shareholder engaging in a short-term trading strategy may also target a Fund  
that does not invest primarily in foreign securities. Any Fund that invests in  
securities that are, among other things, thinly traded, traded infrequently or  
relatively illiquid has the risk that the current market price for the          
securities may not accurately reflect current market values. A shareholder may  
seek to engage in short-term trading to take advantage of these pricing         
differences (referred to as "price arbitrage"). All Funds may be adversely      
affected by price arbitrage.                                                    

POLICY REGARDING SHORT-TERM TRADING. Purchases and exchanges of shares of the   
Funds should be made for investment purposes only. The Funds will seek to       
prevent patterns of excessive purchases and sales of Fund shares to the extent  
they are detected by the procedures described below. The Funds reserve the      
right to modify this policy, including any surveillance or account blocking     
procedures established from time to time to effectuate this policy, at any time 
without notice.                                                                 

..  TRANSACTION SURVEILLANCE PROCEDURES. The Funds, through their agents, ABI   
  and ABIS, maintain surveillance procedures to detect excessive or short-term
 trading in Fund shares. This surveillance process involves several factors,
which include scrutinizing transactions in Fund shares that exceed certain
monetary thresholds or numerical limits within a specified period of time.
Generally, more than two exchanges of Fund shares during any 90-day period
or purchases of shares followed by a sale within 90 days will be          

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  identified by these surveillance procedures. For purposes of these transaction
surveillance procedures, the Funds may consider trading activity in multiple
accounts under common ownership, control, or influence. Trading activity    
identified by either, or a combination, of these factors, or as a result of 
any other information available at the time, will be evaluated to determine 
 whether such activity might constitute excessive or short-term trading. These
surveillance procedures may be modified from time to time, as necessary or  
 appropriate to improve the detection of excessive or short-term trading or to
address specific circumstances.                                             

..  ACCOUNT BLOCKING PROCEDURES. If the Funds determine, in their sole          
discretion, that a particular transaction or pattern of transactions      
identified by the transaction surveillance procedures described above is  
  excessive or short-term trading in nature, the relevant Fund account(s) will
  be immediately "blocked" and no future purchase or exchange activity will be
 permitted. However, sales of Fund shares back to a Fund or redemptions will
 continue to be permitted in accordance with the terms of the Fund's current
Prospectus. As a result, unless the shareholder redeems his or her shares,
 which may have consequences if the shares have declined in value, a CDSC is
applicable or adverse tax consequences may result, the shareholder may be 
 "locked" into an unsuitable investment. In the event an account is blocked,
certain account-related privileges, such as the ability to place purchase,
sale and exchange orders over the internet or by phone, may also be       
 suspended. A blocked account will generally remain blocked unless and until
the account holder or the associated broker, dealer or other financial    
 intermediary provides evidence or assurance acceptable to the Fund that the
account holder did not or will not in the future engage in excessive or   
short-term trading.                                                       

..  APPLICATIONS OF SURVEILLANCE PROCEDURES AND RESTRICTIONS TO OMNIBUS         
  ACCOUNTS. Omnibus account arrangements are common forms of holding shares of
the Funds, particularly among certain brokers, dealers and other financial
intermediaries, including sponsors of retirement plans and variable       
insurance products. The Funds apply their surveillance procedures to these
omnibus account arrangements. As required by Commission rules, the Funds  
  have entered into agreements with all of their financial intermediaries that
 require the financial intermediaries to provide the Funds, upon the request
of the Funds or their agents, with individual account level information   
about their transactions. If the Funds detect excessive trading through   
their monitoring of omnibus accounts, including trading at the individual 
account level, the financial intermediaries will also execute instructions
from the Funds to take actions to curtail the activity, which may include 
applying blocks to accounts to prohibit future purchases and exchanges of 
Fund shares. For certain retirement plan accounts, the Funds may request  
that the retirement plan or other intermediary revoke the relevant        
participant's privilege to effect transactions in Fund shares via the     
internet or telephone, in which case the relevant participant must submit 
 future transaction orders via the U.S. Postal Service (i.e., regular mail).

HOW THE FUNDS VALUE THEIR SHARES                                                
Each Fund's NAV is calculated at the close of regular trading on the Exchange   
(ordinarily, 4:00 p.m., Eastern time), only on days when the Exchange is open   
for business. To calculate NAV, a Fund's assets are valued and totaled,         
liabilities are subtracted, and the balance, called net assets, is divided by   
the number of shares outstanding. If a Fund invests in securities that are      
primarily traded on foreign exchanges that trade on weekends or other days when 
the Fund does not price its shares, the NAV of the Fund's shares may change on  
days when shareholders will not be able to purchase or redeem their shares in   
the Fund.                                                                       

The Funds value their securities at their current market value determined on    
the basis of market quotations or, if market quotations are not readily         
available or are unreliable, at "fair value" as determined in accordance with   
procedures established by and under the general supervision of each Fund's      
Board. When a Fund uses fair value pricing, it may take into account any        
factors it deems appropriate. A Fund may determine fair value based upon        
developments related to a specific security, current valuations of foreign      
stock indices (as reflected in U.S. futures markets) and/or U.S. sector or      
broader stock market indices. The prices of securities used by the Fund to      
calculate its NAV may differ from quoted or published prices for the same       
securities. Fair value pricing involves subjective judgments and it is possible 
that the fair value determined for a security is materially different than the  
value that could be realized upon the sale of that security.                    

Funds expect to use fair value pricing for securities primarily traded on U.S.  
exchanges only under very limited circumstances, such as the early closing of   
the exchange on which a security is traded or suspension of trading in the      
security. Funds may use fair value pricing more frequently for securities       
primarily traded in non-U.S. markets because, among other things, most foreign  
markets close well before a Fund values its securities at 4:00 p.m., Eastern    
time. The earlier close of these foreign markets gives rise to the possibility  
that significant events, including broad market moves, may have occurred in the 
interim. For example, the Funds believe that foreign security values may be     
affected by events that occur after the close of foreign securities markets. To 
account for this, the Funds may frequently value many of their foreign equity   
securities using fair value prices based on third party vendor modeling tools   
to the extent available.                                                        

Subject to its oversight, each Fund's Board has delegated responsibility for    
valuing a Fund's assets to the Adviser. The Adviser has established a Valuation 
Committee, which operates under the policies and procedures approved by the     
Board, to value the Fund's assets on behalf of the Fund. The Valuation          
Committee values Fund assets as described above.                                

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MANAGEMENT OF THE FUNDS                                                         
--------------------------------------------------------------------------------

INVESTMENT ADVISER                                                              
Each Fund's adviser is AllianceBernstein L.P., 1345 Avenue of the Americas, New 
York, New York 10105. The Adviser is a leading international investment adviser 
supervising client accounts with assets as of September 30, 2010, totaling      
approximately $484 billion (of which more than $81 billion represented assets   
of investment companies). As of September 30, 2010, the Adviser managed         
retirement assets for many of the largest public and private employee benefit   
plans (including 33 of the nation's FORTUNE 100 companies), for public employee 
retirement funds in 38 states, for investment companies, and for foundations,   
endowments, banks and insurance companies worldwide. Currently, the 35          
registered investment companies managed by the Adviser, comprising 115 separate 
investment portfolios, have approximately 3.2 million accounts.                 

The Adviser provides investment advisory services and order placement           
facilities for each of the Funds. For these advisory services, each Fund paid   
the Adviser during its most recent fiscal year a management fee as a percentage 
of average daily net assets as follows:                                         

                                                                [Download Table]

                                     FEE AS A PERCENTAGE OF            
                                       AVERAGE DAILY NET    FISCAL YEAR
FUND                                         ASSETS            ENDED   
-----------------------------------------------------------------------
                                                                       
AllianceBernstein Short Duration              .45%            9/30/10  
AllianceBernstein Intermediate Bond           .25%*          10/31/10  
AllianceBernstein Global Bond                 .45%*           9/30/10  
AllianceBernstein Diversified Yield           .00%*          10/31/10  
AllianceBernstein High Income                 .45%*          10/31/10  

*Fee stated net of any waivers and/or reimbursements. See "Fees and Expenses of 
the Fund" in the Summary Information at the beginning of the Prospectus for   
more information about fee waivers.                                           

A discussion regarding the basis for the Board's approval of each Fund's        
investment advisory agreement is available in the Fund's semi-annual report to  
shareholders. The Adviser may act as an investment adviser to other persons,    
firms, or corporations, including investment companies, hedge funds, pension    
funds, and other institutional investors. The Adviser may receive management    
fees, including performance fees, that may be higher or lower than the advisory 
fees it receives from the Funds. Certain other clients of the Adviser may have  
investment objectives and policies similar to those of a Fund. The Adviser may, 
from time to time, make recommendations that result in the purchase or sale of  
a particular security by its other clients simultaneously with a Fund. If       
transactions on behalf of more than one client during the same period increase  
the demand for securities being purchased or the supply of securities being     
sold, there may be an adverse effect on price or quantity. It is the policy of  
the Adviser to allocate advisory recommendations and the placing of orders in a 
manner that is deemed equitable by the Adviser to the accounts involved,        
including a Fund. When two or more of the clients of the Adviser (including a   
Fund) are purchasing or selling the same security on a given day from the same  
broker-dealer, such transactions may be averaged as to price.                   

PORTFOLIO MANAGERS                                                              
The management of, and investment decisions for, the Funds' portfolios are made 
by certain Investment Policy Teams. Each Investment Policy Team relies heavily  
on the fundamental analysis and research of the Adviser's large internal        
research staff. No one person is principally responsible for coordinating each  
Fund's investments.                                                             

The following table lists the Investment Policy Teams, the person within each   
Investment Policy Team with the most significant responsibility for day-to-day  
management of each Fund's portfolio, the length of time that each person has    
been jointly and primarily responsible for the Fund, and each person's          
principal occupation during the past five years:                                

                                                        [Enlarge/Download Table]

                                                                     PRINCIPAL OCCUPATION(S)                  
FUND AND RESPONSIBLE TEAM  EMPLOYEE; YEAR; TITLE                  DURING THE PAST FIVE (5) YEARS              
--------------------------------------------------------------------------------------------------------------
                                                                                                              
AllianceBernstein Short   Jon P. Denfeld; since     Vice President of the Adviser, with which he has been     
Duration Portfolio        2008; Vice President of   associated in a substantially similar capacity to his     
U.S. Investment Grade:    the Adviser               current position since May 2008. Prior thereto, he was    
Liquid Markets/Structured                           a Senior U.S. Portfolio Manager for UBS Global Asset      
Products Investment Team                            Management from 2006 to 2007. Prior thereto, he           
                                                    served as a Portfolio Manager for Shay Asset              
                                                    Management since prior to 2006.                           

                          Shawn E. Keegan; since    Vice President of the Adviser, with which he has been     
                          2005; Vice President of   associated in a substantially similar capacity to his     
                          the Adviser               current position since prior to 2006.                     

                          Alison M. Martier; since  Senior Vice President of the Adviser, with which she      
                          2009; Senior Vice         has been associated in a substantially similar capacity   
                          President of the Adviser  to her current position since prior to 2006.              
                          and Director of the                                                                 
                          Fixed Income Senior                                                                 
                          Portfolio Management Team                                                           

                          Douglas J. Peebles;       Senior Vice President of the Adviser, with which he has   
                          since 2009; Senior Vice   been associated in a substantially similar capacity to his
                          President of the          current position since prior to 2006.                     
                          Adviser, and Chief                                                                  
                          Investment Officer and                                                              
                          Head of Fixed Income                                                                

                          Greg J. Wilensky; since   Senior Vice President of the Adviser, with which he has   
                          2009; Senior Vice         been associated in a substantially similar capacity to his
                          President of the Adviser  current position since prior to 2006.                     
                          and Director of Stable                                                              
                          Value Investments                                                                   


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                                                        [Enlarge/Download Table]

                                                                   PRINCIPAL OCCUPATION(S)                 
FUND AND RESPONSIBLE TEAM  EMPLOYEE; YEAR; TITLE                DURING THE PAST FIVE (5) YEARS             
-----------------------------------------------------------------------------------------------------------
                                                                                                           
AllianceBernstein         Paul J. DeNoon; since     Senior Vice President of the Adviser, with which he has
Intermediate Bond         2009; Senior Vice         been associated in a substantially similar capacity to 
Portfolio                 President of the Adviser  his current position since prior to 2006.              
U.S. Investment Grade     and Director of Emerging                                                         
Core Fixed Income Team    Market Debt                                                                      

                          Shawn E. Keegan; since    (see above)                                            
                          2005; (see above)                                                                

                          Alison M. Martier; since  (see above)                                            
                          2005; (see above)                                                                

                          Douglas J. Peebles;       (see above)                                            
                          since 2007; (see above)                                                          

                          Greg J. Wilensky; since   (see above)                                            
                          2005; (see above)                                                                

AllianceBernstein Global  Paul J. DeNoon; since     (see above)                                            
Bond Fund                 2002; (see above)                                                                
Global Fixed Income                                                                                        
Investment Team                                                                                            
                          Scott DiMaggio; since     Senior Vice President of the Adviser, with which he has
                          2005; Senior Vice         been associated in a substantially similar capacity to 
                          President of the Adviser  his current position since prior to 2006.              
                          and Director of Canada                                                           
                          Fixed Income                                                                     

                          Michael L. Mon; since     Vice President of the Adviser, with which he has been  
                          2003; Vice President of   associated in a substantially similar capacity to his  
                          the Adviser               current position since prior to 2006.                  

                          Douglas J. Peebles;       (see above)                                            
                          since 1992; (see above)                                                          

                          Matthew S. Sheridan;      Vice President of the Adviser, with which he has been  
                          since 2007; Vice          associated in a substantially similar capacity to his  
                          President of the Adviser  current position since prior to 2006.                  

AllianceBernstein         Paul J. DeNoon; since     (see above)                                            
Diversified Yield Fund    2005; (see above)                                                                
Global Fixed Income                                                                                        
Investment Team and                                                                                        
Global Credit                                                                                              
Investment Team                                                                                            
                          Joran Laird; since 2009;  Vice President of the Adviser, with which he has been  
                          Vice President of the     associated in a substantially similar capacity to his  
                          Adviser                   current position since prior to 2006.                  

                          Douglas J. Peebles;       (see above)                                            
                          since 1996; (see above)                                                          

                          Matthew S. Sheridan;      (see above)                                            
                          since 2006; (see above)                                                          

                          Greg J. Wilensky; since   (see above)                                            
                          2008; (see above)                                                                

AllianceBernstein High    Paul J. DeNoon; since     (see above)                                            
Income Fund               2002; (see above)                                                                
Global Fixed Income Team                                                                                   
and Global Credit                                                                                          
Investment                                                                                                 
Team                                                                                                       
                          Gershon M. Distenfeld;    Senior Vice President of the Adviser, with which he has
                          since 2008; Senior Vice   been associated in a substantially similar capacity to 
                          President of the Adviser  his current position since prior to 2006.              

                          Douglas J. Peebles;       (see above)                                            
                          since 2002; (see above)                                                          

                          Marco Santamaria; since   Vice President of the Adviser, with which he has been  
                          2010; Vice President of   associated in a substantially similar capacity to his  
                          the Adviser               current position since June 2010. Prior thereto, he was
                                                    a founding partner at Global Securities Advisors, an   
                                                    emerging-market-oriented fixed-income hedge fund       
                                                    since prior to 2006.                                   

                          Matthew S. Sheridan;      (see above)                                            
                          since 2005; (see above)                                                          


Additional information about the portfolio managers may be found in the Funds'  
SAIs.                                                                           

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PERFORMANCE OF A SIMILARLY MANAGED PORTFOLIO                                    
The investment teams employed by the Adviser to manage ALLIANCEBERNSTEIN HIGH   
INCOME FUND and ALLIANCEBERNSTEIN INTERMEDIATE BOND PORTFOLIO have substantial  
experience in managing discretionary accounts of institutional clients, pooled  
investment vehicles and/or other registered investment companies and portions   
thereof (the "Historical Accounts") that have substantially the same investment 
objectives and policies and are managed in accordance with essentially the same 
investment strategies as the Funds. The Historical Accounts that are not        
registered investment companies are not subject to certain limitations,         
diversification requirements and other restrictions imposed under the 1940 Act  
and the Internal Revenue Code (the "Code") to which the Funds, as registered    
investment companies, are subject and which, if applicable to the Historical    
Accounts, may have adversely affected the performance of the Historical         
Accounts. With respect to ALLIANCEBERNSTEIN HIGH INCOME FUND, the Historical    
Accounts' performance information is representative solely of the performance   
of a pooled investment vehicle that is not offered for sale in the United       
States.                                                                         

Set forth below is performance data provided by the Adviser relating to the     
Historical Accounts managed by the investment team that manages each Fund's     
assets. Performance data is shown for the period during which the investment    
team of the Adviser managed the Historical Accounts through December 31, 2010.  
The aggregate assets for the Historical Accounts managed by the High Income     
investment team and the Intermediate Bond investment team as of                 
September 30, 2010 were approximately $26.6 billion and $15.6 billion,          
respectively. The investment teams' Historical Accounts have a nearly identical 
composition of representative investment holdings and related percentage        
weightings. The performance data is net of all fees (including any portfolio    
transaction costs) charged to the Historical Accounts, calculated on a monthly  
basis. The highest fee payable for the Historical Accounts is 2.04% of assets   
for ALLIANCEBERNSTEIN HIGH INCOME FUND and .91% of assets for ALLIANCEBERNSTEIN 
INTERMEDIATE BOND PORTFOLIO, annually. Net-of-fee performance figures reflect   
the compounding effect of such fees.                                            

The data has not been adjusted to reflect any fees that will be payable by the  
Funds, which may be higher than the fees imposed on the Historical Accounts,    
and will reduce the returns of the Funds. Expenses associated with the          
distribution of Class A, Class B and Class C shares of the Funds in accordance  
with the plans adopted by the Boards of the Funds under Commission Rule 12b-1   
are also excluded. Except as noted, the performance data has also not been      
adjusted for corporate or individual taxes, if any, payable by account owners.  

The Adviser has calculated the investment performance of the Historical         
Accounts on a trade-date basis. Income has been accrued daily and cash flows    
weighted daily. Composite investment performance for the Funds has been         
determined on an asset weighted basis. New accounts are included in the         
composite investment performance computations at the beginning of the quarter   
following the initial contribution. The total returns set forth below are       
calculated using a method that links the monthly return amounts for the         
disclosed periods, resulting in a time-weighted rate of return. Other methods   
of computing the investment performance of the Historical Accounts may produce  
different results, and the results for different periods may vary.              

A composite benchmark, comprised of the JPMorgan Emerging Markets Bond Index    
Global ("EMBI Global"), the JPMorgan Government Bond Index-Emerging Markets     
("GBI-EM") and the Barclays Capital High Yield Index (2% Constrained) ("BC High 
Yield") on an equal weighted basis (the "High Income Composite Benchmark") is   
used by ALLIANCEBERNSTEIN HIGH INCOME FUND and its Historical Account, for      
purposes of this example, as a benchmark to measure its relative performance.   
EMBI Global tracks total returns for traded external debt instruments in the    
emerging markets, GBI-EM tracks total returns for local currency government     
bonds issued by emerging markets, and BC High Yield tracks the                  
U.S. Dollar-denominated, non-investment grade, fixed-rate, taxable corporate    
bond market.                                                                    

The Barclays Capital Aggregate Index ("BC Aggregate Index") is used by          
ALLIANCEBERNSTEIN INTERMEDIATE BOND PORTFOLIO as a benchmark to measure its     
relative performance and is composed of securities from Barclays Capital        
Government/Corporate Bond Index, Mortgage-Backed Securities Index, and the      
Asset-Backed Securities Index. The index's total return consists of price       
appreciation/depreciation plus income as a percentage of the original           
investment. Indices are rebalanced monthly by market capitalization.            

To the extent the investment teams utilize investment techniques such as swaps, 
futures or options, the performance of the High Income Composite Benchmark and  
the BC Aggregate Index may not be substantially comparable to the performance   
of the investment teams' Historical Accounts. The High Income Composite         
Benchmark and the BC Aggregate Index do not reflect the deduction of any fees   
or expenses associated with the active management of a mutual fund.             

The performance data below is provided solely to illustrate the investment      
teams' performance in managing the Historical Accounts as measured against a    
broad based market index. The performance of the Funds will be affected by the  
performance of the investment team managing the Funds' assets. If the           
investment team were to perform relatively poorly, the performance of the Funds 
would suffer. Investors should not rely on the performance data of the          
Historical Accounts as an indication of future performance of the Funds.        

The investment performance for the periods presented may not be indicative of   
future rates of return. The performance was not calculated pursuant to the      
methodology established by the Commission that will be used to calculate the    
Funds' performance. The use of methodology different from that used to          
calculate performance could result in different performance data.               

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SCHEDULE OF HISTORICAL PERFORMANCE - HISTORICAL ACCOUNTS*                       

                                                        [Enlarge/Download Table]

                                  HIGH INCOME     HIGH INCOME                                     
                               HISTORICAL ACCOUNT  COMPOSITE                           BC HIGH    
                                 TOTAL RETURN**    BENCHMARK  EMBI GLOBAL*** GBI-EM YIELD INDEX***
--------------------------------------------------------------------------------------------------
                                                                                                  
Year Ended December 31:                                                                           
2010                                  15.62%         14.01%        12.04%    13.08%      14.94%   
2009                                  60.62%         33.73%        28.18%    16.56%      58.76%   
2008                                 -32.27%        -14.79%       -10.91%    -6.93%     -25.88%   
2007                                   5.91%          8.19%         6.28%    16.28%       2.26%   
2006                                  12.56%         10.97%         9.88%    11.96%      10.76%   
2005                                   7.99%          5.46%        10.73%     2.87%       2.76%   
2004                                  11.11%         15.36%        11.73%    23.12%      11.14%   
2003                                  36.36%         24.06%        25.66%    17.79%      28.78%   
2002                                   5.26%         13.66%        13.11%    29.11%       -.24%   
2001                                 -10.44%           N/A          1.36%      N/A        5.46%   
2000                                  -4.25%           N/A         14.41%      N/A       -5.79%   
1999                                  18.76%           N/A         24.18%      N/A        2.39%   
1998                                 -15.60%           N/A        -11.54%      N/A        1.87%   
Cumulative total return for                                                                       
 the period September 22,                                                                         
 1997 (inception of                                                                               
 Historical Account) to                                                                           
 December 31, 2010                   121.73%           N/A        234.63%***   N/A      132.90%***
--------------------------------------------------------------------------------------------------

*  Total return is a measure of investment performance that is based upon the   
change in value of an investment from the beginning to the end of a       
specified period and assumes reinvestment of all dividends and other      
distributions. The basis of presentation of this data is described in the 
preceding discussion.                                                     

** Net of all fees.                                                             

***Net inception cumulative index returns are from December 31, 1997.           

                                                        [Enlarge/Download Table]

                                                                             INTERMEDIATE BOND   BC U.S. 
                                                                            HISTORICAL ACCOUNTS AGGREGATE
                                                                              TOTAL RETURN**      INDEX  
---------------------------------------------------------------------------------------------------------
                                                                                                         
Year Ended December 31:                                                                                  
2010                                                                                9.45%          6.54% 
2009                                                                               18.77%          5.93% 
2008                                                                               -5.41%          5.24% 
2007                                                                                5.60%          6.97% 
2006                                                                                5.26%          4.33% 
2005                                                                                3.22%          2.43% 
2004                                                                                5.48%          4.34% 
2003                                                                                8.45%          4.10% 
2002                                                                                7.93%         10.26% 
Cumulative total return for the period June 30, 2001 (inception of                                       
 Historical Accounts) to December 31, 2010                                         81.89%         70.18% 
---------------------------------------------------------------------------------------------------------

*  Total return is a measure of investment performance that is based upon the   
change in value of an investment from the beginning to the end of a       
specified period and assumes reinvestment of all dividends and other      
distributions. The basis of presentation of this data is described in the 
preceding discussion.                                                     

** Net of all fees.                                                             

AVERAGE ANNUAL TOTAL RETURNS AS OF DECEMBER 31, 2010                            

                                                                [Download Table]

                                                                   SINCE  
                                 1 YEAR 3 YEARS 5 YEARS 10 YEARS INCEPTION
--------------------------------------------------------------------------
                                                                          
High Income Historical Account   15.62%   7.94%  8.44%    8.75%    6.18%* 
High Income Composite Benchmark  14.01%   9.12%  9.30%     N/A      N/A   
   EMBI Global                   12.04%   8.56%  8.36%   10.29%    9.74%**
   GBI-EM                        13.08%   7.06%  9.82%     N/A      N/A   
   BC High Yield                 14.94%  10.59%  8.91%    9.01%    6.72%**
--------------------------------------------------------------------------

* Inception date of Historical Account is September 22, 1997.                   

**Since inception average annual total returns are from December 31, 1997.      

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                                                                [Download Table]

                                                                SINCE  
                                       1 YEAR 3 YEARS 5 YEARS INCEPTION
-----------------------------------------------------------------------
                                                                       
Intermediate Bond Historical Accounts   9.45%  7.13%   6.45%    6.50%* 
BC U.S. Aggregate Index                 6.54%  5.90%   5.80%    5.76%* 
-----------------------------------------------------------------------

* Inception date of Historical Accounts is June 30, 2001.                       

TRANSFER AGENCY AND RETIREMENT PLAN SERVICES                                    
ABIS acts as the transfer agent for the Funds. ABIS, an indirect wholly-owned   
subsidiary of the Adviser, registers the transfer, issuance, and redemption of  
Fund shares and disburses dividends and other distributions to Fund             
shareholders.                                                                   

Many Fund shares are owned by financial intermediaries for the benefit of their 
customers. Retirement plans may also hold Fund shares in the name of the plan,  
rather than the participant. In those cases, the Funds often do not maintain an 
account for you. Thus, some or all of the transfer agency functions for these   
and certain other accounts are performed by the financial intermediaries and    
plan recordkeepers. The Funds, ABI and/or the Adviser pay to these financial    
intermediaries and recordkeepers, including those that sell shares of the       
AllianceBernstein Mutual Funds, fees for sub-transfer agency and recordkeeping  
services in amounts ranging up to $19 per customer fund account per annum       
and/or up to 0.25% per annum of the average daily assets held through the       
intermediary. To the extent any of these payments for recordkeeping services or 
transfer agency services are made by the Funds, they are included in the amount 
appearing opposite the caption "Other Expenses" found in the Fund expense       
tables under "Fees and Expenses of the Fund" in the Summary Information at the  
beginning of the Prospectus. In addition, financial intermediaries may be       
affiliates of entities that receive compensation from the Adviser or ABI for    
maintaining retirement plan "platforms" that facilitate trading by affiliated   
and non-affiliated financial intermediaries and recordkeeping for retirement    
plans.                                                                          

Because financial intermediaries and plan recordkeepers may be paid varying     
amounts per class for sub-transfer agency and recordkeeping services, the       
service requirements of which may also vary by class, this may create an        
additional incentive for financial intermediaries and their financial advisors  
to favor one fund complex over another or one class of shares over another.     

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DIVIDENDS, DISTRIBUTIONS AND TAXES                                              
--------------------------------------------------------------------------------

Each Fund's income dividends and capital gains distributions, if any, declared  
by a Fund on its outstanding shares will, at the election of each shareholder,  
be paid in cash or in additional shares of the same class of shares of that     
Fund. If paid in additional shares, the shares will have an aggregate NAV as of 
the close of business on the declaration date of the dividend or distribution   
equal to the cash amount of the dividend or distribution. You may make an       
election to receive dividends and distributions in cash or in shares at the     
time you purchase shares. Your election can be changed at any time prior to a   
record date for a dividend. There is no sales or other charge in connection     
with the reinvestment of dividends or capital gains distributions. Cash         
dividends may be paid by check, or, at your election, electronically via the    
ACH network.                                                                    

If you receive an income dividend or capital gains distribution in cash you     
may, within 120 days following the date of its payment, reinvest the dividend   
or distribution in additional shares of that Fund without charge by returning   
to the Adviser, with appropriate instructions, the check representing the       
dividend or distribution. Thereafter, unless you otherwise specify, you will be 
deemed to have elected to reinvest all subsequent dividends and distributions   
in shares of that Fund.                                                         

While it is the intention of each Fund to distribute to its shareholders        
substantially all of each fiscal year's net income and net realized capital     
gains, if any, the amount and timing of any dividend or distribution will       
depend on the realization by the Fund of income and capital gains from          
investments. There is no fixed dividend rate and there can be no assurance that 
a Fund will pay any dividends or realize any capital gains. The final           
determination of the amount of a Fund's return of capital distributions for the 
period will be made after the end of each calendar year.                        

You will normally have to pay federal income tax, and any state or local income 
taxes, on the distributions you receive from a Fund, whether you take the       
distributions in cash or reinvest them in additional shares. Distributions of   
net capital gains from the sale of investments that a Fund owned for more than  
one year and that are properly designated as capital gain dividends are taxable 
as long-term capital gains. For taxable years beginning on or before            
December 31, 2012, distributions of dividends to a Fund's non-corporate         
shareholders may be treated as "qualified dividend income," which is taxed at   
reduced rates, if such distributions are derived from, and designated by a Fund 
as, "qualified dividend income" and provided that holding period and other      
requirements are met by both the shareholder and the Fund. "Qualified dividend  
income" generally is income derived from dividends from U.S. corporations and   
"qualified foreign corporations." Other distributions by a Fund are generally   
taxable to you as ordinary income. Dividends declared in October, November, or  
December and paid in January of the following year are taxable as if they had   
been paid the previous December. A Fund will notify you as to how much of the   
Fund's distributions, if any, qualify for these reduced tax rates.              

Investment income received by a Fund from sources within foreign countries may  
be subject to foreign income taxes withheld at the source. To the extent that   
any Fund is liable for foreign income taxes withheld at the source, the Fund    
intends, if possible, to operate so as to meet the requirements of the Code to  
"pass through" to the Fund's shareholders credits for foreign income taxes paid 
(or to permit shareholders to claim a deduction for such foreign taxes), but    
there can be no assurance that any Fund will be able to do so, and Funds that   
invest primarily in U.S. securities will not do so. Furthermore, a              
shareholder's ability to claim a foreign tax credit or deduction for foreign    
taxes paid by a Fund may be subject to certain limitations imposed by the Code, 
as a result of which a shareholder may not be permitted to claim a credit or    
deduction for all or a portion of the amount of such taxes.                     

Under certain circumstances, if a Fund realizes losses (e.g., from fluctuations 
in currency exchange rates) after paying a dividend, all or a portion of the    
dividend may subsequently be characterized as a return of capital. Returns of   
capital are generally nontaxable, but will reduce a shareholder's basis in      
shares of the Fund. If that basis is reduced to zero (which could happen if the 
shareholder does not reinvest distributions and returns of capital are          
significant), any further returns of capital will be taxable as a capital gain. 

If you buy shares just before a Fund deducts a distribution from its NAV, you   
will pay the full price for the shares and then receive a portion of the price  
back as a taxable distribution.                                                 

The sale or exchange of Fund shares is a taxable transaction for federal income 
tax purposes.                                                                   

Each year shortly after December 31, each Fund will send you tax information    
stating the amount and type of all its distributions for the year. You are      
encouraged to consult your tax adviser about the federal, state, and local tax  
consequences in your particular circumstances, as well as about any possible    
foreign tax consequences.                                                       

NON-U.S. SHAREHOLDERS                                                           
If you are a nonresident alien individual or a foreign corporation for federal  
income tax purposes, please see the Funds' SAIs for information on how you will 
be taxed as a result of holding shares in the Funds.                            

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GENERAL INFORMATION                                                             
--------------------------------------------------------------------------------

Under unusual circumstances, a Fund may suspend redemptions or postpone payment 
for up to seven days or longer, as permitted by federal securities law. The     
Funds reserve the right to close an account that has remained below $1,000 for  
90 days.                                                                        

During drastic economic or market developments, you might have difficulty in    
reaching ABIS by telephone, in which event you should issue written             
instructions to ABIS. ABIS is not responsible for the authenticity of telephone 
requests to purchase, sell, or exchange shares. ABIS will employ reasonable     
procedures to verify that telephone requests are genuine, and could be liable   
for losses resulting from unauthorized transactions if it failed to do so.      
Dealers and agents may charge a commission for handling telephone requests. The 
telephone service may be suspended or terminated at any time without notice.    

Shareholder Services. ABIS offers a variety of shareholder services. For more   
information about these services or your account, call ABIS's toll-free number, 
800-221-5672. Some services are described in the Mutual Fund Application.       

Householding. Many shareholders of the AllianceBernstein Mutual Funds have      
family members living in the same home who also own shares of the same Funds.   
In order to reduce the amount of duplicative mail that is sent to homes with    
more than one Fund account and to reduce expenses of the Funds, all             
AllianceBernstein Mutual Funds will, until notified otherwise, send only one    
copy of each prospectus, shareholder report and proxy statement to each         
household address. This process, known as "householding", does not apply to     
account statements, confirmations, or personal tax information. If you do not   
wish to participate in householding, or wish to discontinue householding at any 
time, call ABIS at 800-221-5672. We will resume separate mailings for your      
account within 30 days of your request.                                         

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GLOSSARY OF INVESTMENT TERMS                                                    
--------------------------------------------------------------------------------

BONDS are interest-bearing or discounted government or corporate securities     
that obligate the issuer to pay the bond holder a specified sum of money,       
usually at specified intervals, and to repay the principal amount of the loan   
at maturity.                                                                    

FIXED-INCOME SECURITIES are investments, such as bonds, that pay a fixed rate   
of return.                                                                      

NON-U.S. COMPANY or NON-U.S. ISSUER is an entity that (i) is organized under    
the laws of a foreign country and conducts business in a foreign country,       
(ii) derives 50% or more of its total revenues from business in foreign         
countries, or (iii) issues equity or debt securities that are traded            
principally on a stock exchange in a foreign country.                           

SOVEREIGN DEBT OBLIGATIONS are foreign government debt securities, loan         
participations between foreign governments and financial institutions, and      
interests in entities organized and operated for the purpose of restructuring   
the investment characteristics of foreign government securities.                

SUPRANATIONAL ENTITIES are international organizations formed by two or more    
governments. Examples of supranational entities include the International Bank  
for Reconstruction and Development, the Inter-American Development Bank, the    
Asian Development Bank, the African Development Bank, the International Finance 
Corporation and the European Bank for Reconstruction and Development.           

U.S. GOVERNMENT SECURITIES are securities issued or guaranteed by the U.S.      
Government, its agencies or instrumentalities, including obligations that are   
issued by private issuers that are guaranteed as to principal or interest by    
the U.S. Government, its agencies or instrumentalities, or by certain           
government-sponsored entities (entities chartered by or sponsored by Act of     
Congress). These securities include securities backed by the full faith and     
credit of the United States, those supported by the right of the issuer to      
borrow from the U.S. Treasury, and those backed only by the credit of the       
issuing agency or entity itself. The first category includes U.S. Treasury      
securities (which are U.S. Treasury bills, notes, and bonds) and certificates   
issued by GNMA. U.S. Government securities not backed by the full faith and     
credit of the United States or a right to borrow from the U.S. Treasury include 
certificates issued by FNMA and FHLMC.                                          

THE BOFA MERRILL LYNCH 3-MONTH T-BILL INDEX is an unmanaged index that measures 
returns of three-month Treasury Bills.                                          

THE BOFA MERRILL LYNCH 1-3 YEAR TREASURY INDEX is an unmanaged index consisting 
of all public U.S. Treasury obligations having maturities from 1 to 2.99 years  
and reflects total return. This unmanaged index does not reflect fees and       
expenses and is not available for direct investment.                            

THE BARCLAYS CAPITAL U.S. AGGREGATE INDEX is a broad-based bond index comprised 
of government, corporate, mortgage and asset-backed issues, rated investment    
grade or higher, and having at least one year to maturity.                      

THE BARCLAYS CAPITAL GLOBAL AGGREGATE INDEX is a macro index of global          
government and corporate bond markets, and is composed of various indices       
calculated by Barclays Capital, including the U.S. Aggregate Index, the         
Pan-European Aggregate Index, the Global Treasury Index, the Asian-Pacific      
Aggregate Index, the Eurodollar Index and the U.S. Investment-Grade 144A Index. 

THE BARCLAYS CAPITAL HIGH YIELD INDEX is an unmanaged index generally           
representative of corporate bonds rated below investment grade.                 

THE JPMORGAN EMERGING MARKETS BOND INDEX GLOBAL is a broad-based, unmanaged     
index which tracks total return for external currency denominated debt in       
emerging markets.                                                               

THE JPMORGAN GOVERNMENT BOND INDEX-EMERGING MARKETS is a definitive local       
emerging markets debt benchmark that tracks local currency government bonds     
issued by emerging markets.                                                     

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FINANCIAL HIGHLIGHTS                                                            
--------------------------------------------------------------------------------

The financial highlights table is intended to help you understand each Fund's   
financial performance for the past five years. Certain information reflects     
financial results for a single share of a class of each Fund. The total returns 
in the table represent the rate that an investor would have earned (or lost) on 
an investment in the Fund (assuming reinvestment of all dividends and           
distributions). This information has been audited by Ernst & Young, LLP, the    
independent registered public accounting firm for all Funds, except             
ALLIANCEBERNSTEIN SHORT DURATION PORTFOLIO, whose independent registered public 
accounting firm is PricewaterhouseCoopers LLP, whose reports, along with each   
Fund's financial statements, are included in each Fund's Annual Report, which   
is available upon request.                                                      

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                                   INCOME FROM INVESTMENT OPERATIONS         LESS: DIVIDENDS AND DISTRIBUTIONS   
                               --------------------------------------     -------------------------------------- 
                                                            NET INCREASE                                         
                     NET ASSET                NET REALIZED   (DECREASE)   DIVIDENDS  DISTRIBUTIONS               
                      VALUE,      NET        AND UNREALIZED IN NET ASSET   FROM NET     FROM NET     TOTAL DIVI- 
FISCAL YEAR OR       BEGINNING INVESTMENT    GAIN (LOSS) ON  VALUE FROM   INVESTMENT REALIZED GAIN    DENDS AND  
PERIOD               OF PERIOD INCOME (a)     INVESTMENTS    OPERATIONS     INCOME   ON INVESTMENTS DISTRIBUTIONS
-----------------------------------------------------------------------------------------------------------------
                                                                                                                 
SHORT DURATION                                                                                                   
CLASS A                                                                                                          
Year Ended 9/30/10    $11.65      $.16           $  .30        $  .46       $(.19)       $0.00          $(.19)   
Year Ended 9/30/09     11.46       .31              .21           .52        (.33)        0.00           (.33)   
Year Ended 9/30/08     12.24       .43             (.77)         (.34)       (.44)        0.00           (.44)   
Year Ended 9/30/07     12.31       .51             (.05)          .46        (.53)        0.00           (.53)   
Year Ended 9/30/06     12.39       .45             (.06)          .39        (.47)        0.00           (.47)   

CLASS B                                                                                                          
Year Ended 9/30/10    $11.64      $.08           $  .30        $  .38       $(.10)       $0.00          $(.10)   
Year Ended 9/30/09     11.45       .23              .20           .43        (.24)        0.00           (.24)   
Year Ended 9/30/08     12.24       .34             (.77)         (.43)       (.36)        0.00           (.36)   
Year Ended 9/30/07     12.31       .43             (.06)          .37        (.44)        0.00           (.44)   
Year Ended 9/30/06     12.39       .36             (.05)          .31        (.39)        0.00           (.39)   

CLASS C                                                                                                          
Year Ended 9/30/10    $11.64      $.08           $  .30        $  .38       $(.10)       $0.00          $(.10)   
Year Ended 9/30/09     11.45       .24              .20           .44        (.25)        0.00           (.25)   
Year Ended 9/30/08     12.23       .34             (.76)         (.42)       (.36)        0.00           (.36)   
Year Ended 9/30/07     12.30       .43             (.06)          .37        (.44)        0.00           (.44)   
Year Ended 9/30/06     12.38       .36             (.05)          .31        (.39)        0.00           (.39)   

INTERMEDIATE BOND                                                                                                
CLASS A                                                                                                          
Year Ended 10/31/10   $10.28      $.42(e)        $  .70        $ 1.12       $(.42)       $0.00          $(.42)   
Year Ended 10/31/09     8.77       .44(e)          1.53          1.97        (.46)        0.00           (.46)   
Year Ended 10/31/08    10.24       .50(e)         (1.49)         (.99)(h)    (.48)        0.00           (.48)   
Year Ended 10/31/07    10.18       .42(e)           .06           .48        (.42)        0.00           (.42)   
Year Ended 10/31/06    10.15       .41(e)           .04           .45        (.42)        0.00           (.42)   

CLASS B                                                                                                          
Year Ended 10/31/10   $10.28      $.35(e)        $  .70        $ 1.05       $(.35)       $0.00          $(.35)   
Year Ended 10/31/09     8.77       .38(e)          1.52          1.90        (.39)        0.00           (.39)   
Year Ended 10/31/08    10.23       .42(e)         (1.47)        (1.05)(h)    (.41)        0.00           (.41)   
Year Ended 10/31/07    10.18       .35(e)(i)        .05           .40        (.35)        0.00           (.35)   
Year Ended 10/31/06    10.15       .38(e)(i)        .04           .42        (.39)        0.00           (.39)   

CLASS C                                                                                                          
Year Ended 10/31/10   $10.26      $.35(e)        $  .70        $ 1.05       $(.35)       $0.00          $(.35)   
Year Ended 10/31/09     8.75       .38(e)          1.52          1.90        (.39)        0.00           (.39)   
Year Ended 10/31/08    10.22       .43(e)         (1.49)        (1.06)(h)    (.41)        0.00           (.41)   
Year Ended 10/31/07    10.16       .35(e)           .06           .41        (.35)        0.00           (.35)   
Year Ended 10/31/06    10.13       .34(e)           .04           .38        (.35)        0.00           (.35)   

ADVISOR CLASS                                                                                                    
Year Ended 10/31/10   $10.28      $.44(e)        $  .73        $ 1.17       $(.46)       $0.00          $(.46)   
Year Ended 10/31/09     8.78       .47(e)          1.51          1.98        (.48)        0.00           (.48)   
Year Ended 10/31/08    10.24       .50(e)         (1.45)         (.95)(h)    (.51)        0.00           (.51)   
Year Ended 10/31/07    10.18       .45(e)           .06           .51        (.45)        0.00           (.45)   
Year Ended 10/31/06    10.15       .44(e)           .04           .48        (.45)        0.00           (.45)   
-----------------------------------------------------------------------------------------------------------------

Please refer to the footnotes on page 60.                                       

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                                           RATIOS/SUPPLEMENTAL DATA                   
                         ------------------------------------------------------------ 
              TOTAL                                        RATIO OF NET               
            INVESTMENT                      RATIO OF        INVESTMENT                
NET ASSET  RETURN BASED    NET ASSETS,      EXPENSES          INCOME         PORTFOLIO
VALUE, END ON NET ASSET   END OF PERIOD    TO AVERAGE       TO AVERAGE       TURNOVER 
OF PERIOD   VALUE (b)    (000'S OMITTED)   NET ASSETS       NET ASSETS         RATE   
--------------------------------------------------------------------------------------
                                                                                      
  $11.92        3.95%(c)    $ 65,233         .94%(c)           1.35%(c)         107%  
   11.65        4.61          53,643         .99               2.72             176   
   11.46       (2.83)(d)      33,197         .96               3.60             116   
   12.24        3.80          40,444         .98               4.21             127   
   12.31        3.23          37,595        1.03(c)            3.63(c)          157   

  $11.92        3.27%(d)    $  6,538        1.69%(c)            .72%(c)         107%  
   11.64        3.86           8,913        1.72               2.02             176   
   11.45       (3.59)(d)       9,125        1.66               2.91             116   
   12.24        3.09          10,791        1.68               3.48             127   
   12.31        2.55          16,899        1.73(c)            2.91(c)          157   

  $11.92        3.31%(d)    $ 27,105        1.65%(c)            .66%(c)         107%  
   11.64        3.88          25,193        1.70               2.04             176   
   11.45       (3.52)(d)      16,176        1.66               2.89             116   
   12.23        3.09          14,772        1.69               3.49             127   
   12.30        2.54          18,923        1.74(c)            2.93(c)          157   

  $10.98       11.17%(d)    $418,023         .91%(c)(f)(g)     3.98%(c)(e)       99%  
   10.28       23.01(d)      419,319         .89(f)(g)         4.71(e)           95   
    8.77      (10.15)(d)     360,606         .85(g)            4.68(e)          184   
   10.24        4.79(d)       41,696         .98(g)            4.13(e)          173   
   10.18        4.51          44,409         .98(c)(g)         4.08(c)(e)       446   

  $10.98       10.40%(d)    $ 16,048        1.62%(c)(f)(g)     3.35%(c)(e)       99%  
   10.28       22.17(d)       21,830        1.58(f)(g)         4.07(e)           95   
    8.77      (10.69)(d)      31,207        1.55(g)            3.95(e)          184   
   10.23        3.96(d)       20,157        1.66(g)            3.46(e)(i)       173   
   10.18        4.20          30,154        1.33(c)(g)         3.75(c)(e)(i)    446   

  $10.96       10.42%(d)    $ 66,568        1.61%(c)(f)(g)     3.27%(c)(e)       99%  
   10.26       22.22(d)       61,635        1.59(f)(g)         4.02(e)           95   
    8.75      (10.80)(d)      51,708        1.55(g)            3.99(e)          184   
   10.22        4.07(d)        9,404        1.68(g)            3.45(e)          173   
   10.16        3.80           9,874        1.68(c)(g)         3.40(c)(e)       446   

  $10.99       11.59%(d)    $ 89,981         .60%(c)(f)(g)     4.19%(c)(e)       99%  
   10.28       23.23(d)       62,369         .60(f)(g)         4.95(e)           95   
    8.78       (9.78)(d)      33,139         .55(g)            4.98(e)          184   
   10.24        5.11(d)       32,375         .68(g)            4.44(e)          173   
   10.18        4.83          29,966         .68(c)(g)         4.38(c)(e)       446   
--------------------------------------------------------------------------------------

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                                    INCOME FROM INVESTMENT OPERATIONS          LESS: DIVIDENDS AND DISTRIBUTIONS       
                                 -----------------------------------     --------------------------------------------- 
                                                           NET INCREASE                     DISTRIBUTIONS              
                       NET ASSET             NET REALIZED   (DECREASE)   DIVIDENDS    TAX     FROM NET                 
                        VALUE,      NET     AND UNREALIZED IN NET ASSET   FROM NET  RETURN  REALIZED GAIN  TOTAL DIVI- 
                       BEGINNING INVESTMENT GAIN (LOSS) ON  VALUE FROM   INVESTMENT   OF         ON         DENDS AND  
FISCAL YEAR OR PERIOD  OF PERIOD INCOME (a)  INVESTMENTS    OPERATIONS     INCOME   CAPITAL  INVESTMENTS  DISTRIBUTIONS
-----------------------------------------------------------------------------------------------------------------------
                                                                                                                       
GLOBAL BOND                                                                                                            
CLASS A                                                                                                                
Year Ended 9/30/10       $7.87      $.32(e)     $  .63        $  .95       $(.32)    $(.00)     $0.00         $(.32)   
Year Ended 9/30/09        7.39       .40(e)        .60          1.00        (.40)     (.00)      (.12)         (.52)   
Year Ended 9/30/08        8.07       .42(e)       (.70)         (.28)       (.40)     (.00)      0.00          (.40)   
Year Ended 9/30/07        7.54       .40           .52           .92        (.39)     (.00)      0.00          (.39)   
Year Ended 9/30/06        7.69       .44          (.15)          .29        (.44)     (.00)      0.00          (.44)   

CLASS B                                                                                                                
Year Ended 9/30/10       $7.88      $.27(e)     $  .63        $  .90       $(.27)    $(.00)     $0.00         $(.27)   
Year Ended 9/30/09        7.39       .35(e)        .61           .96        (.35)     (.00)      (.12)         (.47)   
Year Ended 9/30/08        8.07       .36(e)       (.70)         (.34)       (.34)     (.00)      0.00          (.34)   
Year Ended 9/30/07        7.54       .34           .52           .86        (.33)     (.00)      0.00          (.33)   
Year Ended 9/30/06        7.68       .38          (.14)          .24        (.38)     (.00)      0.00          (.38)   

CLASS C                                                                                                                
Year Ended 9/30/10       $7.90      $.27(e)     $  .63        $  .90       $(.27)    $(.00)     $0.00         $(.27)   
Year Ended 9/30/09        7.41       .35(e)        .61           .96        (.35)     (.00)      (.12)         (.47)   
Year Ended 9/30/08        8.09       .36(e)       (.70)         (.34)       (.34)     (.00)      0.00          (.34)   
Year Ended 9/30/07        7.56       .34           .52           .86        (.33)     (.00)      0.00          (.33)   
Year Ended 9/30/06        7.71       .38          (.15)          .23        (.38)     (.00)      0.00          (.38)   

ADVISOR CLASS                                                                                                          
Year Ended 9/30/10       $7.87      $.34(e)     $  .64        $  .98       $(.35)    $(.00)     $0.00         $(.35)   
Year Ended 9/30/09        7.38       .41(e)        .62          1.03        (.42)     (.00)      (.12)         (.54)   
11/5/07(j) to 9/30/08     8.14       .41(e)       (.78)         (.37)       (.39)     (.00)      0.00          (.39)   

DIVERSIFIED YIELD                                                                                                      
CLASS A                                                                                                                
Year Ended 10/31/10      $8.10      $.24(e)     $  .39        $  .63       $(.23)    $(.00)     $0.00         $(.23)   
Year Ended 10/31/09       7.39       .32(e)        .71          1.03        (.28)     (.04)      0.00          (.32)   
Year Ended 10/31/08       9.02       .36(e)      (1.63)        (1.27)(h)    (.36)     (.00)      0.00          (.36)   
Year Ended 10/31/07       8.62       .34           .40           .74        (.34)     (.00)      0.00          (.34)   
Year Ended 10/31/06       8.70       .34           .14           .48        (.34)     (.00)      (.22)         (.56)   

CLASS B                                                                                                                
Year Ended 10/31/10      $8.11      $.18(e)     $  .39        $  .57       $(.17)    $(.00)     $0.00         $(.17)   
Year Ended 10/31/09       7.40       .26(e)        .72           .98        (.23)     (.04)      0.00          (.27)   
Year Ended 10/31/08       9.03       .30(e)      (1.64)        (1.34)(h)    (.29)     (.00)      0.00          (.29)   
Year Ended 10/31/07       8.63       .26           .41           .67        (.27)     (.00)      0.00          (.27)   
Year Ended 10/31/06       8.70       .28           .14           .42        (.27)     (.00)      (.22)         (.49)   

CLASS C                                                                                                                
Year Ended 10/31/10      $8.10      $.18(e)     $  .39        $  .57       $(.17)    $(.00)     $0.00         $(.17)   
Year Ended 10/31/09       7.40       .26(e)        .71           .97        (.23)     (.04)      0.00          (.27)   
Year Ended 10/31/08       9.02       .29(e)      (1.61)        (1.32)(h)    (.30)     (.00)      0.00          (.30)   
Year Ended 10/31/07       8.63       .27           .39           .66        (.27)     (.00)      0.00          (.27)   
Year Ended 10/31/06       8.71       .28           .14           .42        (.28)     (.00)      (.22)         (.50)   

ADVISOR CLASS                                                                                                          
Year Ended 10/31/10      $8.09      $.26(e)     $  .39        $  .65       $(.25)    $(.00)     $0.00         $(.25)   
Year Ended 10/31/09       7.39       .32(e)        .72          1.04        (.30)     (.04)      0.00          (.34)   
Year Ended 10/31/08       9.02       .38(e)      (1.63)        (1.25)(h)    (.38)     (.00)      0.00          (.38)   
Year Ended 10/31/07       8.62       .37           .39           .76        (.36)     (.00)      0.00          (.36)   
Year Ended 10/31/06       8.70       .36           .14           .50        (.36)     (.00)      (.22)         (.58)   
-----------------------------------------------------------------------------------------------------------------------

Please refer to the footnotes on page 60.                                       

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                                          RATIOS/SUPPLEMENTAL DATA                  
                         ---------------------------------------------------------- 
              TOTAL                                        RATIO OF NET             
            INVESTMENT                      RATIO OF        INVESTMENT              
NET ASSET  RETURN BASED    NET ASSETS,      EXPENSES          INCOME       PORTFOLIO
VALUE, END ON NET ASSET   END OF PERIOD    TO AVERAGE       TO AVERAGE     TURNOVER 
OF PERIOD   VALUE (b)    (000'S OMITTED)   NET ASSETS       NET ASSETS       RATE   
------------------------------------------------------------------------------------
                                                                                    
  $8.50        12.38%      $1,744,323        .98%(c)(f)(g)     3.98%(c)(e)     69%  
   7.87        14.65        1,367,036        .93(f)(g)         5.65(e)         91   
   7.39        (3.75)       1,425,649       1.04(f)(g)         5.19(e)        140   
   8.07        12.47        1,071,398       1.80(f)            5.09           170   
   7.54         3.90          935,901       1.04(c)            5.81(c)        104   

  $8.51        11.60%      $   80,989       1.68%(c)(f)(g)     3.34%(c)(e)     69%  
   7.88        14.01           98,925       1.63(f)(g)         4.95(e)         91   
   7.39        (4.44)         137,926       1.75(f)(g)         4.52(e)        140   
   8.07        11.65          171,078       2.53(f)            4.36           170   
   7.54         3.28          277,450       1.76(c)            5.10(c)        104   

  $8.53        11.55%      $  684,415       1.67%(c)(f)(g)     3.26%(c)(e)     69%  
   7.90        13.95          526,963       1.63(f)(g)         4.92(e)         91   
   7.41        (4.42)         492,541       1.75(f)(g)         4.46(e)        140   
   8.09        11.65          307,616       2.50(f)            4.37           170   
   7.56         3.15          256,047       1.74(c)            5.07(c)        104   

  $8.50        12.71%      $  457,794        .66%(c)(f)(g)     4.21%(c)(e)     69%  
   7.87        15.10          191,855        .64(f)(g)         5.88(e)         91   
   7.38        (4.83)          89,152        .74(f)(g)(k)      5.37(e)(k)     140   

  $8.50         7.88%(d)   $   42,733        .90%(c)(g)        2.83%(c)(e)     54%  
   8.10        14.45(d)        46,138        .90(g)            4.24(e)         86   
   7.39       (14.57)(d)       39,639        .90(g)            4.13(e)         81   
   9.02         8.60(d)        48,542       1.47               3.81           134   
   8.62         5.61           25,348       1.78(c)(f)         3.93(c)        169   

  $8.51         7.13%(d)   $    3,856       1.60%(c)(g)        2.15%(c)(e)     54%  
   8.11        13.65(d)         6,226       1.60(g)            3.66(e)         86   
   7.40       (15.15)(d)       13,666       1.60(g)            3.43(e)         81   
   9.03         7.77(d)        27,303       2.28               2.93           134   
   8.63         4.96           40,136       2.50(c)(f)         3.24(c)        169   

  $8.50         7.13%(d)   $   13,236       1.60%(c)(g)        2.13%(c)(e)     54%  
   8.10        13.50(d)        14,376       1.60(g)            3.53(e)         86   
   7.40       (15.05)(d)       11,245       1.60(g)            3.44(e)         81   
   9.02         7.69(d)        15,208       2.20               3.03           134   
   8.63         4.86           11,040       2.49(c)(f)         3.22(c)        169   

  $8.49         8.21%(d)   $   12,660        .60%(c)(g)        3.14%(c)(e)     54%  
   8.09        14.64(d)        12,255        .60(g)            4.39(e)         86   
   7.39       (14.31)(d)        3,756        .60(g)            4.42(e)         81   
   9.02         8.89(d)         5,529       1.14               4.00           134   
   8.62         5.94            2,494       1.49(c)(f)         4.17(c)        169   
------------------------------------------------------------------------------------

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                                  INCOME FROM INVESTMENT OPERATIONS           LESS: DIVIDENDS AND DISTRIBUTIONS       
                               -----------------------------------     ---------------------------------------------- 
                                                         NET INCREASE                                                 
                     NET ASSET             NET REALIZED   (DECREASE)   DIVIDENDS    TAX   DISTRIBUTIONS               
                      VALUE,      NET     AND UNREALIZED IN NET ASSET   FROM NET  RETURN     FROM NET     TOTAL DIVI- 
FISCAL YEAR OR       BEGINNING INVESTMENT GAIN (LOSS) ON  VALUE FROM   INVESTMENT   OF    REALIZED GAIN    DENDS AND  
PERIOD               OF PERIOD INCOME (a)  INVESTMENTS    OPERATIONS     INCOME   CAPITAL ON INVESTMENTS DISTRIBUTIONS
----------------------------------------------------------------------------------------------------------------------
                                                                                                                      
HIGH INCOME                                                                                                           
CLASS A                                                                                                               
Year Ended 10/31/10    $8.24      $.69(e)     $  .96        $ 1.65(h)    $(.70)    $(.00)     $0.00          $(.70)   
Year Ended 10/31/09     5.85       .67(e)       2.44          3.11        (.69)     (.01)      (.02)          (.72)   
Year Ended 10/31/08     9.02       .61(e)      (2.87)        (2.26)(h)    (.68)     (.00)      (.23)          (.91)   
Year Ended 10/31/07     8.97       .56           .41           .97        (.57)     (.00)      (.35)          (.92)   
Year Ended 10/31/06     8.70       .55           .43           .98        (.57)     (.00)      (.14)          (.71)   

CLASS B                                                                                                               
Year Ended 10/31/10    $8.31      $.63(e)     $  .96        $ 1.59(h)    $(.64)    $(.00)     $0.00          $(.64)   
Year Ended 10/31/09     5.90       .62(e)       2.46          3.08        (.64)     (.01)      (.02)          (.67)   
Year Ended 10/31/08     9.09       .55(e)      (2.89)        (2.34)(h)    (.62)     (.00)      (.23)          (.85)   
Year Ended 10/31/07     9.05       .49           .41           .90        (.51)     (.00)      (.35)          (.86)   
Year Ended 10/31/06     8.77       .49           .44           .93        (.51)     (.00)      (.14)          (.65)   

CLASS C                                                                                                               
Year Ended 10/31/10    $8.33      $.62(e)     $  .97        $ 1.59(h)    $(.63)    $(.00)     $0.00          $(.63)   
Year Ended 10/31/09     5.92       .62(e)       2.46          3.08        (.64)     (.01)      (.02)          (.67)   
Year Ended 10/31/08     9.11       .55(e)      (2.89)        (2.34)(h)    (.62)     (.00)      (.23)          (.85)   
Year Ended 10/31/07     9.07       .49           .41           .90        (.51)     (.00)      (.35)          (.86)   
Year Ended 10/31/06     8.79       .49           .44           .93        (.51)     (.00)      (.14)          (.65)   

ADVISOR CLASS                                                                                                         
Year Ended 10/31/10    $8.25      $.71(e)     $  .97        $ 1.68(h)    $(.73)    $(.00)     $0.00          $(.73)   
Year Ended 10/31/09     5.86       .72(e)       2.41          3.13        (.71)     (.01)      (.02)          (.74)   
1/28/08(j) to                                                                                                         
 10/31/08               8.52       .52(e)      (2.69)        (2.17)(h)    (.49)     (.00)      0.00           (.49)   
----------------------------------------------------------------------------------------------------------------------

Please refer to the footnotes on page 60.                                       

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                                            RATIOS/SUPPLEMENTAL DATA                    
                         -------------------------------------------------------------- 
              TOTAL                                           RATIO OF NET              
            INVESTMENT                       RATIO OF          INVESTMENT               
NET ASSET  RETURN BASED    NET ASSETS,       EXPENSES            INCOME        PORTFOLIO
VALUE, END ON NET ASSET   END OF PERIOD     TO AVERAGE         TO AVERAGE      TURNOVER 
OF PERIOD   VALUE (b)    (000'S OMITTED)    NET ASSETS         NET ASSETS        RATE   
----------------------------------------------------------------------------------------
                                                                                        
  $9.19        20.85%(d)   $1,326,974        .99%(c)(f)(g)       7.93%(c)(e)      26%   
   8.24        57.11(d)       780,222        .99(f)(g)          10.13(e)          46    
   5.85       (27.49)(d)      450,517       1.03(c)(f)(g)        7.65(c)(e)       74    
   9.02        11.54          281,677       1.41(c)(f)           6.24(c)          67    
   8.97        11.87          235,763       1.48(f)              6.32             75    

  $9.26        19.86%(d)   $   40,092       1.70%(c)(f)(g)       7.25%(c)(e)      26%   
   8.31        55.89(d)        52,041       1.68(f)(g)           9.46(e)          46    
   5.90       (28.03)(d)       54,724       1.74(c)(f)(g)        6.83(c)(e)       74    
   9.09        10.51           35,058       2.14(c)(f)           5.45(c)          67    
   9.05        11.11           45,133       2.18(f)              5.55             75    

  $9.29        19.88%(d)   $  541,386       1.69%(c)(f)(g)       7.08%(c)(e)      26%   
   8.33        55.68(d)       222,632       1.69(f)(g)           9.27(e)          46    
   5.92       (27.95)(d)      112,508       1.75(c)(f)(g)        6.82(c)(e)       74    
   9.11        10.50           86,525       2.11(c)(f)           5.47(c)          67    
   9.07        11.10           88,046       2.17(f)              5.54             75    

  $9.20        21.22%(d)   $  385,380        .68%(c)(f)(g)       8.12%(c)(e)      26%   
   8.25        57.57(d)        76,843        .72(f)(g)          10.07(e)          46    
   5.86       (26.77)(d)        6,095        .69(c)(f)(g)(k)     8.16(c)(e)(k)    74    
----------------------------------------------------------------------------------------

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(a)Based on average shares outstanding.                                         

(b)Total investment return is calculated assuming an initial investment made at 
the NAV at the beginning of the period, reinvestment of all dividends and 
  distributions at the NAV during the period, and a redemption on the last day
 of the period. Initial sales charge or contingent deferred sales charge, if
 applicable, is not reflected in the calculation of total investment return.
Total investment return does not reflect the deduction of taxes that a    
shareholder would pay on fund distributions or the redemption of fund     
shares. Total investment returns calculated for periods of less than one  
year are not annualized.                                                  

(c)The ratio includes expenses attributable to costs of proxy solicitation.     

(d)Includes the impact of proceeds received and credited to the Fund resulting  
from the class action settlements, which enhanced the performance of each 
share class.                                                              

                                                                [Download Table]

                                     FOR FISCAL YEAR ENDED      
----------------------------------------------------------------
                                                                
ALLIANCEBERNSTEIN SHORT DURATION      September 30, 2010    .01%
                                      September 30, 2008    .05%
ALLIANCEBERNSTEIN INTERMEDIATE BOND   October 31, 2010      .01%
                                      October 31, 2009      .01%
                                      October 31, 2008      .21%
                                      October 31, 2007      .61%
ALLIANCEBERNSTEIN DIVERSIFIED YIELD   October 31, 2010      .55%
                                      October 31, 2009      .57%
                                      October 31, 2008      .81%
                                      October 31, 2007     4.31%
ALLIANCEBERNSTEIN HIGH INCOME         October 31, 2010      .15%
                                      October 31, 2009      .05%
                                      October 31, 2008      .41%

(e)Net of fees waived and expenses reimbursed by the Adviser.                   

(f)Includes interest expense. For the following Funds, the ratio of gross       
 expenses to average net assets, excluding interest expense (and any related
expenses), would have been as follows:                                    

                                                                [Download Table]

                                      2010  2009   2008   2007   2006 
----------------------------------------------------------------------
                                                                      
ALLIANCEBERNSTEIN INTERMEDIATE BOND                                   
Class A                              1.05%* 1.07%                     
Class B                              1.81%* 1.84%                     
Class C                              1.77%* 1.78%                     
Advisor Class                         .75%*  .76%                     
ALLIANCEBERNSTEIN GLOBAL BOND                                         
Class A                               .95%*  .97% 1.01%  1.05%        
Class B                              1.68%* 1.71% 1.73%  1.77%        
Class C                              1.65%* 1.67% 1.71%  1.75%        
Advisor Class                         .65%*  .65%  .74%               
ALLIANCEBERNSTEIN DIVERSIFIED YIELD                                   
Class A                                                         1.72%*
Class B                                                         2.45%*
Class C                                                         2.44%*
Advisor Class                                                   1.44%*
ALLIANCEBERNSTEIN HIGH INCOME                                         
Class A                              1.00%* 1.09% 1.07%* 1.14%* 1.14% 
Class B                              1.73%* 1.85% 1.80%* 1.87%* 1.85% 
Class C                              1.69%* 1.79% 1.77%* 1.85%* 1.84% 
Advisor Class                         .70%*  .76%  .76%*              

--------                                                                        
*The ratio includes expenses attributable to costs of proxy solicitation. 

(g)Net of fees waived by the Adviser. If the following Funds had borne all      
  expenses for the respective year ends, the expense ratios would have been as
follows:                                                                  

                                                                [Download Table]

                                      2010  2009  2008  2007   2006 
--------------------------------------------------------------------
                                                                    
ALLIANCEBERNSTEIN INTERMEDIATE BOND                                 
Class A                              1.11%* 1.11% 1.09% 1.54% 1.34%*
Class B                              1.88%* 1.87% 1.83% 2.29% 2.10%*
Class C                              1.83%* 1.82% 1.80% 2.27% 2.07%*
Advisor Class                         .80%*  .80%  .80% 1.25% 1.02%*
ALLIANCEBERNSTEIN GLOBAL BOND                                       
Class A                              1.02%* 1.00% 1.15%             
Class B                              1.76%* 1.73% 1.88%             
Class C                              1.73%* 1.70% 1.86%             
Advisor Class                         .72%*  .69%  .88%             
ALLIANCEBERNSTEIN DIVERSIFIED YIELD                                 
Class A                              1.55%* 1.69% 1.65%             
Class B                              2.30%* 2.49% 2.41%             
Class C                              2.26%* 2.39% 2.36%             
Advisor Class                        1.23%* 1.28% 1.33%             
ALLIANCEBERNSTEIN HIGH INCOME                                       
Class A                              1.04%* 1.13% 1.13%             
Class B                              1.78%* 1.88% 1.86%             
Class C                              1.73%* 1.83% 1.84%             
Advisor Class                         .73%*  .83%  .80%             

--------                                                                        
*The ratio includes expenses attributable to costs of proxy solicitation. 

(h)Amount includes contribution from Advisor of less than $ .005.               

(i)Net of fees and expenses waived by the distributor.                          

(j)Commencement of distribution.                                                

(k)Annualized.                                                                  

60                                                                              

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APPENDIX A                                                                      
--------------------------------------------------------------------------------

BOND RATINGS                                                                    
MOODY'S INVESTORS SERVICE, INC.                                                 
Aaa--Bonds which are rated Aaa are judged to be of the best quality. They carry 
the smallest degree of investment risk and are generally referred to as "gilt   
edge." Interest payments are protected by a large or by an exceptionally stable 
margin and principal is secure. While the various protective elements are       
likely to change, such changes as can be visualized are most unlikely to impair 
the fundamentally strong position of such issues.                               

Aa--Bonds which are rated Aa are judged to be of high quality by all standards. 
Together with the Aaa group they comprise what are generally known as high      
grade bonds. They are rated lower than the best bonds because margins of        
protection may not be as large as in Aaa securities or fluctuation of           
protective elements may be of greater amplitude or there may be other elements  
present which make the long-term risks appear somewhat larger than the Aaa      
securities.                                                                     

A--Bonds which are rated A possess many favorable investment attributes and are 
to be considered as upper-medium-grade obligations. Factors giving security to  
principal and interest are considered adequate but elements may be present      
which suggest a susceptibility to impairment some time in the future.           

Baa--Bonds which are rated Baa are considered as medium-grade obligations,      
i.e., they are neither highly protected nor poorly secured. Interest payments   
and principal security appear adequate for the present but certain protective   
elements may be lacking or may be characteristically unreliable over any great  
length of time. Such bonds lack outstanding investment characteristics and in   
fact have speculative characteristics as well.                                  

Ba--Bonds which are rated Ba are judged to have speculative elements; their     
future cannot be considered as well-assured. Often the protection of interest   
and principal payments may be very moderate and thereby not well safeguarded    
during both good and bad times over the future. Uncertainty of position         
characterizes bonds in this class.                                              

B--Bonds which are rated B generally lack characteristics of the desirable      
investment. Assurance of interest and principal payments or of maintenance of   
other terms of the contract over any long period of time may be small.          

Caa--Bonds which are rated Caa are of poor standing. Such issues may be in      
default or there may be present elements of danger with respect to principal or 
interest.                                                                       

Ca--Bonds which are rated Ca represent obligations which are speculative in a   
high degree. Such issues are often in default or have other marked shortcomings.

C--Bonds which are rated C are the lowest rated class of bonds and issues so    
rated can be regarded as having extremely poor prospects of ever attaining any  
real investment standing.                                                       

Absence of Rating--When no rating has been assigned or where a rating has been  
suspended or withdrawn, it may be for reasons unrelated to the quality of the   
issue.                                                                          

Should no rating be assigned, the reason may be one of the following:           

1. An application for rating was not received or accepted.                      

2. The issue or issuer belongs to a group of securities or companies that are   
unrated as a matter of policy.                                            

3. There is a lack of essential data pertaining to the issue or issuer.         

4. The issue was privately placed, in which case the rating is not published in 
Moody's publications.                                                     

Suspension or withdrawal may occur if new and material circumstances arise, the 
effects of which preclude satisfactory analysis; if there is no longer          
available reasonable up-to-date data to permit a judgment to be formed; if a    
bond is called for redemption; or for other reasons.                            

Note--Moody's applies numerical modifiers, 1, 2 and 3 in each generic rating    
classification from Aa through Caa in its corporate bond rating system. The     
modifier 1 indicates that the security ranks in the higher end of its generic   
rating category; the modifier 2 indicates a mid-range ranking; and the modifier 
3 indicates that the issue ranks in the lower end of its generic rating         
category.                                                                       

STANDARD & POOR'S RATINGS SERVICES                                              
AAA--Debt rated AAA has the highest rating assigned by S&P. Capacity to pay     
interest and repay principal is extremely strong.                               

AA--Debt rated AA has a very strong capacity to pay interest and repay          
principal and differs from the highest rated issues only in small degree.       

A--Debt rated A has a strong capacity to pay interest and repay principal       
although it is somewhat more susceptible to the adverse effects of changes in   
circumstances and economic conditions than debt in higher rated categories.     

BBB--Debt rated BBB normally exhibits adequate protection parameters. However,  
adverse economic conditions or changing circumstances are more likely to lead   
to a weakened capacity to pay interest and repay principal for debt in this     
category than in higher rated categories.                                       

BB, B, CCC, CC, C--Debt rated BB, B, CCC, CC or C is regarded as having         
significant speculative characteristics. BB indicates the lowest degree of      
speculation and C the highest. While such debt will likely have some quality    
and protective characteristics, these are outweighed by large uncertainties or  
major exposures to adverse conditions.                                          

                                                                           A-1

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BB--Debt rated BB is less vulnerable to nonpayment than other speculative debt. 
However, it faces major ongoing uncertainties or exposure to adverse business,  
financial or economic conditions which could lead to an inadequate capacity to  
pay interest and repay principal.                                               

B--Debt rated B is more vulnerable to nonpayment than debt rated BB, but there  
is capacity to pay interest and repay principal. Adverse business, financial or 
economic conditions will likely impair the capacity or willingness to pay       
principal or repay interest.                                                    

CCC--Debt rated CCC is currently vulnerable to nonpayment, and is dependent     
upon favorable business, financial and economic conditions to pay interest and  
repay principal. In the event of adverse business, financial or economic        
conditions, there is not likely to be capacity to pay interest or repay         
principal.                                                                      

CC--Debt rated CC is currently highly vulnerable to nonpayment.                 

C--The C rating may be used to cover a situation where a bankruptcy petition    
has been filed or similar action has been taken, but payments are being         
continued.                                                                      

D--The D rating, unlike other ratings, is not prospective; rather, it is used   
only where a default has actually occurred.                                     

Plus (+) or Minus (-)--The ratings from AA to CCC may be modified by the        
addition of a plus or minus sign to show relative standing within the major     
rating categories.                                                              

NR--Not rated.                                                                  

FITCH RATINGS                                                                   
AAA--Bonds considered to be investment grade and of the highest credit quality. 
The obligor has an exceptionally strong ability to pay interest and repay       
principal, which is unlikely to be affected by reasonably foreseeable events.   

AA--Bonds considered to be investment grade and of very high credit quality.    
The obligor's ability to pay interest and repay principal is very strong,       
although not quite as strong as bonds rated AAA. Because bonds rated in the AAA 
and AA categories are not significantly vulnerable to foreseeable future        
developments, short-term debt of these issuers is generally rated F1+.          

A--Bonds considered to be investment grade and of high credit quality. The      
obligor's ability to pay interest and repay principal is considered to be       
strong, but may be more vulnerable to adverse changes in economic conditions    
and circumstances than bonds with higher ratings.                               

BBB--Bonds considered to be investment grade and of satisfactory credit         
quality. The obligor's ability to pay interest and repay principal is           
considered to be adequate. Adverse changes in economic conditions and           
circumstances, however, are more likely to have adverse impact on these bonds,  
and therefore impair timely payment. The likelihood that the ratings of these   
bonds will fall below investment grade is higher than for bonds with higher     
ratings.                                                                        

BB--Bonds are considered speculative. The obligor's ability to pay interest and 
repay principal may be affected over time by adverse economic changes. However, 
business and financial alternatives can be identified which could assist the    
obligor in satisfying its debt service requirements.                            

B--Bonds are considered highly speculative. While bonds in this class are       
currently meeting debt service requirements, the probability of continued       
timely payment of principal and interest reflects the obligor's limited margin  
of safety and the need for reasonable business and economic activity throughout 
the life of the issue.                                                          

CCC--Bonds have certain identifiable characteristics which, if not remedied,    
may lead to default. The ability to meet obligations requires an advantageous   
business and economic environment.                                              

CC--Bonds are minimally protected. Default in payment of interest and/or        
principal seems probable over time.                                             

C--Bonds are in imminent default in payment of interest or principal.           

DDD, DD, D--Bonds are in default on interest and/or principal payments. Such    
bonds are extremely speculative and should be valued on the basis of their      
ultimate recovery value in liquidation or reorganization of the obligor. DDD    
represents the highest potential for recovery on these bonds, and D represents  
the lowest potential for recovery.                                              

Plus (+) Minus (-)--Plus and minus signs are used with a rating symbol to       
indicate the relative position of a credit within the rating category. Plus and 
minus signs, however, are not used in the AAA category or in categories below B.

NR--Indicates that Fitch does not rate the specific issue.                      

DOMINION BOND RATING SERVICE LIMITED                                            
Each rating category is denoted by the subcategories "high" and "low". The      
absence of either a "high" or "low" designation indicates the rating is in the  
"middle" of the category. The AAA and D categories do not utilize "high",       
"middle", and "low" as differential grades.                                     

AAA--Long-term debt rated AAA is of the highest credit quality, with            
exceptionally strong protection for the timely repayment of principal and       
interest. Earnings are considered stable, the structure of the industry in      
which the entity operates is strong, and the outlook for future profitability   
is favorable. There are few qualifying factors present that would detract from  
the performance of the entity. The strength of liquidity and coverage ratios is 
unquestioned and the entity has established a credible track record of superior 
performance. Given the extremely high standard that Dominion has set for this   
category, few entities are able to achieve a AAA rating.                        

AA--Long-term debt rated AA is of superior credit quality, and protection of    
interest and principal is considered high. In many cases they differ from       
long-term debt rated AAA only to a small degree. Given the extremely            
restrictive definition Dominion has for the AAA category, entities rated AA are 
also                                                                            

A-2                                                                             

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considered to be strong credits, typically exemplifying above-average strength  
in key areas of consideration and unlikely to be significantly affected by      
reasonably foreseeable events.                                                  

A--Long-term debt rated A is of satisfactory credit quality. Protection of      
interest and principal is still substantial, but the degree of strength is less 
than that of AA rated entities. While A is a respectable rating, entities in    
this category are considered to be more susceptible to adverse economic         
conditions and have greater cyclical tendencies than higher-rated securities.   

BBB--Long-term debt rated BBB is of adequate credit quality. Protection of      
interest and principal is considered acceptable, but the entity is fairly       
susceptible to adverse changes in financial and economic conditions, or there   
may be other adverse conditions present which reduce the strength of the entity 
and its rated securities.                                                       

BB--Long-term debt rated BB is defined to be speculative and non-investment     
grade, where the degree of protection afforded interest and principal is        
uncertain, particularly during periods of economic recession. Entities in the   
BB range typically have limited access to capital markets and additional        
liquidity support. In many cases, deficiencies in critical mass,                
diversification, and competitive strength are additional negative               
considerations.                                                                 

B--Long-term debt rated B is considered highly speculative and there is a       
reasonably high level of uncertainty as to the ability of the entity to pay     
interest and principal on a continuing basis in the future, especially in       
periods of economic recession or industry adversity.                            

CCC, CC and C--Long-term debt rated in any of these categories is very highly   
speculative and is in danger of default of interest and principal. The degree   
of adverse elements present is more severe than long-term debt rated B.         
Long-term debt rated below B often have features which, if not remedied, may    
lead to default. In practice, there is little difference between these three    
categories, with CC and C normally used for lower ranking debt of companies for 
which the senior debt is rated in the CCC to B range.                           

D--A security rated D implies the issuer has either not met a scheduled payment 
of interest or principal or that the issuer has made it clear that it will miss 
such a payment in the near future. In some cases, Dominion may not assign a D   
rating under a bankruptcy announcement scenario, as allowances for grace        
periods may exist in the underlying legal documentation. Once assigned, the D   
rating will continue as long as the missed payment continues to be in arrears,  
and until such time as the rating is suspended, discontinued, or reinstated by  
Dominion.                                                                       

                                                                           A-3

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APPENDIX B                                                                      
--------------------------------------------------------------------------------

HYPOTHETICAL INVESTMENT AND EXPENSE INFORMATION                                 
--------------------------------------------------------------------------------

The settlement agreement between the Adviser and the New York State Attorney    
General requires the Funds to include the following supplemental hypothetical   
investment information, which provides additional information calculated and    
presented in a manner different from expense information found under "Fees and  
Expenses of the Fund" in the Summary Information at the beginning of this       
Prospectus about the effect of a Fund's expenses, including investment advisory 
fees and other Fund costs, on each Fund's returns over a 10-year period. The    
chart shows the estimated expenses that would be charged on a hypothetical      
investment of $10,000 in Class A shares of each Fund assuming a 5% return each  
year, including an initial sales charge of 4.25%. Except as otherwise           
indicated, the chart also assumes that the current annual expense ratio stays   
the same throughout the 10-year period. The current annual expense ratio for    
each Fund is the same as stated under "Financial Highlights." If you wish to    
obtain hypothetical investment information for other classes of shares of each  
Fund, please refer to the "Mutual Fund Fees & Expenses Calculators" on          
www.AllianceBernstein.com. Your actual expenses may be higher or lower.         

ALLIANCEBERNSTEIN SHORT DURATION PORTFOLIO                                      
--------------------------------------------------------------------------------

                                                                [Download Table]

                    HYPOTHETICAL INVESTMENT              HYPOTHETICAL
       HYPOTHETICAL PERFORMANCE    AFTER    HYPOTHETICAL    ENDING   
YEAR    INVESTMENT    EARNINGS    RETURNS     EXPENSES    INVESTMENT 
---------------------------------------------------------------------
                                                                     
1       $10,000.00   $  478.75   $10,053.75  $  519.51    $ 9,959.24 
2         9,959.24      497.96    10,457.20      98.30     10,358.90 
3        10,358.90      517.95    10,876.85     102.24     10,774.81 
4        10,774.61      538.73    11,313.34     106.35     11,206.99 
5        11,206.99      560.35    11,767.34     110.61     11,656.73 
6        11,656.73      582.84    12,239.57     115.05     12,124.52 
7        12,124.52      606.23    12,730.75     119.67     12,611.08 
8        12,611.08      630.55    13,241.63     124.47     13,117.16 
9        13,117.16      655.86    13,773.02     129.47     13,643.55 
10       13,643.55      682.18    14,325.73     134.66     14,191.07 
---------------------------------------------------------------------
Total                $5,751.40               $1,560.33               

ALLIANCEBERNSTEIN INTERMEDIATE BOND PORTFOLIO                                   
--------------------------------------------------------------------------------

                                                                [Download Table]

                    HYPOTHETICAL INVESTMENT               HYPOTHETICAL
       HYPOTHETICAL PERFORMANCE    AFTER     HYPOTHETICAL    ENDING   
YEAR    INVESTMENT    EARNINGS    RETURNS     EXPENSES*    INVESTMENT 
----------------------------------------------------------------------
                                                                      
1       $10,000.00   $  478.75   $10,053.75   $  514.48    $ 9,964.27 
2         9,964.27      498.21    10,462.48      116.13     10,346.35 
3        10,346.35      517.32    10,863.67      120.59     10,743.08 
4        10,743.08      537.15    11,280.23      125.21     11,155.02 
5        11,155.02      557.75    11,712.77      130.01     11,582.76 
6        11,582.76      579.14    12,161.90      135.00     12,026.90 
7        12,026.90      601.35    12,628.25      140.17     12,488.08 
8        12,488.08      624.40    13,112.48      145.55     12,966.93 
9        12,966.93      648.35    13,615.28      151.13     13,464.15 
10       13,464.15      673.21    14,137.36      156.92     13,980.44 
----------------------------------------------------------------------
Total                $5,715.63                $1,735.19               

ALLIANCEBERNSTEIN GLOBAL BOND FUND                                              
--------------------------------------------------------------------------------

                                                                [Download Table]

                    HYPOTHETICAL INVESTMENT               HYPOTHETICAL
       HYPOTHETICAL PERFORMANCE    AFTER     HYPOTHETICAL    ENDING   
YEAR    INVESTMENT    EARNINGS    RETURNS     EXPENSES*    INVESTMENT 
----------------------------------------------------------------------
                                                                      
1       $10,000.00   $  478.75   $10,053.75   $  523.53    $ 9,955.22 
2         9,955.22      497.76    10,452.98      106.62     10,346.36 
3        10,346.36      517.32    10,863.68      110.81     10,752.87 
4        10,752.87      537.64    11,290.51      115.16     11,175.35 
5        11,175.35      558.77    11,734.12      119.69     11,614.43 
6        11,614.43      580.72    12,195.15      124.39     12,070.76 
7        12,070.76      603.54    12,674.30      129.28     12,545.02 
8        12,545.02      627.25    13,172.27      134.36     13,037.91 
9        13,037.91      651.90    13,689.81      139.64     13,550.17 
10       13,550.17      677.51    14,227.68      145.12     14,082.56 
----------------------------------------------------------------------
Total                $5,731.16                $1,648.60               

B-1                                                                             

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ALLIANCEBERNSTEIN DIVERSIFIED YIELD FUND                                        
--------------------------------------------------------------------------------

                                                                [Download Table]

                    HYPOTHETICAL INVESTMENT               HYPOTHETICAL
       HYPOTHETICAL PERFORMANCE    AFTER     HYPOTHETICAL    ENDING   
YEAR    INVESTMENT    EARNINGS    RETURNS     EXPENSES*    INVESTMENT 
----------------------------------------------------------------------
                                                                      
1       $10,000.00   $  478.75   $10,053.75   $  515.48    $ 9,963.27 
2         9,963.27      498.16    10,461.43      162.15     10,299.28 
3        10,299.28      514.96    10,814.24      167.62     10,646.62 
4        10,646.62      532.33    11,178.95      173.27     11,005.68 
5        11,005.68      550.28    11,555.96      179.12     11,376.84 
6        11,376.84      568.84    11,945.68      185.16     11,760.52 
7        11,760.52      588.03    12,348.55      191.40     12,157.15 
8        12,157.15      607.86    12,765.01      197.86     12,567.15 
9        12,567.15      628.36    13,195.51      204.53     12,990.98 
10       12,990.98      649.55    13,640.53      211.43     13,429.10 
----------------------------------------------------------------------
Total                $5,617.12                $2,188.02               

ALLIANCEBERNSTEIN HIGH INCOME FUND                                              
--------------------------------------------------------------------------------

                                                                [Download Table]

                    HYPOTHETICAL INVESTMENT               HYPOTHETICAL
       HYPOTHETICAL PERFORMANCE    AFTER     HYPOTHETICAL    ENDING   
YEAR    INVESTMENT    EARNINGS    RETURNS     EXPENSES*    INVESTMENT 
----------------------------------------------------------------------
                                                                      
1       $10,000.00   $  478.75   $10,053.75   $  524.53    $ 9,954.22 
2         9,954.22      497.71    10,451.93      108.70     10,343.23 
3        10,343.23      517.16    10,860.39      112.95     10,747.44 
4        10,747.44      537.37    11,284.81      117.36     11,167.45 
5        11,167.45      558.37    11,725.82      121.95     11,603.87 
6        11,603.87      580.19    12,184.06      126.71     12,057.35 
7        12,057.35      602.87    12,660.22      131.67     12,528.55 
         12,528.55      626.43    13,154.98      136.81     13,018.17 
9        13,018.17      650.91    13,669.08      142.16     13,526.92 
10       13,526.92      676.35    14,203.27      147.71     14,055.56 
----------------------------------------------------------------------
Total                $5,726.11                $1,670.55               

* Expenses are net of any fee waiver or expense waiver for the first year.      
Thereafter, the expense ratio reflects the Fund's operating expenses as     
reflected under "Fees and Expenses of the Fund" before waiver in the Summary
Information at the beginning of this Prospectus.                            

                                                                           B-2

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For more information about the Funds, the following documents are available     
upon request:                                                                   

..  ANNUAL/SEMI-ANNUAL REPORTS TO SHAREHOLDERS                                  
The Funds' annual and semi-annual reports to shareholders contain additional    
information on the Funds' investments. In the annual report, you will find a    
discussion of the market conditions and investment strategies that              
significantly affected a Fund's performance during its last fiscal year.        

..  STATEMENT OF ADDITIONAL INFORMATION (SAI)                                   
The Funds have SAIs, which contains more detailed information about the Funds,  
including their operations and investment policies. The Funds' SAIs and the     
independent registered public accounting firms' reports and financial           
statements in each Fund's most recent annual report to shareholders are         
incorporated by reference into (and are legally part of) this Prospectus.       

You may request a free copy of the current annual/semi-annual report or the     
SAIs, or make inquiries concerning the Funds, by contacting your broker or      
other financial intermediary, or by contacting the Adviser:                     

                                                                [Download Table]
                                                               
BY MAIL:          c/o AllianceBernstein Investor Services, Inc.
                  P.O. Box 786003                              
                  San Antonio, TX 78278-6003                   

BY PHONE:         For Information: (800) 221-5672              
                  For Literature: (800) 227-4618               

ON THE INTERNET:  www.AllianceBernstein.com                    

Or you may view or obtain these documents from the Securities and Exchange      
Commission (the "Commission"):                                                  

..  Call the Commission at 1-202-551-8090 for information on the operation of   
the Public Reference Room.                                                

..  Reports and other information about the Funds are available on the EDGAR    
Database on the Commission's Internet site at http://www.sec.gov.         

..  Copies of the information may be obtained, after paying a duplicating fee,  
 by electronic request at publicinfo@sec.gov, or by writing the Commission's
Public Reference Section, Washington, DC 20549-1520.                      

You also may find these documents and more information about the Adviser and    
the Funds on the Internet at: www.AllianceBernstein.com.                        

AllianceBernstein(R) and the AB Logo are registered trademarks and service      
marks used by permission of the owner, AllianceBernstein L.P.                   

                                                                [Download Table]

FUND               SEC FILE NO.
-------------------------------
                               
Short Duration      811-05555  
Intermediate Bond   811-02383  
Global Bond         811-06554  
Diversified Yield   811-07391  
High Income         811-08188  

                                                                 PRO-0115-0111

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BOND FUNDS - RETIREMENT SHARES -- (CLASS A, R, K AND I SHARES)                  

PROSPECTUS  |  JANUARY 31, 2011                                                 

The AllianceBernstein Bond Funds                                                

                                                        [Enlarge/Download Table]
                                                                                                    
Core                                               High Income                                      
(Shares Offered--Exchange Ticker Symbol)           (Shares Offered--Exchange Ticker Symbol)         

    AllianceBernstein Intermediate Bond Portfolio      AllianceBernstein High Income Fund           
    (Class A-ABQUX; Class R-ABQRX; Class K-ABQKX;      (Class A-AGDAX; Class R-AGDRX; Class K-AGDKX;
     Class I-ABQIX)                                     Class I-AGDIX)                              

    AllianceBernstein Global Bond Fund                                                              
    (Class A-ANAGX; Class R-ANARX; Class K-ANAKX;                                                   
     Class I-ANAIX)                                                                                 

Absolute Return                                                                                     
(Shares Offered--Exchange Ticker Symbol)                                                            

    AllianceBernstein Diversified Yield Fund                                                        
    (Class A-AGSAX; Class R-AGSRX; Class K-AGSKX;                                                   
     Class I-AGLIX)                                                                                 

The Securities and Exchange Commission has not approved or disapproved these    
securities or passed upon the adequacy of this Prospectus. Any representation   
to the contrary is a criminal offense.                                          

[LOGO]                                                                
AB                                                                
ALLIANCEBERNSTEIN                                                               

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INVESTMENT PRODUCTS OFFERED                                                     
..  ARE NOT FDIC INSURED                                                        
..  MAY LOSE VALUE                                                              
..  ARE NOT BANK GUARANTEED                                                     

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TABLE OF CONTENTS                                                               
--------------------------------------------------------------------------------

                                                                [Download Table]

                                                               Page
                                                                   
SUMMARY INFORMATION...........................................   4 
CORE                                                               
  ALLIANCEBERNSTEIN INTERMEDIATE BOND PORTFOLIO...............   4 
  ALLIANCEBERNSTEIN GLOBAL BOND FUND..........................   8 
ABSOLUTE RETURN                                                    
  ALLIANCEBERNSTEIN DIVERSIFIED YIELD FUND....................  12 
HIGH INCOME                                                        
  ALLIANCEBERNSTEIN HIGH INCOME FUND..........................  16 
ADDITIONAL INFORMATION ABOUT THE FUNDS' RISKS AND INVESTMENTS.  21 
INVESTING IN THE FUNDS........................................  30 
  How to Buy Shares...........................................  30 
  The Different Share Class Expenses..........................  30 
  Distribution Arrangements for Group Retirement Plans........  31 
  Payments to Financial Intermediaries........................  31 
  How to Exchange Shares......................................  32 
  How to Sell or Redeem Shares................................  32 
  Frequent Purchases and Redemptions of Fund Shares...........  32 
  How the Funds Value Their Shares............................  34 
MANAGEMENT OF THE FUNDS.......................................  35 
DIVIDENDS, DISTRIBUTIONS AND TAXES............................  39 
GENERAL INFORMATION...........................................  40 
GLOSSARY OF INVESTMENT TERMS..................................  41 
FINANCIAL HIGHLIGHTS..........................................  43 
APPENDIX A--BOND RATINGS...................................... A-1 
APPENDIX B--HYPOTHETICAL INVESTMENT AND EXPENSE INFORMATION... B-1 

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SUMMARY INFORMATION                                                             
--------------------------------------------------------------------------------

ALLIANCEBERNSTEIN INTERMEDIATE BOND PORTFOLIO                                   
--------------------------------------------------------------------------------

INVESTMENT OBJECTIVE                                                            
The Fund's investment objective is to generate income and price appreciation    
without assuming what the Adviser considers undue risk.                         

FEES AND EXPENSES OF THE FUND                                                   
This table describes the fees and expenses that you may pay if you buy and hold 
shares of the Fund.                                                             

SHAREHOLDER FEES (fees paid directly from your investment)                      

                                                        [Enlarge/Download Table]

                                                                                CLASS A  CLASS R CLASS K CLASS I
                                                                                SHARES   SHARES  SHARES  SHARES 
----------------------------------------------------------------------------------------------------------------
                                                                                                                
Maximum Sales Charge (Load) Imposed on Purchases                                                                
(as a percentage of offering price)                                              None     None    None    None  
----------------------------------------------------------------------------------------------------------------
Maximum Deferred Sales Charge (Load)                                                                            
(as a percentage of offering price or redemption proceeds, whichever is lower)   None(a)  None    None    None  
----------------------------------------------------------------------------------------------------------------
Exchange Fee                                                                     None     None    None    None  

ANNUAL FUND OPERATING EXPENSES (expenses that you pay each year as a percentage 
of the value of your investment)                                                

                                                        [Enlarge/Download Table]

                                                                                        CLASS A CLASS R CLASS K CLASS I
-----------------------------------------------------------------------------------------------------------------------
                                                                                                                       
Management Fees                                                                           .45%    .45%    .45%    .45% 
Distribution and/or Service (12b-1) Fees                                                  .30%    .50%    .25%   None  
Other Expenses:                                                                                                        
  Transfer Agent                                                                          .17%    .26%    .20%    .11% 
  Interest Expense and Related Expenses                                                   .06%    .03%    .06%    .12% 
  Other Expenses                                                                          .13%    .13%    .13%    .13% 
                                                                                         ----    ----    ----    ----  
Total Other Expenses                                                                      .36%    .42%    .39%    .36% 
                                                                                         ----    ----    ----    ----  
Total Annual Fund Operating Expenses                                                     1.11%   1.37%   1.09%    .81% 
                                                                                         ====    ====    ====    ====  
Fee Waiver and/or Expense Reimbursement (b)                                              (.20)%  (.29)%  (.23)%  (.14)%
                                                                                         ----    ----    ----    ----  
Total Annual Fund Operating Expenses After Fee Waiver and/or Expense Reimbursement (c)    .91%   1.08%    .86%    .67% 
                                                                                         ====    ====    ====    ====  
-----------------------------------------------------------------------------------------------------------------------

(a)In some cases, a 1%, 1-year contingent deferred sales charge, or CDSC, may   
apply for Class A shares.                                                 

(b)The fee waiver and/or expense reimbursements will remain in effect until     
January 31, 2012 and will continue thereafter from year-to-year unless the
Adviser provides notice of termination 60 days prior to the end of the    
Fund's fiscal year.                                                       

(c)If interest expenses were excluded, net expenses would be as follows:        

                                                                [Download Table]

CLASS A CLASS R CLASS K CLASS I
-------------------------------
                               
 .85%    1.05%    .80%    .55% 

EXAMPLES                                                                        
The Examples are intended to help you compare the cost of investing in the Fund 
with the cost of investing in other mutual funds. The Examples assume that you  
invest $10,000 in the Fund for the time periods indicated and then redeem all   
of your shares at the end of those periods. The Examples also assume that your  
investment has a 5% return each year, that the Fund's operating expenses stay   
the same and that the fee waiver is in effect for only the first year. Although 
your actual costs may be higher or lower, based on these assumptions your costs 
would be:                                                                       

                                                                [Download Table]

                CLASS A CLASS R CLASS K CLASS I
-----------------------------------------------
                                               
After 1 Year    $   93  $  110  $   88   $ 68  
After 3 Years   $  333  $  405  $  324   $245  
After 5 Years   $  592  $  722  $  579   $436  
After 10 Years  $1,334  $1,621  $1,308   $989  
-----------------------------------------------

4                                                                               

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PORTFOLIO TURNOVER                                                              
The Fund will pay transaction costs, such as commissions, when it buys or sells 
securities (or "turns over" its portfolio). A higher portfolio turnover may     
indicate higher transaction costs and may result in higher taxes when Fund      
shares are held in a taxable account. These transaction costs, which are not    
reflected in the Annual Fund Operating Expenses or in the Examples, affect the  
Fund's performance. During the most recent fiscal year, the Fund's portfolio    
turnover rate was 99% of the average value of its portfolio.                    

PRINCIPAL STRATEGIES                                                            
The Fund invests, under normal circumstances, at least 80% of its net assets in 
fixed-income securities. The Fund expects to invest in readily marketable       
fixed-income securities with a range of maturities from short- to long-term and 
relatively attractive yields that do not involve undue risk of loss of capital. 
The Fund expects to invest in fixed-income securities with a dollar-weighted    
average maturity of between three to ten years and an average duration of three 
to six years. The Fund may invest up to 25% of its net assets in below          
investment grade bonds. The Fund may use leverage for investment purposes.      

The Fund may invest without limit in U.S. Dollar-denominated foreign            
fixed-income securities and may invest up to 25% of its assets in               
non-U.S. Dollar-denominated foreign fixed-income securities. These investments  
may include, in each case, developed and emerging market debt securities.       

The Adviser selects securities for purchase or sale based on its assessment of  
the securities' risk and return characteristics as well as the securities'      
impact on the overall risk and return characteristics of the Fund. In making    
this assessment, the Adviser takes into account various factors including the   
credit quality and sensitivity to interest rates of the securities under        
consideration and of the Fund's other holdings.                                 

The Fund may invest in mortgage-related and other asset-backed securities, loan 
participations, inflation-protected securities, structured securities,          
variable, floating, and inverse floating rate instruments and preferred stock,  
and may use other investment techniques. The Fund intends, among other things,  
to enter into transactions such as reverse repurchase agreements and dollar     
rolls. The Fund may invest, without limit, in derivatives, such as options,     
futures, forwards, or swap agreements.                                          

The Fund expects to engage in active and frequent trading of portfolio          
securities to achieve its principal investment strategies. A higher rate of     
portfolio turnover increases transaction expenses, which may negatively affect  
the Fund's performance. High portfolio turnover also may result in the          
realization of substantial net short-term capital gains, which, when            
distributed, are taxable to shareholders.                                       

PRINCIPAL RISKS                                                                 
..  MARKET RISK: The value of the Fund's assets will fluctuate as the stock or  
 bond market fluctuates. The value of its investments may decline, sometimes
rapidly and unpredictably, simply because of economic changes or other    
events that affect large portions of the market.                          

..  INTEREST RATE RISK: Changes in interest rates will affect the value of      
 investments in fixed-income securities. When interest rates rise, the value
  of investments in fixed-income securities tends to fall and this decrease in
  value may not be offset by higher income from new investments. Interest rate
  risk is generally greater for fixed-income securities with longer maturities
or durations.                                                             

..  CREDIT RISK: An issuer or guarantor of a fixed-income security, or the      
 counterparty to a derivatives or other contract, may be unable or unwilling
 to make timely payments of interest or principal, or to otherwise honor its
 obligations. The issuer or guarantor may default causing a loss of the full
  principal amount of a security. The degree of risk for a particular security
may be reflected in its credit rating. There is the possibility that the  
credit rating of a fixed-income security may be downgraded after purchase,
which may adversely affect the value of the security.                     

..  BELOW INVESTMENT GRADE SECURITIES: Investments in fixed-income securities   
with lower ratings (commonly known as "junk bonds") tend to have a higher 
probability that an issuer will default or fail to meet its payment       
  obligations. These securities may be subject to greater price volatility due
to such factors as specific corporate developments, interest rate         
  sensitivity, negative perceptions of the junk bond market generally and less
secondary market liquidity.                                               

..  INFLATION RISK: This is the risk that the value of assets or income from    
investments will be less in the future as inflation decreases the value of
  money. As inflation increases, the value of the Fund's assets can decline as
can the value of the Fund's distributions. This risk is significantly     
greater if the Fund invests a significant portion of its assets in        
fixed-income securities with longer maturities.                           

..  FOREIGN (NON-U.S.) RISK: Investments in securities of non-U.S. issuers may  
  involve more risk than those of U.S. issuers. These securities may fluctuate
  more widely in price and may be less liquid due to adverse market, economic,
political, regulatory or other factors.                                   

                                                                           5

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..  EMERGING MARKET RISK: Investments in emerging market countries may have more
  risk because the markets are less developed and less liquid as well as being
  subject to increased economic, political, regulatory or other uncertainties.

..  CURRENCY RISK: Fluctuations in currency exchange rates may negatively affect
the value of the Fund's investments or reduce its returns.                

..  PREPAYMENT RISK: The value of mortgage-related or asset-backed securities   
  may be particularly sensitive to changes in prevailing interest rates. Early
payments of principal on some mortgage-related securities may occur during
periods of falling mortgage interest rates and expose the Fund to a lower 
rate of return upon reinvestment of principal. Early payments associated  
with mortgage-related securities cause these securities to experience     
significantly greater price and yield volatility than is experienced by   
traditional fixed-income securities. During periods of rising interest    
rates, a reduction in prepayments may increase the effective life of      
mortgage-related securities, subjecting them to greater risk of decline in
market value in response to rising interest rates. If the life of a       
mortgage-related security is inaccurately predicted, the Fund may not be  
able to realize the rate of return it expected.                           

..  DERIVATIVES RISK: Investments in derivatives may be illiquid, difficult to  
price, and leveraged so that small changes may produce disproportionate   
losses for the Fund, and may be subject to counterparty risk to a greater 
degree than more traditional investments.                                 

..  MANAGEMENT RISK: The Fund is subject to management risk because it is an    
actively managed investment fund. The Adviser will apply its investment   
  techniques and risk analyses in making investment decisions, but there is no
guarantee that its techniques will produce the intended results.          

As with all investments, you may lose money by investing in the Fund.           

BAR CHART AND PERFORMANCE INFORMATION                                           
The bar chart and performance information provide an indication of the          
historical risk of an investment in the Fund by showing:                        

..  how the Fund's performance changed from year to year over ten years; and    

..  how the Fund's average annual returns for one, five and ten years compare to
those of a broad-based securities market index.                           

You may obtain updated performance information on the Fund's website at         
www.AllianceBernstein.com (click on "Pricing & Performance").                   

The Fund's past performance, of course, does not necessarily indicate how it    
will perform in the future.                                                     

BAR CHART                                                                       
The annual returns in the bar chart are for the Fund's Class A shares and do    
not reflect sales loads. If sales loads were reflected, returns would be less   
than those shown.                                                               

[CHART]           

01     02     03     04     05     06     07     08     09     10           
----   ----   ----   ----   ----   ----   ----  -----  -----   ----           
7.36   7.67   3.69   3.48   1.94   3.97   5.68  -8.26  19.18   9.20           

Calendar Year End (%)         

During the period shown in the bar chart, the Fund's:                           

BEST QUARTER WAS UP 7.86% IN THE 3RD QUARTER, 2009; AND WORST QUARTER WAS DOWN  
-4.57% IN THE 3RD QUARTER, 2008.                                                

6                                                                               

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PERFORMANCE TABLE                                                               
AVERAGE ANNUAL TOTAL RETURNS                                                    
(For the periods ended December 31, 2010)                                       

                                                                [Download Table]

                                                      1 YEAR 5 YEARS* 10 YEARS*
-------------------------------------------------------------------------------
                                                                               
Class A                                               8.20%   5.58%     5.19%  
-------------------------------------------------------------------------------
Class R                                               8.99%   5.36%     4.98%  
-------------------------------------------------------------------------------
Class K                                               9.25%   5.61%     5.24%  
-------------------------------------------------------------------------------
Class I                                               9.52%   5.89%     5.51%  
-------------------------------------------------------------------------------
Barclays Capital U.S. Aggregate Index                                          
(reflects no deduction for fees, expenses, or taxes)  6.54%   5.80%     5.84%  
-------------------------------------------------------------------------------

* Inception Dates for Class R shares: 11/03/03, and Class K and Class I shares: 
3/1/05. Performance information for periods prior to the inception of Class 
 R, Class K and Class I shares is the performance of the Fund's Class A shares
adjusted to reflect the higher expense ratio of Class R shares and the lower
expense ratio of Class K and Class I shares, respectively.                  

INVESTMENT ADVISER                                                              
AllianceBernstein L.P. is the investment adviser for the Fund.                  

PORTFOLIO MANAGER                                                               
The following table lists the persons responsible for day-to-day management of  
the Fund's portfolio:                                                           

                                                                [Download Table]

EMPLOYEE            LENGTH OF SERVICE  TITLE                               
---------------------------------------------------------------------------
                                                                           
Paul J. DeNoon         Since 2009      Senior Vice President of the Adviser

Shawn E. Keegan        Since 2005      Vice President of the Adviser       

Alison M. Martier      Since 2005      Senior Vice President of the Adviser

Douglas J. Peebles     Since 2007      Senior Vice President of the Adviser

Greg J. Wilensky       Since 2005      Senior Vice President of the Adviser

ADDITIONAL INFORMATION                                                          
For important information about the purchase and sale of Fund shares, tax       
information and financial intermediary compensation, please turn to ADDITIONAL  
INFORMATION ABOUT PURCHASE AND SALE OF FUND SHARES, TAXES AND FINANCIAL         
INTERMEDIARIES, page 20 in this Prospectus.                                     

                                                                           7

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ALLIANCEBERNSTEIN GLOBAL BOND FUND                                              
--------------------------------------------------------------------------------

INVESTMENT OBJECTIVE                                                            
The Fund's investment objective is to generate current income consistent with   
preservation of capital.                                                        

FEES AND EXPENSES OF THE FUND                                                   
This table describes the fees and expenses that you may pay if you buy and hold 
shares of the Fund.                                                             

SHAREHOLDER FEES (fees paid directly from your investment)                      

                                                        [Enlarge/Download Table]

                                                                                CLASS A  CLASS R CLASS K CLASS I
                                                                                SHARES   SHARES  SHARES  SHARES 
----------------------------------------------------------------------------------------------------------------
                                                                                                                
Maximum Sales Charge (Load) Imposed on Purchases                                                                
(as a percentage of offering price)                                              None     None    None    None  
----------------------------------------------------------------------------------------------------------------
Maximum Deferred Sales Charge (Load)                                                                            
(as a percentage of offering price or redemption proceeds, whichever is lower)   None(a)  None    None    None  
----------------------------------------------------------------------------------------------------------------
Exchange Fee                                                                     None     None    None    None  

ANNUAL FUND OPERATING EXPENSES (expenses that you pay each year as a percentage 
of the value of your investment)                                                

                                                        [Enlarge/Download Table]
                                                                                                                      
----------------------------------------------------------------------------------------------------------------------
                                                                                       CLASS A CLASS R CLASS K CLASS I
----------------------------------------------------------------------------------------------------------------------
Management Fees                                                                          .50%    .50%    .50%    .50% 
Distribution and/or Service (12b-1) Fees                                                 .30%    .50%    .25%   None  
Other Expenses:                                                                                                       
  Transfer Agent                                                                         .10%    .24%    .20%    .02% 
  Interest Expense and Related Expenses                                                  .08%    .05%    .05%    .06% 
  Other Expenses                                                                         .04%    .06%    .06%    .05% 
                                                                                        ----    ----    ----    ----  
Total Other Expenses                                                                     .22%    .35%    .31%    .13% 
                                                                                        ----    ----    ----    ----  
Total Annual Fund Operating Expenses                                                    1.02%   1.35%   1.06%    .63% 
                                                                                        ====    ====    ====    ====  
Fee Waiver and/or Expense Reimbursement(b)                                              (.04)%  (.20)%  (.16)%  (.00)%
                                                                                        ----    ----    ----    ----  
Total Annual Fund Operating Expenses After Fee Waiver and/or Expense Reimbursement(c)    .98%   1.15%    .90%    .63% 
                                                                                        ====    ====    ====    ====  
----------------------------------------------------------------------------------------------------------------------

(a)In some cases, a 1%, 1-year CDSC may apply for Class A shares.               

(b)The fee waiver and/or expense reimbursements will remain in effect until     
January 31, 2012 and will continue thereafter from year-to-year unless the
Adviser provides notice of termination 60 days prior to the end of the    
Fund's fiscal year.                                                       

(c)If interest expenses were excluded, net expenses would be as follows:        

                                                                [Download Table]

CLASS A CLASS R CLASS K CLASS I
-------------------------------
                               
 .90%    1.10%   .85%    .57%  

EXAMPLES                                                                        
The Examples are intended to help you compare the cost of investing in the Fund 
with the cost of investing in other mutual funds. The Examples assume that you  
invest $10,000 in the Fund for the time periods indicated and then redeem all   
of your shares at the end of those periods. The Examples also assume that your  
investment has a 5% return each year, that the Fund's operating expenses stay   
the same and that the fee waiver is in effect for only the first year. Although 
your actual costs may be higher or lower, based on these assumptions your costs 
would be:                                                                       

                                                                [Download Table]

                CLASS A CLASS R CLASS K CLASS I
-----------------------------------------------
                                               
After 1 Year    $  100  $  117  $   92   $ 64  
After 3 Years   $  321  $  408  $  321   $202  
After 5 Years   $  559  $  720  $  569   $351  
After 10 Years  $1,244  $1,606  $1,280   $786  
-----------------------------------------------

8                                                                               

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PORTFOLIO TURNOVER                                                              
The Fund will pay transaction costs, such as commissions, when it buys or sells 
securities (or "turns over" its portfolio). A higher portfolio turnover may     
indicate higher transaction costs and may result in higher taxes when Fund      
shares are held in a taxable account. These transaction costs, which are not    
reflected in the Annual Fund Operating Expenses or in the Examples, affect the  
Fund's performance. During the most recent fiscal year, the Fund's portfolio    
turnover rate was 69% of the average value of its portfolio.                    

PRINCIPAL STRATEGIES                                                            
The Fund invests, under normal circumstances, at least 80% of its net assets in 
fixed-income securities. Under normal market conditions, the Fund invests       
significantly in fixed-income securities of non-U.S. companies. In addition,    
the Fund invests, under normal circumstances, in the fixed-income securities of 
companies located in at least three countries. The Fund may invest in a broad   
range of fixed-income securities in both developed and emerging markets. The    
Fund may invest across all fixed-income sectors, including U.S. and non-U.S.    
government and corporate debt securities. The Fund's investments may be         
denominated in local currency or U.S. Dollar-denominated. The Fund may invest   
in debt securities with a range of maturities from short- to long-term. The     
Fund may use borrowings or other leverage for investment purposes.              

The Adviser selects securities for purchase or sale based on its assessment of  
the securities' risk and return characteristics as well as the securities'      
impact on the overall risk and return characteristics of the Fund. In making    
this assessment, the Adviser takes into account various factors including the   
credit quality and sensitivity to interest rates of the securities under        
consideration and of the Fund's other holdings.                                 

The Adviser will actively manage the Fund's assets in relation to market        
conditions and general economic conditions and adjust the Fund's investments in 
an effort to best enable the Fund to achieve its investment objective. Thus,    
the percentage of the Fund's assets invested in a particular country or         
denominated in a particular currency will vary in accordance with the Adviser's 
assessment of the relative yield and appreciation potential of such securities  
and the relationship of the country's currency to the U.S. Dollar.              

Under normal circumstances, the Fund invests at least 75% of its net assets in  
fixed-income securities rated investment grade at the time of investment and    
may invest up to 25% of its net assets in below investment grade fixed-income   
securities.                                                                     

The Fund may invest in mortgage-related and other asset-backed securities, loan 
participations, inflation-protected securities, structured securities,          
variable, floating, and inverse floating rate instruments and preferred stock,  
and may use other investment techniques. The Fund intends, among other things,  
to enter into transactions such as reverse repurchase agreements and dollar     
rolls. The Fund may invest, without limit, in derivatives, such as options,     
futures, forwards, or swap agreements.                                          

PRINCIPAL RISKS                                                                 
..  MARKET RISK: The value of the Fund's assets will fluctuate as the stock or  
 bond market fluctuates. The value of its investments may decline, sometimes
rapidly and unpredictably, simply because of economic changes or other    
events that affect large portions of the market.                          

..  INTEREST RATE RISK: Changes in interest rates will affect the value of      
 investments in fixed-income securities. When interest rates rise, the value
  of investments in fixed-income securities tends to fall and this decrease in
  value may not be offset by higher income from new investments. Interest rate
  risk is generally greater for fixed-income securities with longer maturities
or durations.                                                             

..  CREDIT RISK: An issuer or guarantor of a fixed-income security, or the      
 counterparty to a derivatives or other contract, may be unable or unwilling
 to make timely payments of interest or principal, or to otherwise honor its
 obligations. The issuer or guarantor may default causing a loss of the full
  principal amount of a security. The degree of risk for a particular security
may be reflected in its credit rating. There is the possibility that the  
credit rating of a fixed-income security may be downgraded after purchase,
which may adversely affect the value of the security.                     

..  BELOW INVESTMENT GRADE SECURITIES: Investments in fixed-income securities   
with lower ratings (commonly known as "junk bonds") tend to have a higher 
probability that an issuer will default or fail to meet its payment       
  obligations. These securities may be subject to greater price volatility due
to such factors as specific corporate developments, interest rate         
  sensitivity, negative perceptions of the junk bond market generally and less
secondary market liquidity.                                               

..  INFLATION RISK: This is the risk that the value of assets or income from    
investments will be less in the future as inflation decreases the value of
  money. As inflation increases, the value of the Fund's assets can decline as
can the value of the Fund's distributions. This risk is significantly     
greater if the Fund invests a significant portion of its assets in        
fixed-income securities with longer maturities.                           

..  FOREIGN (NON-U.S.) RISK: Investments in securities of non-U.S. issuers may  
  involve more risk than those of U.S. issuers. These securities may fluctuate
  more widely in price and may be less liquid due to adverse market, economic,
political, regulatory or other factors.                                   

                                                                           9

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..  EMERGING MARKET RISK: Investments in emerging market countries may have more
  risk because the markets are less developed and less liquid as well as being
  subject to increased economic, political, regulatory or other uncertainties.

..  CURRENCY RISK: Fluctuations in currency exchange rates may negatively affect
the value of the Fund's investments or reduce its returns.                

..  LEVERAGE RISK: To the extent the Fund uses leveraging techniques, its net   
asset value, or NAV, may be more volatile because leverage tends to       
exaggerate the effect of changes in interest rates and any increase or    
decrease in the value of the Fund's investments.                          

..  DIVERSIFICATION RISK: The Fund may have more risk because it is             
"non-diversified," meaning that it can invest more of its assets in a     
smaller number of issuers and that adverse changes in the value of one    
security could have a more significant effect on the Fund's NAV.          

..  DERIVATIVES RISK: Investments in derivatives may be illiquid, difficult to  
price, and leveraged so that small changes may produce disproportionate   
losses for the Fund, and may be subject to counterparty risk to a greater 
degree than more traditional investments.                                 

..  MANAGEMENT RISK: The Fund is subject to management risk because it is an    
actively managed investment fund. The Adviser will apply its investment   
  techniques and risk analyses in making investment decisions, but there is no
guarantee that its techniques will produce the intended results.          

As with all investments, you may lose money by investing in the Fund.           

BAR CHART AND PERFORMANCE INFORMATION                                           
The bar chart and performance information provide an indication of the          
historical risk of an investment in the Fund by showing:                        

..  how the Fund's performance changed from year to year over ten years; and    

..  how the Fund's average annual returns for one, five and ten years compare to
those of a broad-based securities market index.                           

You may obtain updated performance information on the Fund's website at         
www.AllianceBernstein.com (click on "Pricing & Performance").                   

The Fund's past performance, of course, does not necessarily indicate how it    
will perform in the future.                                                     

BAR CHART                                                                       
The annual returns in the bar chart are for the Fund's Class A shares and do    
not reflect sales loads. If sales loads were reflected, returns would be less   
than those shown.                                                               

[CHART]             

01     02     03     04     05     06     07     08      09     10            
----  -----  -----   ----   ----   ----   ----  ------  -----   ----            
0.31  10.68  15.13   6.87   9.71   6.57   9.90  -10.71  23.96   9.53            

Calendar Year End (%)       

During the period shown in the bar chart, the Fund's:                           

BEST QUARTER WAS UP 11.30% IN THE 2ND QUARTER, 2009; AND WORST QUARTER WAS DOWN 
-5.57% IN THE 4TH QUARTER, 2008.                                                

10                                                                              

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PERFORMANCE TABLE                                                               
AVERAGE ANNUAL TOTAL RETURNS                                                    
(For the periods ended December 31, 2010)                                       

                                                                [Download Table]

                                                       1 YEAR 5 YEARS* 10 YEARS*
--------------------------------------------------------------------------------
                                                                                
Class A                                                 8.53%  7.26%     7.84%  
--------------------------------------------------------------------------------
Class R                                                 9.30%  7.18%     7.49%  
--------------------------------------------------------------------------------
Class K                                                 9.59%  7.33%     7.90%  
--------------------------------------------------------------------------------
Class I                                                10.04%  7.60%     8.18%  
--------------------------------------------------------------------------------
Barclays Capital Global Aggregate Index (U.S. hedged)                           
(reflects no deduction for fees, expenses, or taxes)   -1.33%  3.50%     4.33%  
--------------------------------------------------------------------------------

* Inception dates for Class R, Class K and Class I shares: 11/5/07. Performance 
information for periods prior to the inception of Class R, Class K and Class
I shares is the performance of the Fund's Class A shares adjusted to reflect
the higher expense ratio of Class R shares and the lower expense ratio of   
Class K and Class I shares, respectively.                                   

INVESTMENT ADVISER                                                              
AllianceBernstein L.P. is the investment adviser for the Fund.                  

PORTFOLIO MANAGER                                                               
The following table lists the persons responsible for day-to-day management of  
the Fund's portfolio:                                                           

                                                                [Download Table]

EMPLOYEE             LENGTH OF SERVICE  TITLE                                
-----------------------------------------------------------------------------
                                                                             
Paul J. DeNoon          Since 2002      Senior Vice President of the Adviser 

Scott DiMaggio          Since 2005      Senior Vice President of the Adviser 

Michael L. Mon          Since 2003      Vice President of the Adviser        

Douglas J. Peebles      Since 1992      Senior Vice President of the Adviser 

Matthew S. Sheridan     Since 2007      Vice President of the Adviser        

ADDITIONAL INFORMATION                                                          
For important information about the purchase and sale of Fund shares, tax       
information and financial intermediary compensation, please turn to ADDITIONAL  
INFORMATION ABOUT PURCHASE AND SALE OF FUND SHARES, TAXES AND FINANCIAL         
INTERMEDIARIES, page 20 in this Prospectus.                                     

                                                                            11

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ALLIANCEBERNSTEIN DIVERSIFIED YIELD FUND                                        
--------------------------------------------------------------------------------

INVESTMENT OBJECTIVE                                                            
The Fund's investment objective is to generate current income consistent with   
preservation of capital.                                                        

FEES AND EXPENSES OF THE FUND                                                   
This table describes the fees and expenses that you may pay if you buy and hold 
shares of the Fund.                                                             

SHAREHOLDER FEES (fees paid directly from your investment)                      

                                                        [Enlarge/Download Table]

                                                                                CLASS A  CLASS R CLASS K CLASS I
                                                                                SHARES   SHARES  SHARES  SHARES 
----------------------------------------------------------------------------------------------------------------
                                                                                                                
Maximum Sales Charge (Load) Imposed on Purchases                                                                
(as a percentage of offering price)                                              None     None    None    None  
----------------------------------------------------------------------------------------------------------------
Maximum Deferred Sales Charge (Load)                                                                            
(as a percentage of offering price or redemption proceeds, whichever is lower)   None(a)  None    None    None  
----------------------------------------------------------------------------------------------------------------
Exchange Fee                                                                     None     None    None    None  

ANNUAL FUND OPERATING EXPENSES (expenses that you pay each year as a percentage 
of the value of your investment)                                                

                                                        [Enlarge/Download Table]

                                                                                    CLASS A CLASS R CLASS K CLASS I
-------------------------------------------------------------------------------------------------------------------
                                                                                                                   
Management Fees                                                                       .50%    .50%    .50%    .50% 
Distribution and/or Service (12b-1) Fees                                              .30%    .50%    .25%    None 
Other Expenses:                                                                                                    
  Transfer Agent                                                                      .12%    .26%    .19%    .05% 
  Other Expenses                                                                      .63%    .62%    .35%    .63% 
                                                                                    ------  ------  ------  ------ 
Total Other Expenses                                                                  .75%    .88%    .54%    .68% 
                                                                                    ------  ------  ------  ------ 
Total Annual Fund Operating Expenses                                                 1.55%   1.88%   1.29%   1.18% 
                                                                                    ======  ======  ======  ====== 
Fee Waiver and/or Expense Reimbursement(b)                                          (.65)%  (.78)%  (.44)%  (.58)% 
                                                                                    ------  ------  ------  ------ 
Total Annual Fund Operating Expenses After Fee Waiver and/or Expense Reimbursement    .90%   1.10%    .85%    .60% 
                                                                                    ======  ======  ======  ====== 
-------------------------------------------------------------------------------------------------------------------

(a)In some cases, a 1%, 1-year CDSC may apply for Class A shares.               

(b)The fee waiver and/or expense reimbursements will remain in effect until     
January 31, 2012 and will continue thereafter from year-to-year unless the
Adviser provides notice of termination 60 days prior to the end of the    
Fund's fiscal year.                                                       

EXAMPLES                                                                        
The Examples are intended to help you compare the cost of investing in the Fund 
with the cost of investing in other mutual funds. The Examples assume that you  
invest $10,000 in the Fund for the time periods indicated and then redeem all   
of your shares at the end of those periods. The Examples also assume that your  
investment has a 5% return each year, that the Fund's operating expenses stay   
the same and that the fee waiver is in effect for only the first year. Although 
your actual costs may be higher or lower, based on these assumptions your costs 
would be:                                                                       

                                                                [Download Table]

                CLASS A CLASS R CLASS K CLASS I
-----------------------------------------------
                                               
After 1 Year    $   92  $  112  $   87  $   61 
After 3 Years   $  426  $  515  $  366  $  317 
After 5 Years   $  783  $  944  $  665  $  593 
After 10 Years  $1,790  $2,137  $1,518  $1,380 
-----------------------------------------------

PORTFOLIO TURNOVER                                                              
The Fund will pay transaction costs, such as commissions, when it buys or sells 
securities (or "turns over" its portfolio). A higher portfolio turnover may     
indicate higher transaction costs and may result in higher taxes when Fund      
shares are held in a taxable account. These transaction costs, which are not    
reflected in the Annual Fund Operating Expenses or in the Examples, affect the  
Fund's performance. During the most recent fiscal year, the Fund's portfolio    
turnover rate was 54% of the average value of its portfolio.                    

12                                                                              

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PRINCIPAL STRATEGIES                                                            
The Fund employs a dynamic risk allocation, meaning that the Fund's risk        
profile may vary significantly over time based upon market conditions. The Fund 
invests in a portfolio of fixed-income securities of U.S. and non-U.S.          
companies, U.S. and non-U.S. government entities and supranational entities,    
including lower-rated securities. The Fund limits its investments in the        
securities of any one non-U.S. government to 25% of its total assets. The Fund  
may invest in debt securities with a range of maturities from short- to         
long-term.                                                                      

The Adviser selects securities for purchase or sale based on its assessment of  
the securities' risk and return characteristics as well as the securities'      
impact on the overall risk and return characteristics of the Fund. In making    
this assessment, the Adviser takes into account various factors including the   
credit quality and sensitivity to interest rates of the securities under        
consideration and of the Fund's other holdings.                                 

The Fund typically maintains at least 50% of its net assets in investment grade 
securities. The Fund may invest up to 50% of its net assets in below investment 
grade securities, such as corporate high yield fixed-income securities,         
sovereign debt obligations and fixed-income securities of issuers located in    
emerging markets.                                                               

The Fund may also invest in mortgage-related and other asset-backed securities, 
loan participations, inflation-protected securities, structured securities,     
variable, floating, and inverse floating rate instruments and preferred stock,  
and may use other investment techniques. The Fund may make short sales of       
securities or currencies or maintain a short position. The Fund may use         
borrowings or other leverage for investment purposes. The Fund intends, among   
other things, to enter into transactions such as reverse repurchase agreements  
and dollar rolls. The Fund may invest, without limit, in derivatives, such as   
options, futures, forwards, or swap agreements.                                 

PRINCIPAL RISKS                                                                 
..  MARKET RISK: The value of the Fund's assets will fluctuate as the stock or  
 bond market fluctuates. The value of its investments may decline, sometimes
rapidly and unpredictably, simply because of economic changes or other    
events that affect large portions of the market.                          

..  INTEREST RATE RISK: Changes in interest rates will affect the value of      
 investments in fixed-income securities. When interest rates rise, the value
  of investments in fixed-income securities tends to fall and this decrease in
  value may not be offset by higher income from new investments. Interest rate
  risk is generally greater for fixed-income securities with longer maturities
or durations.                                                             

..  CREDIT RISK: An issuer or guarantor of a fixed-income security, or the      
 counterparty to a derivatives or other contract, may be unable or unwilling
 to make timely payments of interest or principal, or to otherwise honor its
 obligations. The issuer or guarantor may default causing a loss of the full
  principal amount of a security. The degree of risk for a particular security
may be reflected in its credit rating. There is the possibility that the  
credit rating of a fixed-income security may be downgraded after purchase,
which may adversely affect the value of the security.                     

..  BELOW INVESTMENT GRADE SECURITIES: Investments in fixed-income securities   
with lower ratings (commonly known as "junk bonds") tend to have a higher 
probability that an issuer will default or fail to meet its payment       
  obligations. These securities may be subject to greater price volatility due
to such factors as specific corporate developments, interest rate         
  sensitivity, negative perceptions of the junk bond market generally and less
secondary market liquidity.                                               

..  INFLATION RISK: This is the risk that the value of assets or income from    
investments will be less in the future as inflation decreases the value of
  money. As inflation increases, the value of the Fund's assets can decline as
can the value of the Fund's distributions. This risk is significantly     
greater if the Fund invests a significant portion of its assets in        
fixed-income securities with longer maturities.                           

..  FOREIGN (NON-U.S.) RISK: Investments in securities of non-U.S. issuers may  
  involve more risk than those of U.S. issuers. These securities may fluctuate
  more widely in price and may be less liquid due to adverse market, economic,
political, regulatory or other factors.                                   

..  EMERGING MARKET RISK: Investments in emerging market countries may have more
  risk because the markets are less developed and less liquid as well as being
  subject to increased economic, political, regulatory or other uncertainties.

..  CURRENCY RISK: Fluctuations in currency exchange rates may negatively affect
the value of the Fund's investments or reduce its returns.                

..  LEVERAGE RISK: To the extent the Fund uses leveraging techniques, its NAV   
may be more volatile because leverage tends to exaggerate the effect of   
changes in interest rates and any increase or decrease in the value of the
Fund's investments.                                                       

..  PREPAYMENT RISK: The value of mortgage-related or asset-backed securities   
  may be particularly sensitive to changes in prevailing interest rates. Early
payments of principal on some mortgage-related securities may occur during
periods of falling mortgage interest rates and expose the Fund to a lower 
   rate of return upon reinvestment of principal. Early payments associated with

                                                                            13

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mortgage-related securities cause these securities to experience significantly
greater price and yield volatility than is experienced by traditional         
fixed-income securities. During periods of rising interest rates, a reduction 
in prepayments may increase the effective life of mortgage-related securities,
subjecting them to greater risk of decline in market value in response to     
rising interest rates. If the life of a mortgage-related security is          
inaccurately predicted, the Fund may not be able to realize the rate of return
it expected.                                                                  

..  DERIVATIVES RISK: Investments in derivatives may be illiquid, difficult to  
price, and leveraged so that small changes may produce disproportionate   
losses for the Fund, and may be subject to counterparty risk to a greater 
degree than more traditional investments.                                 

..  MANAGEMENT RISK: The Fund is subject to management risk because it is an    
actively managed investment fund. The Adviser will apply its investment   
  techniques and risk analyses in making investment decisions, but there is no
guarantee that its techniques will produce the intended results.          

As with all investments, you may lose money by investing in the Fund.           

BAR CHART AND PERFORMANCE INFORMATION                                           
The bar chart and performance information provide an indication of the          
historical risk of an investment in the Fund by showing:                        

..  how the Fund's performance changed from year to year over ten years; and    

..  how the Fund's average annual returns for one, five and ten years compare to
those of a broad-based securities market index.                           

You may obtain updated performance information on the Fund's website at         
www.AllianceBernstein.com (click on "Pricing & Performance").                   

The Fund's past performance, of course, does not necessarily indicate how it    
will perform in the future.                                                     

BAR CHART                                                                       
The annual returns in the bar chart are for the Fund's Class A shares and do    
not reflect sales loads. If sales loads were reflected, returns would be less   
than those shown.                                                               

[CHART]         

01     02     03     04     05     06     07     08      09     10          
-----   ----  -----   ----   ----   ----   ----  ------  -----   ----           
-2.81   5.04  15.61   6.13   4.81   4.46   6.38  -16.52  19.20   7.38           

Calendar Year End (%)       

During the period shown in the bar chart, the Fund's:                           

BEST QUARTER WAS UP 8.57% IN THE 2ND QUARTER, 2009; AND WORST QUARTER WAS DOWN  
-9.62% IN THE 4TH QUARTER, 2008.                                                

PERFORMANCE TABLE                                                               
AVERAGE ANNUAL TOTAL RETURNS                                                    
(For the periods ended December 31, 2010)                                       

                                                        [Enlarge/Download Table]

                                                                    1 YEAR 5 YEARS* 10 YEARS*
---------------------------------------------------------------------------------------------
                                                                                             
Class A                                                             6.38%   3.49%     4.54%  
---------------------------------------------------------------------------------------------
Class R                                                             7.28%   3.27%     4.31%  
---------------------------------------------------------------------------------------------
Class K                                                             7.63%   3.59%     4.61%  
---------------------------------------------------------------------------------------------
Class I                                                             7.76%   3.83%     4.86%  
---------------------------------------------------------------------------------------------
Barclays Capital Global Aggregate Index                                                      
(U.S. hedged) (reflects no deduction for fees, expenses, or taxes)  4.61%   4.85%     5.20%  
---------------------------------------------------------------------------------------------
BofA Merrill Lynch 3-Month T-Bill Index                             0.13%   2.43%     2.38%  
---------------------------------------------------------------------------------------------

* Inception Dates for Class R, Class K and Class I shares: 3/1/05. Performance  
information for periods prior to the inception of Class R, Class K and Class
I shares is the performance of the Fund's Class A shares adjusted to reflect
the higher expense ratio of Class R shares and the lower expense ratio of   
Class K and Class I shares, respectively.                                   

14                                                                              

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INVESTMENT ADVISER                                                              
AllianceBernstein L.P. is the investment adviser for the Fund.                  

PORTFOLIO MANAGER                                                               
The following table lists the persons responsible for day-to-day management of  
the Fund's portfolio:                                                           

                                                                [Download Table]

EMPLOYEE             LENGTH OF SERVICE  TITLE                                
-----------------------------------------------------------------------------
                                                                             
Paul J. DeNoon          Since 2005      Senior Vice President of the Adviser 

Joran Laird             Since 2009      Vice President of the Adviser        

Douglas J. Peebles      Since 1996      Senior Vice President of the Adviser 

Matthew S. Sheridan     Since 2006      Vice President of the Adviser        

Greg J. Wilensky        Since 2008      Senior Vice President of the Adviser 

ADDITIONAL INFORMATION                                                          
For important information about the purchase and sale of Fund shares, tax       
information and financial intermediary compensation, please turn to ADDITIONAL  
INFORMATION ABOUT PURCHASE AND SALE OF FUND SHARES, TAXES AND FINANCIAL         
INTERMEDIARIES, page 20 in this Prospectus.                                     

                                                                            15

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ALLIANCEBERNSTEIN HIGH INCOME FUND                                              
--------------------------------------------------------------------------------

INVESTMENT OBJECTIVE                                                            
The Fund's investment objective is to seek to maximize total returns from price 
appreciation and income.                                                        

FEES AND EXPENSES OF THE FUND                                                   
This table describes the fees and expenses that you may pay if you buy and hold 
shares of the Fund.                                                             

SHAREHOLDER FEES (fees paid directly from your investment)                      

                                                        [Enlarge/Download Table]

                                                                                CLASS A  CLASS R CLASS K CLASS I
                                                                                SHARES   SHARES  SHARES  SHARES 
----------------------------------------------------------------------------------------------------------------
                                                                                                                
Maximum Sales Charge (Load) Imposed on Purchases                                                                
(as a percentage of offering price)                                              None     None    None    None  
----------------------------------------------------------------------------------------------------------------
Maximum Deferred Sales Charge (Load)                                                                            
(as a percentage of offering price or redemption proceeds, whichever is lower)   None(a)  None    None    None  
----------------------------------------------------------------------------------------------------------------
Exchange Fee                                                                     None     None    None    None  

ANNUAL FUND OPERATING EXPENSES (expenses that you pay each year as a percentage 
of the value of your investment)                                                

                                                        [Enlarge/Download Table]

                                                                                       CLASS A CLASS R CLASS K CLASS I
                                                                                                                      
----------------------------------------------------------------------------------------------------------------------
Management Fees                                                                          .50%    .50%    .50%    .50% 
Distribution and/or Service (12b-1) Fees                                                 .30%    .50%    .25%   None  
Other Expenses:                                                                                                       
  Transfer Agent                                                                         .12%    .25%    .20%    .12% 
  Interest Expense and Related Expenses                                                  .04%    .03%    .05%    .02% 
Other Expenses                                                                           .08%    .09%    .08%    .08% 
                                                                                        ----    ----    ----    ----  
Total Other Expenses                                                                     .24%    .37%    .33%    .22% 
                                                                                        ----    ----    ----    ----  
Total Annual Fund Operating Expenses                                                    1.04%   1.37%   1.08%    .72% 
                                                                                        ====    ====    ====    ====  
  Fee Waiver and/or Expense Reimbursement(a)                                            (.05)%  (.19)%  (.13)%  (.05)%
                                                                                        ----    ----    ----    ----  
Total Annual Fund Operating Expenses After Fee Waiver and/or Expense Reimbursement(b)    .99%   1.18%    .95%    .67% 
                                                                                        ====    ====    ====    ====  
----------------------------------------------------------------------------------------------------------------------

(a)In some cases, a 1%, 1-year CDSC may apply for Class A shares.               

(b)The fee waiver and/or expense reimbursements will remain in effect until     
January 31, 2012 and will continue thereafter from year-to-year unless the
Adviser provides notice of termination 60 days prior to the end of the    
Fund's fiscal year.                                                       

(c)If interest expenses were excluded, net expenses would be as follows:        

                                                                [Download Table]

CLASS A CLASS R CLASS K CLASS I
-------------------------------
                               
 .95%    1.15%   .90%    .65%  

EXAMPLES                                                                        
The Examples are intended to help you compare the cost of investing in the Fund 
with the cost of investing in other mutual funds. The Examples assume that you  
invest $10,000 in the Fund for the time periods indicated and then redeem all   
of your shares at the end of those periods. The Examples also assume that your  
investment has a 5% return each year, that the Fund's operating expenses stay   
the same and that the fee waiver is in effect for only the first year. Although 
your actual costs may be higher or lower, based on these assumptions your costs 
would be:                                                                       

                                                                [Download Table]

                CLASS A CLASS R CLASS K CLASS I
-----------------------------------------------
                                               
After 1 Year    $  101  $  120  $   97   $ 68  
After 3 Years   $  326  $  416  $  331   $225  
After 5 Years   $  569  $  733  $  583   $396  
After 10 Years  $1,267  $1,632  $1,307   $890  
-----------------------------------------------

16                                                                              

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PORTFOLIO TURNOVER                                                              
The Fund will pay transaction costs, such as commissions, when it buys or sells 
securities (or "turns over" its portfolio). A higher portfolio turnover may     
indicate higher transaction costs and may result in higher taxes when Fund      
shares are held in a taxable account. These transaction costs, which are not    
reflected in the Annual Fund Operating Expenses or in the Examples, affect the  
Fund's performance. During the most recent fiscal year, the Fund's portfolio    
turnover rate was 26% of the average value of its portfolio.                    

PRINCIPAL STRATEGIES                                                            
The Fund pursues income opportunities from government, corporate, emerging      
market and high yield sources. It has the flexibility to invest in a broad      
range of fixed-income securities in both developed and emerging market          
countries. The Fund's investments may include U.S. and non-U.S. corporate debt  
securities and sovereign debt securities. The Fund may invest, without          
limitation, in either U.S. Dollar-denominated or non-U.S. Dollar-denominated    
fixed-income securities.                                                        

The Adviser selects securities for purchase or sale based on its assessment of  
the securities' risk and return characteristics as well as the securities'      
impact on the overall risk and return characteristics of the Fund. In making    
this assessment, the Adviser takes into account various factors including the   
credit quality and sensitivity to interest rates of the securities under        
consideration and of the Fund's other holdings.                                 

The Fund may invest in debt securities with a range of maturities from short-   
to long-term. Substantially all of the Fund's assets may be invested in         
lower-rated securities, which may include securities having the lowest rating   
for non-subordinated debt instruments (i.e., rated C by Moody's or CCC+ or      
lower by S&P and Fitch) and unrated securities of equivalent investment         
quality. The Fund also may invest in investment grade securities and unrated    
securities.                                                                     

The Fund may also make short sales of securities or maintain a short position.  
The Fund is non-diversified, meaning it may invest more of its assets in a      
fewer number of issuers.                                                        

The Fund may invest in mortgage-related and other asset-backed securities, loan 
participations, inflation-protected securities, structured securities,          
variable, floating, and inverse floating rate instruments and preferred stock,  
and may use other investment techniques. The Fund may use borrowings or other   
leverage for investment purposes. The Fund intends, among other things, to      
enter into transactions such as reverse repurchase agreements and dollar rolls. 
The Fund may invest, without limit, in derivatives, such as options, futures,   
forwards, or swap agreements.                                                   

PRINCIPAL RISKS                                                                 
..  MARKET RISK: The value of the Fund's assets will fluctuate as the stock or  
 bond market fluctuates. The value of its investments may decline, sometimes
rapidly and unpredictably, simply because of economic changes or other    
events that affect large portions of the market.                          

..  INTEREST RATE RISK: Changes in interest rates will affect the value of      
 investments in fixed-income securities. When interest rates rise, the value
  of investments in fixed-income securities tends to fall and this decrease in
  value may not be offset by higher income from new investments. Interest rate
  risk is generally greater for fixed-income securities with longer maturities
or durations.                                                             

..  CREDIT RISK: An issuer or guarantor of a fixed-income security, or the      
 counterparty to a derivatives or other contract, may be unable or unwilling
 to make timely payments of interest or principal, or to otherwise honor its
 obligations. The issuer or guarantor may default causing a loss of the full
  principal amount of a security. The degree of risk for a particular security
may be reflected in its credit rating. There is the possibility that the  
credit rating of a fixed-income security may be downgraded after purchase,
which may adversely affect the value of the security.                     

..  BELOW INVESTMENT GRADE SECURITIES: Investments in fixed-income securities   
with lower ratings (commonly known as "junk bonds") tend to have a higher 
probability that an issuer will default or fail to meet its payment       
  obligations. These securities may be subject to greater price volatility due
to such factors as specific corporate developments, interest rate         
  sensitivity, negative perceptions of the junk bond market generally and less
secondary market liquidity.                                               

..  INFLATION RISK: This is the risk that the value of assets or income from    
investments will be less in the future as inflation decreases the value of
  money. As inflation increases, the value of the Fund's assets can decline as
can the value of the Fund's distributions. This risk is significantly     
greater if the Fund invests a significant portion of its assets in        
fixed-income securities with longer maturities.                           

..  FOREIGN (NON-U.S.) RISK: Investments in securities of non-U.S. issuers may  
  involve more risk than those of U.S. issuers. These securities may fluctuate
  more widely in price and may be less liquid due to adverse market, economic,
political, regulatory or other factors.                                   

..  EMERGING MARKET RISK: Investments in emerging market countries may have more
  risk because the markets are less developed and less liquid as well as being
  subject to increased economic, political, regulatory or other uncertainties.

                                                                            17

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..  CURRENCY RISK: Fluctuations in currency exchange rates may negatively affect
the value of the Fund's investments or reduce its returns.                

..  LEVERAGE RISK: To the extent the Fund uses leveraging techniques, its NAV   
may be more volatile because leverage tends to exaggerate the effect of   
changes in interest rates and any increase or decrease in the value of the
Fund's investments.                                                       

..  DIVERSIFICATION RISK: The Fund may have more risk because it is             
"non-diversified," meaning that it can invest more of its assets in a     
smaller number of issuers and that adverse changes in the value of one    
security could have a more significant effect on the Fund's NAV.          

..  DERIVATIVES RISK: Investments in derivatives may be illiquid, difficult to  
price, and leveraged so that small changes may produce disproportionate   
losses for the Fund, and may be subject to counterparty risk to a greater 
degree than more traditional investments.                                 

..  MANAGEMENT RISK: The Fund is subject to management risk because it is an    
actively managed investment fund. The Adviser will apply its investment   
  techniques and risk analyses in making investment decisions, but there is no
guarantee that its techniques will produce the intended results.          

As with all investments, you may lose money by investing in the Fund.           

BAR CHART AND PERFORMANCE INFORMATION                                           
The bar chart and performance information provide an indication of the          
historical risk of an investment in the Fund by showing:                        

..  how the Fund's performance changed from year to year over ten years; and    

..  how the Fund's average annual returns for one, five and ten years compare to
those of a broad-based securities market index.                           

You may obtain updated performance information on the Fund's website at         
www.AllianceBernstein.com (click on "Pricing & Performance").                   

The Fund's past performance, of course, does not necessarily indicate how it    
will perform in the future.                                                     

BAR CHART                                                                       
The annual returns in the bar chart are for the Fund's Class A shares and do    
not reflect sales loads. If sales loads were reflected, returns would be less   
than those shown.                                                               

[CHART]             

01     02     03     04     05     06     07     08      09      10           
----  -----  -----  -----  -----  -----   ----  ------  -----   -----           
6.10  18.70  38.42  11.09  10.16  11.85   7.29  -26.52  61.74   16.80           

Calendar Year End (%)           

During the period shown in the bar chart, the Fund's:                           

BEST QUARTER WAS UP 23.96% IN THE 2ND QUARTER, 2009; AND WORST QUARTER WAS DOWN 
-17.75% IN THE 4TH QUARTER, 2008.                                               

18                                                                              

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PERFORMANCE TABLE                                                               
AVERAGE ANNUAL TOTAL RETURNS                                                    
(For the periods ended December 31, 2010)                                       

                                                        [Enlarge/Download Table]

                                                                                         1 YEAR 5 YEARS* 10 YEARS*
------------------------------------------------------------------------------------------------------------------
                                                                                                                  
Class A                                                                                  15.80%  10.75%   13.52%  
------------------------------------------------------------------------------------------------------------------
Class R                                                                                  16.58%  10.54%   13.30%  
------------------------------------------------------------------------------------------------------------------
Class K                                                                                  16.89%  10.82%   13.59%  
------------------------------------------------------------------------------------------------------------------
Class I                                                                                  17.31%  11.11%   13.87%  
------------------------------------------------------------------------------------------------------------------
JPMorgan Emerging Markets Bond Index Global ("EMBI Global") (U.S. Dollar-denominated)    12.04%   8.36%   10.29%  
------------------------------------------------------------------------------------------------------------------
JPMorgan Government Bond Index Emerging Markets ("GBI-EM") (local currency-denominated)                           
(reflects no deduction for fees, expenses, or taxes)                                     13.08%   9.82%      N/A  
------------------------------------------------------------------------------------------------------------------
Barclays Capital High Yield Index (2% Constrained) ("BC High Yield")                                              
(reflects no deduction for fees, expenses, or taxes)                                     14.94%   8.91%    9.01%  
------------------------------------------------------------------------------------------------------------------
Composite Benchmark                                                                                               
(equal weighted blend of EMBI Global, GBI-EM and BC High Yield)                          13.43%   9.19%      N/A  
------------------------------------------------------------------------------------------------------------------

* Inception date for Class R, Class K and Class I shares: 1/28/08. Performance  
information for periods prior to the inception of Class R, Class K and Class
I shares is the performance of the Class A shares adjusted to reflect the   
 higher expense ratio of Class R shares and the lower expense ratio of Class K
and Class I shares, respectively.                                           

INVESTMENT ADVISER                                                              
AllianceBernstein L.P. is the investment adviser for the Fund.                  

PORTFOLIO MANAGER                                                               
The following table lists the persons responsible for day-to-day management of  
the Fund's portfolio:                                                           

                                                                [Download Table]

EMPLOYEE               LENGTH OF SERVICE  TITLE                                
-------------------------------------------------------------------------------
                                                                               
Paul J. DeNoon            Since 2002      Senior Vice President of the Adviser 

Gershon M. Distenfeld     Since 2008      Senior Vice President of the Adviser 

Douglas J. Peebles        Since 2002      Senior Vice President of the Adviser 

Marco Santamaria          Since 2010      Vice President of the Adviser        

Matthew S. Sheridan       Since 2005      Vice President of the Adviser        

ADDITIONAL INFORMATION                                                          
For important information about the purchase and sale of Fund shares, tax       
information and financial intermediary compensation, please turn to ADDITIONAL  
INFORMATION ABOUT PURCHASE AND SALE OF FUND SHARES, TAXES AND FINANCIAL         
INTERMEDIARIES, page 20 in this Prospectus.                                     

                                                                            19

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ADDITIONAL INFORMATION ABOUT PURCHASE AND SALE OF FUND SHARES, TAXES AND        
FINANCIAL INTERMEDIARIES                                                        

.   PURCHASE AND SALE OF FUND SHARES                                  

PURCHASE MINIMUMS                                                               
Class A, Class R, Class K and Class I shares are available at NAV, without an   
initial sales charge, to 401(k) plans, 457 plans, employer-sponsored 403(b)     
plans, profit-sharing and money purchase pension plans, defined benefit plans,  
and non-qualified deferred compensation plans where plan level or omnibus       
accounts are held on the books of a Fund.                                       

You may sell (redeem) your shares each day the New York Stock Exchange is open. 
You may sell your shares through your financial intermediary.                   

.   TAX INFORMATION                                                   

Each Fund may make income dividends or capital gains distributions, which may   
be subject to federal income taxes and taxable as ordinary income or capital    
gains, and may also be subject to state and local taxes.                        

.   PAYMENTS TO FINANCIAL INTERMEDIARIES                              

Financial intermediaries market and sell shares of the Funds. A Fund and its    
related companies may pay the intermediary for the sale of Fund shares and      
related services. These payments may create a conflict of interest by           
influencing the financial intermediary to recommend the Fund over another       
investment.                                                                     

20                                                                              

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ADDITIONAL INFORMATION ABOUT THE FUNDS' RISKS AND INVESTMENTS                   
--------------------------------------------------------------------------------

This section of the Prospectus provides additional information about the Funds' 
investment practices and related risks. Most of these investment practices are  
discretionary, which means that the Adviser may or may not decide to use them.  
This Prospectus does not describe all of a Fund's investment practices and      
additional information about each Fund's risks and investments can be found in  
the Funds' SAI.                                                                 

DERIVATIVES                                                                     
Each Fund may, but is not required to, use derivatives for risk management      
purposes or as part of its investment strategies. Derivatives are financial     
contracts whose value depends on, or is derived from, the value of an           
underlying asset, reference rate or index. A Fund may use derivatives to earn   
income and enhance returns, to hedge or adjust the risk profile of its          
portfolio, to replace more traditional direct investments and to obtain         
exposure to otherwise inaccessible markets.                                     

There are four principal types of derivatives, including options, futures,      
forwards and swaps, which are described below. Derivatives may be               
(i) standardized, exchange-traded contracts or (ii) customized, privately       
negotiated contracts. Exchange-traded derivatives tend to be more liquid and    
subject to less credit risk than those that are privately negotiated.           

A Fund's use of derivatives may involve risks that are different from, or       
possibly greater than, the risks associated with investing directly in          
securities or other more traditional instruments. These risks include the risk  
that the value of a derivative instrument may not correlate perfectly, or at    
all, with the value of the assets, reference rates, or indices that they are    
designed to track. Other risks include: the possible absence of a liquid        
secondary market for a particular instrument and possible exchange-imposed      
price fluctuation limits, either of which may make it difficult or impossible   
to close out a position when desired; and the risk that the counterparty will   
not perform its obligations. Certain derivatives may have a leverage component  
and involve leverage risk. Adverse changes in the value or level of the         
underlying asset, note or index can result in a loss substantially greater than 
the Fund's investment (in some cases, the potential loss is unlimited).         

The Funds' investments in derivatives may include, but are not limited to, the  
following:                                                                      

..  FORWARD CONTRACTS--A forward contract is an agreement that obligates one    
party to buy, and the other party to sell, a specific quantity of an      
underlying commodity or other tangible asset for an agreed upon price at a
future date. A forward contract is either settled by physical delivery of 
  the commodity or tangible asset to an agreed-upon location at a future date,
rolled forward into a new forward contract or, in the case of a           
non-deliverable forward, by a cash payment at maturity. The Funds'        
investments in forward contracts may include the following:               

- Forward Currency Exchange Contracts. A Fund may purchase or sell forward    
currency exchange contracts for hedging purposes to minimize the risk from
adverse changes in the relationship between the U.S. Dollar and other     
currencies or for non-hedging purposes as a means of making direct        
investments in foreign currencies, as described below under "Other        
  Derivatives and Strategies--Currency Transactions." A Fund, for example, may
enter into a forward contract as a transaction hedge (to "lock in" the    
U.S. Dollar price of a non-U.S. Dollar security), as a position hedge (to 
protect the value of securities the Fund owns that are denominated in a   
foreign currency against substantial changes in the value of the foreign  
currency) or as a cross-hedge (to protect the value of securities the Fund
 owns that are denominated in a foreign currency against substantial changes
in the value of that foreign currency by entering into a forward contract 
for a different foreign currency that is expected to change in the same   
direction as the currency in which the securities are denominated).       

..  FUTURES CONTRACTS AND OPTIONS ON FUTURES CONTRACTS--A futures contract is an
  agreement that obligates the buyer to buy and the seller to sell a specified
 quantity of an underlying asset (or settle for cash the value of a contract
based on an underlying asset, rate or index) at a specific price on the   
contract maturity date. Options on futures contracts are options that call
 for the delivery of futures contracts upon exercise. A Fund may purchase or
sell futures contracts and options thereon to hedge against changes in    
  interest rates, securities (through index futures or options) or currencies.
  A Fund may also purchase or sell futures contracts for foreign currencies or
options thereon for non-hedging purposes as a means of making direct      
investments in foreign currencies, as described below under "Other        
Derivatives and Strategies--Currency Transactions."                       

..  OPTIONS--An option is an agreement that, for a premium payment or fee, gives
the option holder (the buyer) the right but not the obligation to buy (a  
 "call option") or sell (a "put option") the underlying asset (or settle for
cash an amount based on an underlying asset, rate or index) at a specified
price (the exercise price) during a period of time or on a specified date.
Investments in options are considered speculative. A Fund may lose the    
  premium paid for them if the price of the underlying security or other asset
decreased or remained the same (in the case of a call option) or increased
 or remained the same (in the case of a put option). If a put or call option
purchased by a Fund were permitted to expire without being sold or        
exercised, its premium would represent a loss to the Fund. The Funds'     
investments in options include the following:                             

- Options on Foreign Currencies. A Fund may invest in options on foreign      
currencies that are privately negotiated or traded on U.S. or foreign     
exchanges for hedging purposes to protect against declines in the         
 U.S. Dollar value of foreign currency denominated securities held by a Fund

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 and against increases in the U.S. Dollar cost of securities to be acquired.
 The purchase of an option on a foreign currency may constitute an effective
hedge against fluctuations in exchange rates, although if rates move      
 adversely, a Fund may forfeit the entire amount of the premium plus related
transaction costs. A Fund may also invest in options on foreign currencies
 for non-hedging purposes as a means of making direct investments in foreign
currencies, as described below under "Other Derivatives and               
Strategies--Currency Transactions."                                       

- Options on Securities. A Fund may purchase or write a put or call option on 
 securities. A Fund may write covered options, which means writing an option
for securities the Fund owns, and uncovered options.                      

- Options on Securities Indices. An option on a securities index is similar to
an option on a security except that, rather than taking or making delivery
of a security at a specified price, an option on a securities index gives 
the holder the right to receive, upon exercise of the option, an amount of
cash if the closing level of the chosen index is greater than (in the case
of a call) or less than (in the case of a put) the exercise price of the  
option.                                                                   

..  SWAP TRANSACTIONS--A swap is an agreement that obligates two parties to     
  exchange a series of cash flows at specified intervals (payment dates) based
upon or calculated by reference to changes in specified prices or rates   
 (interest rates in the case of interest rate swaps, currency exchange rates
  in the case of currency swaps) for a specified amount of an underlying asset
(the "notional" principal amount). Swaps are entered into on a net basis  
(i.e., the two payment streams are netted out, with a Fund receiving or   
  paying, as the case may be, only the net amount of the two payments). Except
for currency swaps, the notional principal amount is used solely to       
calculate the payment stream, but is not exchanged. The Funds' investments
in swap transactions include the following:                               

- Interest Rate Swaps, Swaptions, Caps and Floors. Interest rate swaps involve
the exchange by a Fund with another party of payments calculated by       
reference to specified interest rates (e.g., an exchange of floating rate 
payments for fixed rate payments). Unless there is a counterparty default,
  the risk of loss to the Fund from interest rate swap transactions is limited
to the net amount of interest payments that the Fund is contractually     
 obligated to make. If the counterparty to an interest rate swap transaction
defaults, the Fund's risk of loss consists of the net amount of interest  
payments that the Fund contractually is entitled to receive.              

An option on a swap agreement, also called a "swaption," is an option that
  gives the buyer the right, but not the obligation, to enter into a swap on a
future date in exchange for paying a market-based "premium." A receiver   
swaption gives the owner the right to receive the total return of a       
 specified asset, reference rate, or index. A payer swaption gives the owner
the right to pay the total return of a specified asset, reference rate, or
index. Swaptions also include options that allow an existing swap to be   
terminated or extended by one of the counterparties.                      

The purchase of an interest rate cap entitles the purchaser, to the extent
that a specified index exceeds a predetermined interest rate, to receive  
payments of interest on a contractually-based principal amount from the   
 party selling the interest rate cap. The purchase of an interest rate floor
entitles the purchaser, to the extent that a specified index falls below a
predetermined interest rate, to receive payments of interest on an agreed 
principal amount from the party selling the interest rate floor. Caps and 
floors may be less liquid than swaps.                                     

There is no limit on the amount of interest rate transactions that may be 
  entered into by a Fund. The value of these transactions will fluctuate based
on changes in interest rates.                                             

Interest rate swap, swaption, cap and floor transactions may be used to   
preserve a return or spread on a particular investment or a portion of a  
Fund's portfolio or to protect against an increase in the price of        
securities a Fund anticipates purchasing at a later date.                 

- Inflation (CPI) Swaps. Inflation swap agreements are contracts in which one 
  party agrees to pay the cumulative percentage increase in a price index (the
Consumer Price Index with respect to CPI swaps) over the term of the swap 
(with some lag on the inflation index), and the other pays a compounded   
fixed rate. Inflation swap agreements may be used to protect the NAV of a 
Fund against an unexpected change in the rate of inflation measured by an 
 inflation index since the value of these agreements is expected to increase
if unexpected inflation increases.                                        

- Credit Default Swap Agreements. The "buyer" in a credit default swap        
  contract is obligated to pay the "seller" a periodic stream of payments over
the term of the contract in return for a contingent payment upon the      
occurrence of a credit event with respect to an underlying reference      
obligation. Generally, a credit event means bankruptcy, failure to pay,   
 obligation acceleration or modified restructuring. A Fund may be either the
  buyer or seller in the transaction. If a Fund is a seller, the Fund receives
 a fixed rate of income throughout the term of the contract, which typically
is between one month and five years, provided that no credit event occurs.
If a credit event occurs, a Fund typically must pay the contingent payment
to the buyer, which is typically the "par value" (full notional value) of 
  the reference obligation. The contingent payment may be a cash settlement or
by physical delivery of the reference obligation in return for payment of 
the face amount of the obligation. The value of the reference obligation  
received by a Fund coupled with the periodic payments previously received 
 may be less than the full notional value it pays to the buyer, resulting in
a loss of value to the Fund. If the reference obligation is a defaulted   
security, physical delivery of the security will cause a Fund to hold a   
defaulted security. If a Fund is a buyer and no credit event occurs, the  
Fund will lose its periodic                                               

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  stream of payments over the term of the contract. However, if a credit event
occurs, the buyer typically receives full notional value for a reference  
obligation that may have little or no value.                              

Credit default swaps may involve greater risks than if a Fund had invested
in the reference obligation directly. Credit default swaps are subject to 
general market risk, liquidity risk and credit risk.                      

- Currency Swaps. A Fund may invest in currency swaps for hedging purposes to 
protect against adverse changes in exchange rates between the U.S. Dollar 
  and other currencies or for non-hedging purposes as a means of making direct
investments in foreign currencies, as described below under "Other        
Derivatives and Strategies--Currency Transactions." Currency swaps involve
the individually negotiated exchange by a Fund with another party of a    
series of payments in specified currencies. Actual principal amounts of   
currencies may be exchanged by the counterparties at the initiation, and  
again upon the termination, of the transaction. Therefore, the entire     
principal value of a currency swap is subject to the risk that the swap   
 counterparty will default on its contractual delivery obligations. If there
is a default by the counterparty to the transaction, the Fund will have   
contractual remedies under the transaction agreements.                    

- Total Return Swaps. A Fund may enter into total return swaps, under which   
one party agrees to pay the other the total return of a defined underlying
asset, such as a security or basket of securities, or non-asset reference,
such as a securities index, during the specified period in return for     
periodic payments based on a fixed or variable interest rate or the total 
return from different underlying assets or references. Total return swaps 
  could result in losses if the underlying asset or reference does not perform
as anticipated.                                                           

..  OTHER DERIVATIVES AND STRATEGIES--                                          

- Eurodollar Instruments. Eurodollar instruments are essentially              
 U.S. Dollar-denominated futures contracts or options that are linked to the
London Interbank Offered Rate (LIBOR). Eurodollar futures contracts enable
purchasers to obtain a fixed rate for the lending of funds and sellers to 
obtain a fixed rate for borrowings.                                       

- Structured Instruments. As part of its investment program and to maintain   
  greater flexibility, a Fund may invest in structured instruments. Structured
instruments, including indexed or structured securities, combine the      
elements of futures contracts or options with those of debt, preferred    
equity or a depositary instrument. Generally, a structured instrument will
be a debt security, preferred stock, depositary share, trust certificate, 
 certificate of deposit or other evidence of indebtedness on which a portion
of or all interest payments, and/or the principal or stated amount payable
  at maturity, redemption or retirement, is determined by reference to prices,
  changes in prices, or differences between prices, of securities, currencies,
intangibles, goods, articles or commodities (collectively "Underlying     
Assets") or by another objective index, economic factor or other measure, 
such as interest rates, currency exchange rates, commodity indices, and   
securities indices (collectively, "Benchmarks"). Thus, structured         
  instruments may take a variety of forms, including, but not limited to, debt
instruments with interest or principal payments or redemption terms       
determined by reference to the value of a currency or commodity or        
securities index at a future point in time, preferred stock with dividend 
rates determined by reference to the value of a currency, or convertible  
securities with the conversion terms related to a particular commodity.   

Structured instruments are potentially more volatile and carry greater    
market risks than traditional debt instruments. Depending on the structure
of the particular structured instrument, changes in a Benchmark may be    
magnified by the terms of the structured instrument and have an even more 
  dramatic and substantial effect upon the value of the structured instrument.
Also, the prices of the structured instrument and the Benchmark or        
Underlying Asset may not move in the same direction or at the same time.  

Structured instruments can have volatile prices and limited liquidity, and
  their use by a Fund may not be successful. The risk of these investments can
be substantial; possibly all of the principal is at risk. No Fund will    
invest more than 20% of its total assets in these investments.            

- Currency Transactions. A Fund may invest in non-U.S. Dollar-denominated     
  securities on a currency hedged or un-hedged basis. The Adviser may actively
 manage a Fund's currency exposures and may seek investment opportunities by
taking long or short positions in currencies through the use of           
  currency-related derivatives, including forward currency exchange contracts,
futures and options on futures, swaps and options. The Adviser may enter  
into transactions for investment opportunities when it anticipates that a 
foreign currency will appreciate or depreciate in value but securities    
denominated in that currency are not held by a Fund and do not present    
  attractive investment opportunities. Such transactions may also be used when
 the Adviser believes that it may be more efficient than a direct investment
  in a foreign currency-denominated security. A Fund may also conduct currency
exchange contracts on a spot basis (i.e., for cash at the spot rate       
   prevailing in the currency exchange market for buying or selling currencies).

FORWARD COMMITMENTS                                                             
Forward commitments for the purchase or sale of securities may include          
purchases on a when-issued basis or purchases or sales on a delayed delivery    
basis. In some cases, a forward commitment may be conditioned upon the          
occurrence of a subsequent event, such as approval and consummation of a        
merger, corporate reorganization or debt restructuring or approval of a         
proposed financing by appropriate authorities (i.e., a "when, as and if issued" 
trade).                                                                         

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A Fund may invest significantly in TBA-mortgage-backed securities. A TBA or "To 
Be Announced" trade represents a contract for the purchase or sale of           
mortgage-backed securities to be delivered at a future agreed-upon date;        
however, the specific mortgage pool numbers or the number of pools that will be 
delivered to fulfill the trade obligation or terms of the contract are unknown  
at the time of the trade. Mortgage pools (including fixed rate or variable rate 
mortgages) guaranteed by the Government National Mortgage Association, or GNMA, 
the Federal National Mortgage Association, or FNMA, or the Federal Home Loan    
Mortgage Corporation, or FHLMC, are subsequently allocated to the TBA           
transactions.                                                                   

When forward commitments with respect to fixed-income securities are            
negotiated, the price, which is generally expressed in yield terms, is fixed at 
the time the commitment is made, but payment for and delivery of the securities 
take place at a later date. Securities purchased or sold under a forward        
commitment are subject to market fluctuation and no interest or dividends       
accrue to the purchaser prior to the settlement date. There is the risk of loss 
if the value of either a purchased security declines before the settlement date 
or the security sold increases before the settlement date. The use of forward   
commitments helps a Fund to protect against anticipated changes in interest     
rates and prices.                                                               

ILLIQUID SECURITIES                                                             
Under current Securities and Exchange Commission ("Commission") guidelines, the 
Funds limit their investments in illiquid securities to 15% of their net        
assets. The term "illiquid securities" for this purpose means securities that   
cannot be disposed of within seven days in the ordinary course of business at   
approximately the amount a Fund has valued the securities. A Fund that invests  
in illiquid securities may not be able to sell such securities and may not be   
able to realize their full value upon sale. Restricted securities (securities   
subject to legal or contractual restrictions on resale) may be illiquid. Some   
restricted securities (such as securities issued pursuant to Rule 144A under    
the Securities Act of 1933 (the "Securities Act") or certain commercial paper)  
may be treated as liquid, although they may be less liquid than registered      
securities traded on established secondary markets.                             

INDEXED COMMERCIAL PAPER                                                        
Indexed commercial paper may have its principal linked to changes in foreign    
currency exchange rates whereby its principal amount is adjusted upwards or     
downwards (but not below zero) at maturity to reflect changes in the referenced 
exchange rate. A Fund will receive interest and principal payments on such      
commercial paper in the currency in which such commercial paper is denominated, 
but the amount of principal payable by the issuer at maturity will change in    
proportion to the change (if any) in the exchange rate between the two          
specified currencies between the date the instrument is issued and the date the 
instrument matures. While such commercial paper entails the risk of loss of     
principal, the potential for realizing gains as a result of changes in foreign  
currency exchange rates enables a Fund to hedge (or cross-hedge) against a      
decline in the U.S. Dollar value of investments denominated in foreign          
currencies while providing an attractive money market rate of return. A Fund    
will purchase such commercial paper for hedging purposes only, not for          
speculation.                                                                    

INFLATION-PROTECTED SECURITIES                                                  
Inflation-protected securities, or IPS, are fixed-income securities whose       
principal value is periodically adjusted according to the rate of inflation. If 
the index measuring inflation falls, the principal value of these securities    
will be adjusted downward, and consequently the interest payable on these       
securities (calculated with respect to a smaller principal amount) will be      
reduced.                                                                        

The value of inflation-protected securities tends to react to changes in real   
interest rates. In general, the price of an inflation-protected security can    
fall when real interest rates rise, and can rise when real interest rates fall. 
In addition, the value of inflation-protected securities can fluctuate based on 
fluctuations in expectations of inflation. Interest payments on                 
inflation-protected securities can be unpredictable and will vary as the        
principal and/or interest is adjusted for inflation.                            

INVESTMENT IN OTHER INVESTMENT COMPANIES                                        
The Funds may invest in other investment companies as permitted by the          
Investment Company Act of 1940 (the "1940 Act") or the rules and regulations    
thereunder. The Funds intend to invest uninvested cash balances in an           
affiliated money market fund as permitted by Rule 12d1-1 under the 1940 Act. If 
a Fund acquires shares in investment companies, shareholders would bear,        
indirectly, the expenses of such investment companies (which may include        
management and advisory fees), which are in addition to the Fund's expenses. A  
Fund may also invest in exchange-traded funds, subject to the restrictions and  
limitations of the 1940 Act or any applicable rules, exemptive orders or        
regulatory guidance.                                                            

LOAN PARTICIPATIONS                                                             
A Fund may invest in corporate loans either by participating as co-lender at    
the time the loan is originated or by buying an interest in the loan in the     
secondary market from a financial institution or institutional investor. The    
financial status of an institution interposed between a Fund and a borrower may 
affect the ability of the Fund to receive principal and interest payments.      

The success of a Fund may depend on the skill with which an agent bank          
administers the terms of the corporate loan agreements, monitors borrower       
compliance with covenants, collects principal, interest and fee payments from   
borrowers and, where necessary, enforces creditor remedies against borrowers.   
Agent banks typically have broad discretion in enforcing loan agreements.       

MORTGAGE-RELATED AND OTHER ASSET-BACKED SECURITIES                              
A Fund may invest in mortgage-related or other asset-backed securities.         
Mortgage-related securities include mortgage pass-through securities,           
collateralized mortgage obligations ("CMOs"), commercial mortgage-backed        
securities, mortgage dollar rolls, CMO residuals, stripped mortgage-backed      
securities ("SMBSs") and other securities that directly or indirectly represent 
a participation in or are secured by and payable from                           

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mortgage loans on real property. These securities may be issued or guaranteed   
by the U.S. Government or one of its sponsored entities or may be issued by     
private organizations.                                                          

The value of mortgage-related or asset-backed securities may be particularly    
sensitive to changes in prevailing interest rates. Early payments of principal  
on some mortgage-related securities may occur during periods of falling         
mortgage interest rates and expose a Fund to a lower rate of return upon        
reinvestment of principal. Early payments associated with mortgage-related      
securities cause these securities to experience significantly greater price and 
yield volatility than is experienced by traditional fixed-income securities.    
During periods of rising interest rates, a reduction in prepayments may         
increase the effective life of mortgage-related securities, subjecting them to  
greater risk of decline in market value in response to rising interest rates.   
If the life of a mortgage-related security is inaccurately predicted, a Fund    
may not be able to realize the rate of return it expected.                      

One type of SMBS has one class receiving all of the interest from the mortgage  
assets (the interest-only, or "IO" class), while the other class will receive   
all of the principal (the principal-only, or "PO" class). The yield to maturity 
on an IO class is extremely sensitive to the rate of principal payments         
(including prepayments) on the underlying mortgage assets, and a rapid rate of  
principal payments may have a material adverse effect on a Fund's yield to      
maturity from these securities.                                                 

A Fund may invest in collateralized debt obligations ("CDOs"), which include    
collateralized bond obligations ("CBOs"), collateralized loan obligations       
("CLOs"), and other similarly structured securities. CBOs and CLOs are types of 
asset-backed securities. A CBO is a trust that is backed by a diversified pool  
of high-risk, below investment grade fixed-income securities. A CLO is a trust  
typically collateralized by a pool of loans, which may include, among others,   
domestic and foreign senior secured loans, senior unsecured loans, and          
subordinate corporate loans, including loans that may be rated below investment 
grade or equivalent unrated loans. The Funds may invest in other asset-backed   
securities that have been offered to investors.                                 

A Fund may invest in other asset-backed securities. The securitization          
techniques used to develop mortgage-related securities are being applied to a   
broad range of financial assets. Through the use of trusts and special purpose  
corporations, various types of assets, including automobile loans and leases,   
credit card receivables, home equity loans, equipment leases and trade          
receivables, are being securitized in structures similar to the structures used 
in mortgage securitizations.                                                    

PREFERRED STOCK                                                                 
A Fund may invest in preferred stock. Preferred stock is subordinated to any    
debt the issuer has outstanding. Accordingly, preferred stock dividends are not 
paid until all debt obligations are first met. Preferred stock may be subject   
to more fluctuations in market value, due to changes in market participants'    
perceptions of the issuer's ability to continue to pay dividends, than debt of  
the issuer. These investments include convertible preferred stock, which        
includes an option for the holder to convert the preferred stock into the       
issuer's common stock under certain conditions, among which may be the          
specification of a future date when the conversion may begin, a certain number  
of common shares per preferred shares, or a certain price per share for the     
common stock. Convertible preferred stock tends to be more volatile than        
non-convertible preferred stock, because its value is related to the price of   
the issuer's common stock as well as the dividends payable on the preferred     
stock.                                                                          

REPURCHASE AGREEMENTS AND BUY/SELL BACK TRANSACTIONS                            
A Fund may enter into repurchase agreements in which a Fund purchases a         
security from a bank or broker-dealer, which agrees to repurchase the security  
from the Fund at an agreed-upon future date, normally a day or a few days       
later. The purchase and repurchase transactions are transacted under one        
agreement. The resale price is greater than the purchase price, reflecting an   
agreed-upon interest rate for the period the buyer's money is invested in the   
security. Such agreements permit a Fund to keep all of its assets at work while 
retaining "overnight" flexibility in pursuit of investments of a longer-term    
nature. If the bank or broker-dealer defaults on its repurchase obligation, a   
Fund would suffer a loss to the extent that the proceeds from the sale of the   
security were less than the repurchase price.                                   

A Fund may enter into buy/sell back transactions, which are similar to          
repurchase agreements. In this type of transaction, a Fund enters a trade to    
buy securities at one price and simultaneously enters a trade to sell the same  
securities at another price on a specified date. Similar to a repurchase        
agreement, the repurchase price is higher than the sale price and reflects      
current interest rates. Unlike a repurchase agreement, however, the buy/sell    
back transaction is considered two separate transactions.                       

REVERSE REPURCHASE AGREEMENTS, DOLLAR ROLLS AND OTHER BORROWINGS                
A Fund may enter into reverse repurchase agreements and dollar rolls, subject   
to the Fund's limitations on borrowings. A reverse repurchase agreement or      
dollar roll involves the sale of a security by a Fund and its agreement to      
repurchase the instrument at a specified time and price, and may be considered  
a form of borrowing for some purposes. Reverse repurchase agreements, dollar    
rolls and other forms of borrowings may create leverage risk for a Fund. In     
addition, reverse repurchase agreements and dollar rolls involve the risk that  
the market value of the securities a Fund is obligated to repurchase may        
decline below the purchase price.                                               

Dollar rolls involve sales by a Fund of securities for delivery in the current  
month and the Fund's simultaneously contracting to repurchase substantially     
similar (same type and coupon) securities on a specified future date. During    
the roll period, a Fund forgoes principal and interest paid on the securities.  
A Fund is compensated by the difference between the current sales price and the 
lower forward price for the future purchase (often referred to as the "drop")   
as well as by the interest earned on the cash proceeds of the initial sale.     

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Reverse repurchase agreements and dollar rolls involve the risk that the market 
value of the securities a Fund is obligated to repurchase under the agreement   
may decline below the repurchase price. In the event the buyer of securities    
under a reverse repurchase agreement or dollar roll files for bankruptcy or     
becomes insolvent, a Fund's use of the proceeds of the agreement may be         
restricted pending a determination by the other party, or its trustee or        
receiver, whether to enforce the Fund's obligation to repurchase the securities.

RIGHTS AND WARRANTS                                                             
Rights and warrants are option securities permitting their holders to subscribe 
for other securities. Rights are similar to warrants except that they have a    
substantially shorter duration. Rights and warrants do not carry with them      
dividend or voting rights with respect to the underlying securities, or any     
rights in the assets of the issuer. As a result, an investment in rights and    
warrants may be considered more speculative than certain other types of         
investments. In addition, the value of a right or a warrant does not            
necessarily change with the value of the underlying securities, and a right or  
a warrant ceases to have value if it is not exercised prior to its expiration   
date.                                                                           

SHORT SALES                                                                     
A Fund may make short sales as a part of overall portfolio management or to     
offset a potential decline in the value of a security. A short sale involves    
the sale of a security that a Fund does not own, or if the Fund owns the        
security, is not to be delivered upon consummation of the sale. When the Fund   
makes a short sale of a security that it does not own, it must borrow from a    
broker-dealer the security sold short and deliver the security to the           
broker-dealer upon conclusion of the short sale.                                

If the price of the security sold short increases between the time of the short 
sale and the time a Fund replaces the borrowed security, the Fund will incur a  
loss; conversely, if the price declines, the Fund will realize a gain. The      
potential for the price of a fixed-income security sold short to rise is a      
function of both the remaining maturity of the obligation, its creditworthiness 
and its yield. Unlike short sales of equities or other instruments, potential   
for the price of a fixed-income security to rise may be limited due to the fact 
that the security will be no more than par at maturity. However, the short sale 
of other instruments or securities generally, including fixed-income securities 
convertible into equities or other instruments, a fixed-income security trading 
at a deep discount from par or that pays a coupon that is high in relative      
and/or absolute terms, or that is denominated in a currency other than the      
U.S. Dollar, involves the possibility of a theoretically unlimited loss since   
there is a theoretically unlimited potential for the market price of the        
security sold short to increase.                                                

STANDBY COMMITMENT AGREEMENTS                                                   
Standby commitment agreements are similar to put options that commit a Fund,    
for a stated period of time, to purchase a stated amount of a security that may 
be issued and sold to the Fund at the option of the issuer. The price and       
coupon of the security are fixed at the time of the commitment. At the time of  
entering into the agreement, the Fund is paid a commitment fee, regardless of   
whether the security ultimately is issued. The Funds will enter into such       
agreements only for the purpose of investing in the security underlying the     
commitment at a yield and price considered advantageous to the Fund and         
unavailable on a firm commitment basis.                                         

There is no guarantee that a security subject to a standby commitment will be   
issued. In addition, the value of the security, if issued, on the delivery date 
may be more or less than its purchase price. Since the issuance of the security 
is at the option of the issuer, a Fund will bear the risk of capital loss in    
the event the value of the security declines and may not benefit from an        
appreciation in the value of the security during the commitment period if the   
issuer decides not to issue and sell the security to the Fund.                  

STRUCTURED SECURITIES AND BASKET SECURITIES                                     
A Fund may invest in various types of structured securities and basket          
securities. Structured securities are securities issued in structured financing 
transactions, which generally involve aggregating types of debt assets in a     
pool or special purpose entity and then issuing new securities. Types of        
structured financings include securities described elsewhere in this            
Prospectus, such as mortgage-related and other asset-backed securities. A       
Fund's investments include investments in structured securities that represent  
interests in entities organized and operated solely for the purpose of          
restructuring the investment characteristics of particular debt obligations.    
This type of restructuring involves the deposit with or purchase by an entity,  
such as a corporation or trust, of specified instruments (such as commercial    
bank loans or high yield bonds) and the issuance by that entity of one or more  
classes of structured securities backed by, or representing interests in, the   
underlying instruments. The cash flow on the underlying instruments may be      
apportioned among the newly issued structured securities to create securities   
with different investment characteristics such as varying maturities, payment   
priorities and interest rate provisions, and the extent of the payments made    
with respect to structured securities is dependent on the extent of the cash    
flow from the underlying instruments. Structured securities of a given class    
may be either subordinated or unsubordinated to the payment of another class.   
Subordinated structured securities typically have higher yields and present     
greater risks than unsubordinated structured securities.                        

Basket securities in which a Fund may invest may consist of entities organized  
and operated for the purpose of holding a basket of other securities. Baskets   
involving debt obligations may be designed to represent the characteristics of  
some portion of the debt securities market or the entire debt securities market.

SOVEREIGN DEBT OBLIGATIONS                                                      
No established secondary markets may exist for many sovereign debt obligations. 
Reduced secondary market liquidity may have an adverse effect on the market     
price and a Fund's ability to dispose of particular instruments when necessary  
to meet its liquidity requirements or in response to specific economic events   
such as a deterioration in the creditworthiness of the issuer. Reduced          
secondary market liquidity for certain sovereign debt obligations may also make 
it more difficult for a Fund to                                                 

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obtain accurate market quotations for the purpose of valuing its portfolio.     
Market quotations are generally available on many sovereign debt obligations    
only from a limited number of dealers and may not necessarily represent firm    
bids of those dealers or prices for actual sales.                               

By investing in sovereign debt obligations, the Funds will be exposed to the    
direct or indirect consequences of political, social, and economic changes in   
various countries. Political changes in a country may affect the willingness of 
a foreign government to make or provide for timely payments of its obligations. 
The country's economic status, as reflected in, among other things, its         
inflation rate, the amount of its external debt and its gross domestic product, 
will also affect the government's ability to honor its obligations.             

The Funds are permitted to invest in sovereign debt obligations that are not    
current in the payment of interest or principal or are in default so long as    
the Adviser believes it to be consistent with the Funds' investment objectives. 
The Funds may have limited legal recourse in the event of a default with        
respect to certain sovereign debt obligations they hold. For example, remedies  
from defaults on certain sovereign debt obligations, unlike those on private    
debt, must, in some cases, be pursued in the courts of the defaulting party     
itself. Legal recourse therefore may be significantly diminished. Bankruptcy,   
moratorium, and other similar laws applicable to issuers of sovereign debt      
obligations may be substantially different from those applicable to issuers of  
private debt obligations. The political context, expressed as the willingness   
of an issuer of sovereign debt obligations to meet the terms of the debt        
obligation, for example, is of considerable importance. In addition, no         
assurance can be given that the holders of commercial bank debt will not        
contest payments to the holders of securities issued by foreign governments in  
the event of default under commercial bank loan agreements.                     

VARIABLE, FLOATING AND INVERSE FLOATING RATE INSTRUMENTS                        
Variable and floating rate securities pay interest at rates that are adjusted   
periodically, according to a specified formula. A "variable" interest rate      
adjusts at predetermined intervals (e.g., daily, weekly or monthly), while a    
"floating" interest rate adjusts whenever a specified benchmark rate (such as   
the bank prime lending rate) changes.                                           

A Fund may also invest in inverse floating rate debt instruments ("inverse      
floaters"). The interest rate on an inverse floater resets in the opposite      
direction from the market rate of interest to which the inverse floater is      
indexed. An inverse floater may have greater volatility in market value, in     
that, during periods of rising interest rates, the market values of inverse     
floaters will tend to decrease more rapidly than those of fixed rate securities.

ZERO COUPON AND PRINCIPAL-ONLY SECURITIES                                       
Zero coupon securities and principal-only (PO) securities are debt securities   
that have been issued without interest coupons or stripped of their unmatured   
interest coupons, and include receipts or certificates representing interests   
in such stripped debt obligations and coupons. Such a security pays no interest 
to its holder during its life. Its value to an investor consists of the         
difference between its face value at the time of maturity and the price for     
which it was acquired, which is generally an amount significantly less than its 
face value. Such securities usually trade at a deep discount from their face or 
par value and are subject to greater fluctuations in market value in response   
to changing interest rates than debt obligations of comparable maturities and   
credit quality that make current distributions of interest. On the other hand,  
because there are no periodic interest payments to be reinvested prior to       
maturity, these securities eliminate reinvestment risk and "lock in" a rate of  
return to maturity.                                                             

ADDITIONAL RISK AND OTHER CONSIDERATIONS                                        
Investments in the Funds involve the special risk considerations described      
below. Certain of these risks may be heightened when investing in emerging      
markets.                                                                        

BORROWING AND LEVERAGE                                                          
The Funds may use borrowings for investment purposes subject to applicable      
statutory or regulatory requirements. Borrowings by a Fund result in leveraging 
of the Fund's shares. A Fund may also use leverage for investment transactions  
by entering into transactions such as reverse repurchase agreements, forward    
contracts and dollar rolls. This means that a Fund uses cash made available     
during the term of these transactions to make investments in other fixed-income 
securities.                                                                     

Utilization of leverage, which is usually considered speculative, involves      
certain risks to a Fund's shareholders. These include a higher volatility of    
the NAV of a Fund's shares and the relatively greater effect on the NAV of the  
shares. So long as a Fund is able to realize a net return on its investment     
portfolio that is higher than the interest expense paid on borrowings or the    
carrying costs of leveraged transactions, the effect of leverage will be to     
cause the Fund's shareholders to realize a higher current net investment income 
than if the Fund were not leveraged. If the interest expense on borrowings or   
the carrying costs of leveraged transactions approaches the net return on a     
Fund's investment portfolio, the benefit of leverage to the Fund's shareholders 
will be reduced. If the interest expense on borrowings or the carrying costs of 
leveraged transactions were to exceed the net return to shareholders, a Fund's  
use of leverage would result in a lower rate of return. Similarly, the effect   
of leverage in a declining market could be a greater decrease in NAV. In an     
extreme case, if a Fund's current investment income were not sufficient to meet 
the interest expense on borrowings or the carrying costs of leveraged           
transactions, it could be necessary for the Fund to liquidate certain of its    
investments, thereby reducing its NAV.                                          

FOREIGN (NON-U.S.) SECURITIES                                                   
Investing in foreign securities involves special risks and considerations not   
typically associated with investing in U.S. securities. The securities markets  
of many foreign countries are relatively small, with the majority of market     
capitalization and trading volume concentrated in a limited number of companies 
representing a small number of industries. A Fund that invests                  

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in foreign fixed-income securities may experience greater price volatility and  
significantly lower liquidity than a portfolio invested solely in securities of 
U.S. companies. These markets may be subject to greater influence by adverse    
events generally affecting the market, and by large investors trading           
significant blocks of securities, than is usual in the United States.           

Securities registration, custody, and settlement may in some instances be       
subject to delays and legal and administrative uncertainties. Foreign           
investment in the securities markets of certain foreign countries is restricted 
or controlled to varying degrees. These restrictions or controls may at times   
limit or preclude investment in certain securities and may increase the cost    
and expenses of a Fund. In addition, the repatriation of investment income,     
capital or the proceeds of sales of securities from certain of the countries is 
controlled under regulations, including in some cases the need for certain      
advance government notification or authority, and if a deterioration occurs in  
a country's balance of payments, the country could impose temporary             
restrictions on foreign capital remittances.                                    

A Fund also could be adversely affected by delays in, or a refusal to grant,    
any required governmental approval for repatriation, as well as by the          
application to it of other restrictions on investment. Investing in local       
markets may require a Fund to adopt special procedures or seek local            
governmental approvals or other actions, any of which may involve additional    
costs to a Fund. These factors may affect the liquidity of a Fund's investments 
in any country and the Adviser will monitor the effect of any such factor or    
factors on a Fund's investments. Transaction costs, including brokerage         
commissions for transactions both on and off the securities exchanges, in many  
foreign countries are generally higher than in the United States.               

Issuers of securities in foreign jurisdictions are generally not subject to the 
same degree of regulation as are U.S. issuers with respect to such matters as   
insider trading rules, restrictions on market manipulation, shareholder proxy   
requirements, and timely disclosure of information. The reporting, accounting,  
and auditing standards of foreign countries may differ, in some cases           
significantly, from U.S. standards in important respects, and less information  
may be available to investors in foreign securities than to investors in U.S.   
securities. Substantially less information is publicly available about certain  
non-U.S. issuers than is available about most U.S. issuers.                     

The economies of individual foreign countries may differ favorably or           
unfavorably from the U.S. economy in such respects as growth of gross domestic  
product or gross national product, rate of inflation, capital reinvestment,     
resource self-sufficiency, and balance of payments position. Nationalization,   
expropriation or confiscatory taxation, currency blockage, political changes,   
government regulation, political or social instability, revolutions, wars or    
diplomatic developments could affect adversely the economy of a foreign         
country. In the event of nationalization, expropriation, or other confiscation, 
a Fund could lose its entire investment in securities in the country involved.  
In addition, laws in foreign countries governing business organizations,        
bankruptcy and insolvency may provide less protection to security holders such  
as the Fund than that provided by U.S. laws.                                    

Investments in securities of companies in emerging markets involve special      
risks. There are approximately 100 countries identified by the World Bank as    
Low Income, Lower Middle Income and Upper Middle Income countries that are      
generally regarded as Emerging Markets. Emerging market countries that the      
Adviser currently considers for investment are listed below. Countries may be   
added to or removed from this list at any time.                                 

                                                                [Download Table]
                                                  
Algeria             Hong Kong    Poland           
Argentina           Hungary      Qatar            
Belize              India        Romania          
Brazil              Indonesia    Russia           
Bulgaria            Israel       Singapore        
Chile               Jamaica      Slovakia         
China               Jordan       Slovenia         
Colombia            Kazakhstan   South Africa     
Costa Rica          Lebanon      South Korea      
Cote D'Ivoire       Malaysia     Taiwan           
Croatia             Mexico       Thailand         
Czech Republic      Morocco      Trinidad & Tobago
Dominican Republic  Nigeria      Tunisia          
Ecuador             Pakistan     Turkey           
Egypt               Panama       Ukraine          
El Salvador         Peru         Uruguay          
Guatemala           Philippines  Venezuela        

Investing in emerging market securities imposes risks different from, or        
greater than, risks of investing in domestic securities or in foreign,          
developed countries. These risks include: smaller market capitalization of      
securities markets, which may suffer periods of relative illiquidity;           
significant price volatility; restrictions on foreign investment; and possible  
repatriation of investment income and capital. In addition, foreign investors   
may be required to register the proceeds of sales; future economic or political 
crises could lead to price controls, forced mergers, expropriation or           
confiscatory taxation, seizure, nationalization or creation of government       
monopolies. The currencies of emerging market countries may experience          
significant declines against the U.S. Dollar, and devaluation may occur         
subsequent to investments in these currencies by a Fund. Inflation and rapid    
fluctuations in inflation rates have had, and may continue to have, negative    
effects on the economies and securities markets of certain emerging market      
countries.                                                                      

Additional risks of emerging market securities may include: greater social,     
economic and political uncertainty and instability; more substantial            
governmental involvement in the economy; less governmental supervision and      
regulation; unavailability of currency hedging techniques; companies that are   
newly organized and small; differences in auditing and financial reporting      
standards, which may result in unavailability of material information about     
issuers; and less developed legal systems. In addition, emerging securities     
markets may have different clearance and settlement procedures, which may be    
unable to keep pace with the volume of securities transactions or otherwise     
make it difficult to engage in such transactions. Settlement problems may cause 
a Fund to miss attractive investment oppor-                                     

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tunities, hold a portion of its assets in cash pending investment, or be        
delayed in disposing of a portfolio security. Such a delay could result in      
possible liability to a purchaser of the security.                              

FOREIGN (NON-U.S.) CURRENCIES                                                   
A Fund that invests some portion of its assets in securities denominated in,    
and receives revenues in, foreign currencies will be adversely affected by      
reductions in the value of those currencies relative to the U.S. Dollar.        
Foreign currency exchange rates may fluctuate significantly. They are           
determined by supply and demand in the foreign exchange markets, the relative   
merits of investments in different countries, actual or perceived changes in    
interest rates, and other complex factors. Currency exchange rates also can be  
affected unpredictably by intervention (or the failure to intervene) by U.S. or 
foreign governments or central banks or by currency controls or political       
developments. In light of these risks, a Fund may engage in certain currency    
hedging transactions, as described above, which involve certain special risks.  

A Fund may also invest directly in foreign currencies for non-hedging purposes  
directly on a spot basis (i.e., cash) or through derivative transactions, such  
as forward currency exchange contracts, futures and options thereon, swaps and  
options as described above. These investments will be subject to the same       
risks. In addition, currency exchange rates may fluctuate significantly over    
short periods of time, causing a Fund's NAV to fluctuate.                       

INVESTMENT IN BELOW INVESTMENT GRADE FIXED-INCOME SECURITIES                    
Investments in securities rated below investment grade (commonly known as "junk 
bonds") may be subject to greater risk of loss of principal and interest than   
higher-rated securities. These securities are also generally considered to be   
subject to greater market risk than higher-rated securities. The capacity of    
issuers of these securities to pay interest and repay principal is more likely  
to weaken than is that of issuers of higher-rated securities in times of        
deteriorating economic conditions or rising interest rates. In addition, below  
investment grade securities may be more susceptible to real or perceived        
adverse economic conditions than investment grade securities.                   

The market for these securities may be thinner and less active than that for    
higher-rated securities, which can adversely affect the prices at which these   
securities can be sold. To the extent that there is no established secondary    
market for these securities, a Fund may experience difficulty in valuing such   
securities and, in turn, the Fund's assets.                                     

UNRATED SECURITIES                                                              
A Fund may invest in unrated securities when the Adviser believes that the      
financial condition of the issuers of such securities, or the protection        
afforded by the terms of the securities themselves, limits the risk to the Fund 
to a degree comparable to that of rated securities that are consistent with the 
Fund's objective and policies.                                                  

FUTURE DEVELOPMENTS                                                             
A Fund may take advantage of other investment practices that are not currently  
contemplated for use by the Fund, or are not available but may yet be           
developed, to the extent such investment practices are consistent with the      
Fund's investment objective and legally permissible for the Fund. Such          
investment practices, if they arise, may involve risks that exceed those        
involved in the activities described above.                                     

CHANGES IN INVESTMENT OBJECTIVES AND POLICIES                                   
A Fund's Board of Directors (the "Board") may change the Fund's investment      
objective without shareholder approval. The Fund will provide shareholders with 
60 days' prior written notice of any change to the Fund's investment objective. 
Unless otherwise noted, all other investment policies of a Fund may be changed  
without shareholder approval.                                                   

TEMPORARY DEFENSIVE POSITION                                                    
For temporary defensive purposes in an attempt to respond to adverse market,    
economic, political or other conditions, each Fund may invest in certain types  
of short-term, liquid, investment grade or high quality (depending on the Fund) 
debt securities. While a Fund is investing for temporary defensive purposes, it 
may not meet its investment objectives.                                         

PORTFOLIO HOLDINGS                                                              
A description of the Funds' policies and procedures with respect to the         
disclosure of the Funds' portfolio securities is available in the Funds' SAI.   

                                                                            29

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INVESTING IN THE FUNDS                                                          
--------------------------------------------------------------------------------

This section discusses how to buy, sell or redeem, or exchange different        
classes of shares of a Fund that are offered in this Prospectus. The Funds      
offer four classes of shares through this Prospectus.                           

Each share class represents an investment in the same portfolio of securities,  
but the classes may have different sales charges and bear different ongoing     
distribution expenses. For additional information on the differences between    
the different classes of shares and factors to consider when choosing among     
them, please see "The Different Share Class Expenses" below.                    

HOW TO BUY SHARES                                                               
The purchase of a Fund's shares is priced at the next determined NAV after your 
order is received in proper form.                                               

Class A, Class R, Class K and Class I shares are available at NAV, without an   
initial sales charge, to 401(k) plans, 457 plans, employer-sponsored 403(b)     
plans, profit-sharing and money purchase pension plans, defined benefit plans,  
and non-qualified deferred compensation plans where plan level or omnibus       
accounts are held on the books of a Fund ("group retirement plans"), as follows:

Class A shares offered through this Prospectus are designed for group           
retirement plans with assets in excess of $10,000,000. Class A shares are also  
available at NAV to the AllianceBernstein Link, AllianceBernstein Individual    
401(k) and AllianceBernstein SIMPLE IRA plans with at least $250,000 in plan    
assets or 100 employees.                                                        

Class R shares are designed for group retirement plans with plan assets up to   
$10,000,000.                                                                    

Class K shares are designed for group retirement plans with at least $1,000,000 
in plan assets.                                                                 

Class I shares are designed for group retirement plans with at least            
$10,000,000 in plan assets and certain related group retirement plans described 
in the Funds' SAI. Class I shares are also available to certain institutional   
clients of the Adviser who invest at least $2 million in a Fund.                

Class A, Class R, Class K and Class I shares are also available to certain      
AllianceBernstein-sponsored group retirement plans. Class R, Class K and        
Class I shares generally are not available to retail non-retirement accounts,   
traditional and Roth IRAs, Coverdell Education Savings Accounts, SEPs,          
SAR-SEPs, SIMPLE IRAs, and individual 403(b) plans. Effective October 19, 2005, 
Class I shares were no longer available to AllianceBernstein-sponsored group    
retirement plan programs known as the "Informed Choice" programs.               

REQUIRED INFORMATION                                                            
A Fund is required by law to obtain, verify, and record certain personal        
information from you or persons on your behalf in order to establish an         
account. Required information includes name, date of birth, permanent           
residential address and taxpayer identification number (for most investors,     
your social security number). A Fund may also ask to see other identifying      
documents. If you do not provide the information, the Fund will not be able to  
open your account. If a Fund is unable to verify your identity, or that of      
another person(s) authorized to act on your behalf, or if the Fund believes it  
has identified potentially criminal activity, the Fund reserves the right to    
take action it deems appropriate or as required by law, which may include       
closing your account. If you are not a U.S. citizen or resident alien, your     
account must be affiliated with a Financial Industry Regulatory Authority, or   
FINRA, member firm.                                                             

A Fund is required to withhold 28% of taxable dividends, capital gains          
distributions, and redemptions paid to any shareholder who has not provided the 
Fund with his or her correct taxpayer identification number. To avoid this, you 
must provide your correct tax identification number on your Mutual Fund         
Application.                                                                    

GENERAL                                                                         
AllianceBernstein Investments, Inc., or ABI, may refuse any order to purchase   
shares. Each Fund reserves the right to suspend the sale of its shares to the   
public in response to conditions in the securities markets or for other reasons.

THE DIFFERENT SHARE CLASS EXPENSES                                              
This section describes the different expenses of investing in each class and    
explains factors to consider when choosing a class of shares. The expenses can  
include distribution and/or service (Rule 12b-1) fees or CDSCs.                 

WHAT IS A RULE 12B-1 FEE? 
A Rule 12b-1 fee is a fee deducted from a Fund's assets that is used to pay 
for personal service, maintenance of shareholder accounts and distribution  
costs, such as advertising and compensation of financial intermediaries. The
amount of each share class's Rule 12b-1 fee, if any, is disclosed below and 
in a Fund's fee table included in Summary Information section above.        

ASSET-BASED SALES CHARGES OR DISTRIBUTION AND/OR SERVICE (RULE 12B-1) FEES      
Each Fund has adopted a plan under Commission Rule 12b-1 that allows the Fund   
to pay asset-based sales charges or distribution and/or service (Rule 12b-1)    
fees for the distribution and sale of its shares. The amount of these fees for  
each class of the Fund's shares is:                                             

                                                                [Download Table]

         DISTRIBUTION AND/OR SERVICE
           (RULE 12B-1) FEE (AS A   
           PERCENTAGE OF AGGREGATE  
          AVERAGE DAILY NET ASSETS) 
------------------------------------
                                    
Class A             .30%            
Class R             .50%            
Class K             .25%            
Class I             None            

30                                                                              

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Because these fees are paid out of a Fund's assets on an ongoing basis, over    
time these fees will increase the cost of your investment and may cost you more 
than paying other types of sales fees. Class R shares are subject to higher     
Rule 12b-1 fees than Class A shares. Because higher fees mean a higher expense  
ratio, Class R shares pay correspondingly lower dividends and may have a lower  
NAV (and returns) than Class A shares. Conversely, Class K and Class I shares   
have a lower or no Rule 12b-1 fee. Therefore, Class K and Class I shares have a 
lower expense ratio and may have a higher NAV (and returns) than Class A or     
Class R shares. All or some of these fees may be paid to financial              
intermediaries, including your financial intermediary.                          

CLASS A SHARES                                                                  
Class A shares offered through this Prospectus do not have an initial sales     
charge. Class A shares may be subject to a CDSC of up to 1%. Purchases of       
Class A shares by AllianceBernstein or non-AllianceBernstein-sponsored group    
retirement plans may be subject to a 1% CDSC if terminated within one year. The 
CDSC is applied to the lesser of NAV at the time of redemption of shares or the 
original cost of shares being redeemed.                                         

CLASS R, CLASS K AND CLASS I SHARES                                             
Class R, Class K and Class I shares do not have an initial sales charge or CDSC.

DISTRIBUTION ARRANGEMENTS FOR GROUP RETIREMENT PLANS                            
Each Fund offers distribution arrangements for group retirement plans. Plan     
sponsors, plan fiduciaries and other financial intermediaries may establish     
requirements for group retirement plans as to the purchase, sale or exchange of 
shares of a Fund, including maximum and minimum initial investment              
requirements, that are different from those described in this Prospectus and    
the Funds' SAI. Group retirement plans also may not offer all classes of shares 
of a Fund. A Fund is not responsible for, and has no control over, the decision 
of any plan sponsor or fiduciary to impose such differing requirements.         

PAYMENTS TO FINANCIAL INTERMEDIARIES                                            
Financial intermediaries market and sell shares of the Funds. These financial   
intermediaries may receive compensation for selling shares of the Funds. This   
compensation is paid from various sources, including any CDSC, and/or Rule      
12b-1 fee that you or the Funds may pay.                                        

WHAT IS A FINANCIAL INTERMEDIARY? 
A financial intermediary is a firm that receives compensation for selling   
shares of the Funds offered in this Prospectus and/or provides services to  
the Funds' shareholders. Financial intermediaries may include, among others,
brokers, financial planners or advisors, banks and insurance companies.     
Financial intermediaries may employ financial advisors who deal with you and
other investors on an individual basis.                                     

ABI may pay financial intermediaries selling Class A shares a fee of up to 1%.  
Up to 100% of the Rule 12b-1 fees applicable to Class A shares each year may be 
paid to financial intermediaries, including your financial intermediary, that   
sell Class A shares.                                                            

For Class R and Class K shares, up to 100% of the Rule 12b-1 fee applicable to  
these classes of shares each year may be paid to financial intermediaries,      
including your financial intermediary, that sell Class R and Class K shares.    

Your financial advisor's firm receives compensation from the Funds, ABI,    
and/or the Adviser in several ways from various sources, which include some 
or all of the following:                                                    

- Rule 12b-1 fees;                                                          
- additional distribution support;                                          
- defrayal of costs for educational seminars and training; and              
- payments related to providing shareholder recordkeeping and/or transfer   
agency services.                                                        

Please read the Prospectus carefully for information on this compensation.  

OTHER PAYMENTS FOR DISTRIBUTION SERVICES AND EDUCATIONAL SUPPORT                
In addition to the Rule 12b-1 fees described above, some or all of which may be 
paid to financial intermediaries, ABI, at its expense, currently provides       
additional payments to firms that sell shares of the AllianceBernstein Mutual   
Funds. Although the individual components may be higher and the total amount of 
payments made to each qualifying firm in any given year may vary, the total     
amount paid to a financial intermediary in connection with the sale of shares   
of the AllianceBernstein Mutual Funds will generally not exceed the sum of      
(a) 0.25% of the current year's fund sales by that firm and (b) 0.10% of        
average daily net assets attributable to that firm over the year. These sums    
include payments to reimburse directly or indirectly the costs incurred by      
these firms and their employees in connection with educational seminars and     
training efforts about the AllianceBernstein Mutual Funds for the firms'        
employees and/or their clients and potential clients. The costs and expenses    
associated with these efforts may include travel, lodging, entertainment and    
meals. ABI may pay a portion of "ticket" or other transactional charges.        

For 2011, ABI's additional payments to these firms for distribution services    
and educational support related to the AllianceBernstein Mutual Funds are       
expected to be approximately 0.04% of the average monthly assets of the         
AllianceBernstein Mutual Funds, or approximately $18.0 million. In 2010, ABI    
paid approximately 0.04% of the average monthly assets of the AllianceBernstein 
Mutual Funds or approximately $16.5 million for distribution services and       
educational support related to the AllianceBernstein Mutual Funds.              

A number of factors are considered in determining the additional payments,      
including each firm's AllianceBernstein Mu-                                     

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tual Fund sales, assets and redemption rates, and the willingness and ability   
of the firm to give ABI access to its financial advisors for educational and    
marketing purposes. In some cases, firms will include the AllianceBernstein     
Mutual Funds on a "preferred list." ABI's goal is to make the financial         
intermediaries who interact with current and prospective investors and          
shareholders more knowledgeable about the AllianceBernstein Mutual Funds so     
that they can provide suitable information and advice about the funds and       
related investor services.                                                      

The Funds and ABI also make payments for recordkeeping and other transfer       
agency services to financial intermediaries that sell AllianceBernstein Mutual  
Fund shares. Please see "Management of the Funds--Transfer Agency and           
Retirement Plan Services" below. These expenses paid by the Funds are included  
in "Other Expenses" under "Fees and Expenses of the Fund--Annual Fund Operating 
Expenses" in the Summary Information at the beginning of the Prospectus.        

IF ONE MUTUAL FUND SPONSOR MAKES GREATER DISTRIBUTION ASSISTANCE PAYMENTS   
THAN ANOTHER, YOUR FINANCIAL INTERMEDIARY MAY HAVE AN INCENTIVE TO RECOMMEND
ONE FUND COMPLEX OVER ANOTHER. SIMILARLY, IF YOUR FINANCIAL ADVISOR AND HIS 
OR HER FIRM RECEIVES MORE DISTRIBUTION ASSISTANCE FOR ONE SHARE CLASS VERSUS
ANOTHER, THE FINANCIAL INTERMEDIARY MAY HAVE AN INCENTIVE TO RECOMMEND THAT 
CLASS.                                                                      

As of the date of the Prospectus, ABI anticipates that the firms that will      
receive additional payments for distribution services and/or educational        
support include:                                                                

Advisor Group, Inc.                                                         
Ameriprise Financial Services                                               
AXA Advisors                                                                
Bank of America                                                             
Cadaret, Grant & Co.                                                        
CCO Investment Services Corp.                                               
Chase Investment Services                                                   
Commonwealth Financial Network                                              
Donegal Securities                                                          
Financial Network Investment Company                                        
LPL Financial Corporation                                                   
Merrill Lynch                                                               
Morgan Stanley Smith Barney                                                 
Multi-Financial Securities Corporation                                      
Northwestern Mutual Investment Services                                     
PrimeVest Financial Services                                                
Raymond James                                                               
RBC Wealth Management                                                       
Robert W. Baird                                                             
UBS Financial Services                                                      
Wells Fargo Advisors                                                        
Wells Fargo Investments                                                     

Although the Funds may use brokers and dealers that sell shares of the Funds to 
effect portfolio transactions, the Funds do not consider the sale of            
AllianceBernstein Mutual Fund shares as a factor when selecting brokers or      
dealers to effect portfolio transactions.                                       

HOW TO EXCHANGE SHARES                                                          
You may exchange your Fund shares for shares of the same class of other         
AllianceBernstein Mutual Funds (including AllianceBernstein Exchange Reserves,  
a money market fund managed by the Adviser) provided that the other fund offers 
the same class of shares. Exchanges of shares are made at the next-determined   
NAV, without sales or service charges. All exchanges are subject to the minimum 
investment restrictions set forth in the prospectus for the AllianceBernstein   
Mutual Fund whose shares are being acquired. Your exchange of shares is priced  
at the next-determined NAV after your order is received in proper form. You may 
request an exchange by mail or telephone. In order to receive a day's NAV,      
AllianceBernstein Investor Services, Inc., or ABIS, must receive and confirm    
your telephone exchange request by 4:00 p.m., Eastern time, on that day. The    
Funds may modify, restrict or terminate the exchange privilege on 60 days'      
written notice.                                                                 

HOW TO SELL OR REDEEM SHARES                                                    
You may "redeem" your shares (i.e., sell your shares to a Fund) on any day the  
New York Stock Exchange, or Exchange, is open. Your sale price will be the      
next-determined NAV, less any applicable CDSC, after the Fund receives your     
redemption request in proper form. Normally, redemption proceeds are sent to    
you within seven days. If you recently purchased your shares by check or        
electronic funds transfer, your redemption payment may be delayed until the     
Fund is reasonably satisfied that the check or electronic funds transfer has    
been collected (which may take up to 15 days).                                  

Your financial intermediary must receive your sales request by 4:00 p.m.,       
Eastern time, and submit it to the Fund by a pre-arranged time for you to       
receive the next-determined NAV, less any applicable CDSC. Your financial       
intermediary is responsible for submitting all necessary documentation to the   
Fund and may charge you a fee for this service.                                 

FREQUENT PURCHASES AND REDEMPTIONS OF FUND SHARES                               
Each Fund's Board has adopted policies and procedures designed to detect and    
deter frequent purchases and redemptions of Fund shares or excessive or         
short-term trading that may disadvantage long-term Fund shareholders. These     
policies are described below. There is no guarantee that the Funds will be able 
to detect excessive or short-term trading and to identify shareholders engaged  
in such practices, particularly with respect to transactions in omnibus         
accounts. Shareholders should be aware that application of these policies may   
have adverse consequences, as described below, and avoid frequent trading in    
Fund shares through purchases, sales and exchanges of shares. Each Fund         
reserves the right to restrict, reject, or cancel, without any prior notice,    
any purchase or exchange order for any reason, including any purchase or        
exchange order accepted by any shareholder's financial intermediary.            

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RISKS ASSOCIATED WITH EXCESSIVE OR SHORT-TERM TRADING GENERALLY. While the      
Funds will try to prevent market timing by utilizing the procedures described   
below, these procedures may not be successful in identifying or stopping        
excessive or short-term trading in all circumstances. By realizing profits      
through short-term trading, shareholders that engage in rapid purchases and     
sales or exchanges of a Fund's shares dilute the value of shares held by        
long-term shareholders. Volatility resulting from excessive purchases and sales 
or exchanges of Fund shares, especially involving large dollar amounts, may     
disrupt efficient portfolio management and cause a Fund to sell shares at       
inopportune times to accommodate redemptions relating to short-term trading. In 
particular, a Fund may have difficulty implementing its long-term investment    
strategies if it is forced to maintain a higher level of its assets in cash to  
accommodate significant short-term trading activity. In addition, a Fund may    
incur increased administrative and other expenses due to excessive or           
short-term trading, including increased brokerage costs and realization of      
taxable capital gains.                                                          

Funds that may invest significantly in foreign securities may be particularly   
susceptible to short-term trading strategies. This is because foreign           
securities are typically traded on markets that close well before the time a    
Fund calculates its NAV at 4:00 p.m., Eastern time, which gives rise to the     
possibility that developments may have occurred in the interim that would       
affect the value of these securities. The time zone differences among           
international stock markets can allow a shareholder engaging in a short-term    
trading strategy to exploit differences in Fund share prices that are based on  
closing prices of foreign securities established some time before the Fund      
calculates its own share price (referred to as "time zone arbitrage"). The      
Funds have procedures, referred to as fair value pricing, designed to adjust    
closing market prices of foreign securities to reflect what is believed to be   
the fair value of those securities at the time a Fund calculates its NAV. While 
there is no assurance, the Funds expect that the use of fair value pricing, in  
addition to the short-term trading policies discussed below, will significantly 
reduce a shareholder's ability to engage in time zone arbitrage to the          
detriment of other Fund shareholders.                                           

A shareholder engaging in a short-term trading strategy may also target a Fund  
that does not invest primarily in foreign securities. Any Fund that invests in  
securities that are, among other things, thinly traded, traded infrequently or  
relatively illiquid, has the risk that the current market price for the         
securities may not accurately reflect current market values. A shareholder may  
seek to engage in short-term trading to take advantage of these pricing         
differences (referred to as "price arbitrage"). All Funds may be adversely      
affected by price arbitrage.                                                    

POLICY REGARDING SHORT-TERM TRADING. Purchases and exchanges of shares of the   
Funds should be made for investment purposes only. The Funds will seek to       
prevent patterns of excessive purchases and sales of Fund shares to the extent  
they are detected by the procedures described below. The Funds reserve the      
right to modify this policy, including any surveillance or account blocking     
procedures established from time to time to effectuate this policy, at any time 
without notice.                                                                 

..  TRANSACTION SURVEILLANCE PROCEDURES. The Funds, through their agents, ABI   
  and ABIS, maintain surveillance procedures to detect excessive or short-term
 trading in Fund shares. This surveillance process involves several factors,
which include scrutinizing transactions in Fund shares that exceed certain
monetary thresholds or numerical limits within a specified period of time.
Generally, more than two exchanges of Fund shares during any 90-day period
 or purchases of shares followed by a sale within 90 days will be identified
by these surveillance procedures. For purposes of these transaction       
  surveillance procedures, the Funds may consider trading activity in multiple
accounts under common ownership, control or influence. Trading activity   
 identified by either, or a combination, of these factors, or as a result of
 any other information available at the time, will be evaluated to determine
whether such activity might constitute excessive or short-term trading.   
These surveillance procedures may be modified from time to time, as       
  necessary or appropriate to improve the detection of excessive or short-term
trading or to address specific circumstances.                             

..  ACCOUNT BLOCKING PROCEDURES. If the Funds determine, in their sole          
discretion, that a particular transaction or pattern of transactions      
identified by the transaction surveillance procedures described above is  
  excessive or short-term trading in nature, the relevant Fund account(s) will
  be immediately "blocked" and no future purchase or exchange activity will be
 permitted. However, sales of Fund shares back to a Fund or redemptions will
 continue to be permitted in accordance with the terms of the Fund's current
Prospectus. As a result, unless the shareholder redeems his or her shares,
 which may have consequences if the shares have declined in value, a CDSC is
applicable or adverse tax consequences may result, the shareholder may be 
 "locked" into an unsuitable investment. In the event an account is blocked,
certain account-related privileges, such as the ability to place purchase,
sale and exchange orders over the internet or by phone, may also be       
 suspended. A blocked account will generally remain blocked unless and until
the account holder or the associated broker, dealer or other financial    
 intermediary provides evidence or assurance acceptable to the Fund that the
account holder did not or will not in the future engage in excessive or   
short-term trading.                                                       

..  APPLICATIONS OF SURVEILLANCE PROCEDURES AND RESTRICTIONS TO OMNIBUS         
  ACCOUNTS. Omnibus account arrangements are common forms of holding shares of
the Funds, particularly among certain brokers, dealers and other financial
intermediaries, including sponsors of retirement plans and variable       
insurance products. The Funds apply their surveillance procedures to these
omnibus account arrangements. As required by Commission rules, the Funds  
  have entered into agreements with all of their financial intermediaries that
 require the financial intermediaries to provide the Funds, upon the request
of the Funds or their agents, with individual account level information   
about their trans-                                                        

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actions. If the Funds detect excessive trading through their monitoring of    
omnibus accounts, including trading at the individual account level, the      
financial intermediaries will also execute instructions from the Funds to take
actions to curtail the activity, which may include applying blocks to accounts
to prohibit future purchases and exchanges of Fund shares. For certain        
retirement plan accounts, the Funds may request that the retirement plan or   
other intermediary revoke the relevant participant's privilege to effect      
transactions in Fund shares via the internet or telephone, in which case the  
relevant participant must submit future transaction orders via the U.S. Postal
Service (i.e., regular mail).                                                 

HOW THE FUNDS VALUE THEIR SHARES                                                
Each Fund's NAV is calculated at the close of regular trading on the Exchange   
(ordinarily, 4:00 p.m., Eastern time), only on days when the Exchange is open   
for business. To calculate NAV, a Fund's assets are valued and totaled,         
liabilities are subtracted, and the balance, called net assets, is divided by   
the number of shares outstanding. If a Fund invests in securities that are      
primarily traded on foreign exchanges that trade on weekends or other days when 
the Fund does not price its shares, the NAV of the Fund's shares may change on  
days when shareholders will not be able to purchase or redeem their shares in   
the Fund.                                                                       

The Funds value their securities at their current market value determined on    
the basis of market quotations or, if market quotations are not readily         
available or are unreliable, at "fair value" as determined in accordance with   
procedures established by and under the general supervision of each Fund's      
Board. When a Fund uses fair value pricing, it may take into account any        
factors it deems appropriate. A Fund may determine fair value based upon        
developments related to a specific security, current valuations of foreign      
stock indices (as reflected in U.S. futures markets) and/or U.S. sector or      
broader stock market indices. The prices of securities used by the Fund to      
calculate its NAV may differ from quoted or published prices for the same       
securities. Fair value pricing involves subjective judgments and it is possible 
that the fair value determined for a security is materially different than the  
value that could be realized upon the sale of that security.                    

Funds expect to use fair value pricing for securities primarily traded on U.S.  
exchanges only under very limited circumstances, such as the early closing of   
the exchange on which a security is traded or suspension of trading in the      
security. Funds may use fair value pricing more frequently for securities       
primarily traded in non-U.S. markets because, among other things, most foreign  
markets close well before a Fund values its securities at 4:00 p.m., Eastern    
time. The earlier close of these foreign markets gives rise to the possibility  
that significant events, including broad market moves, may have occurred in the 
interim. For example, the Funds believe that foreign security values may be     
affected by events that occur after the close of foreign securities markets. To 
account for this, the Funds may frequently value many of their foreign equity   
securities using fair value prices based on third party vendor modeling tools   
to the extent available.                                                        

Subject to the Board's oversight, each Fund's Board has delegated               
responsibility for valuing a Fund's assets to the Adviser. The Adviser has      
established a Valuation Committee, which operates under the policies and        
procedures approved by the Board, to value the Fund's assets on behalf of the   
Fund. The Valuation Committee values Fund assets as described above.            

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MANAGEMENT OF THE FUNDS                                                         
--------------------------------------------------------------------------------

INVESTMENT ADVISER                                                              
Each Fund's adviser is AllianceBernstein L.P., 1345 Avenue of the Americas, New 
York, New York 10105. The Adviser is a leading international investment adviser 
supervising client accounts with assets as of September 30, 2010, totaling      
approximately $484 billion (of which more than $81 billion represented assets   
of investment companies). As of September 30, 2010, the Adviser managed         
retirement assets for many of the largest public and private employee benefit   
plans (including 33 of the nation's FORTUNE 100 companies), for public employee 
retirement funds in 38 states, for investment companies, and for foundations,   
endowments, banks and insurance companies worldwide. Currently, the 35          
registered investment companies managed by the Adviser, comprising 115 separate 
investment portfolios, have approximately 3.2 million retail accounts.          

The Adviser provides investment advisory services and order placement           
facilities for each of the Funds. For these advisory services, each Fund paid   
the Adviser during the most recent fiscal year a management fee as a percentage 
of average daily net assets as follows:                                         

                                                                [Download Table]

                                     FEE AS A PERCENTAGE OF            
                                       AVERAGE DAILY NET    FISCAL YEAR
FUND                                         ASSETS            ENDED   
-----------------------------------------------------------------------
                                                                       
AllianceBernstein Intermediate Bond           .25%*          10/31/10  
AllianceBernstein Global Bond                 .45%            9/30/10  
AllianceBernstein Diversified Yield           .00%*          10/31/10  
AllianceBernstein High Income                 .45%           10/31/10  

*Fee stated net of any waivers and/or reimbursements. See "Fees and Expenses of 
the Fund" in the Summary Information at the beginning of the Prospectus for   
more information about fee waivers.                                           

A discussion regarding the basis for the Board's approval of each Fund's        
investment advisory agreement is available in the Fund's semi-annual report to  
shareholders.                                                                   

The Adviser may act as an investment adviser to other persons, firms, or        
corporations, including investment companies, hedge funds, pension funds, and   
other institutional investors. The Adviser may receive management fees,         
including performance fees, that may be higher or lower than the advisory fees  
it receives from the Funds. Certain other clients of the Adviser may have       
investment objectives and policies similar to those of a Fund. The Adviser may, 
from time to time, make recommendations that result in the purchase or sale of  
a particular security by its other clients simultaneously with a Fund. If       
transactions on behalf of more than one client during the same period increase  
the demand for securities being purchased or the supply of securities being     
sold, there may be an adverse effect on price or quantity. It is the policy of  
the Adviser to allocate advisory recommendations and the placing of orders in a 
manner that is deemed equitable by the Adviser to the accounts involved,        
including a Fund. When two or more of the clients of the Adviser (including a   
Fund) are purchasing or selling the same security on a given day from the same  
broker-dealer, such transactions may be averaged as to price.                   

PORTFOLIO MANAGERS                                                              
The management of, and investment decisions for, the Funds' portfolios are made 
by certain Investment Policy Teams. Each Investment Policy Team relies heavily  
on the fundamental analysis and research of the Adviser's large internal        
research staff. No one person is principally responsible for coordinating each  
Fund's investments.                                                             

The following table lists the Investment Policy Teams, the person within each   
Investment Policy Team with the most significant responsibility for day-to-day  
management of each Fund's portfolio, the length of time that each person has    
been jointly and primarily responsible for the Fund, and each person's          
principal occupation during the past five years:                                

     FUND AND                                    PRINCIPAL OCCUPATION(S)
    RESPONSIBLE                                   DURING THE PAST FIVE (5)
TEAM             EMPLOYEE; YEAR; TITLE             YEARS  
----------------------------------------------------------------------------- 
AllianceBernstein         Alison M. Martier; since  Senior Vice President of  
Intermediate Bond         2005; Senior Vice         the Adviser, with which   
Portfolio                 President of the Adviser  she has been associated   
U.S. Investment Grade     and Director of the       in a substantially        
Core Fixed Income Team    Fixed Income Senior       similar capacity to her   
                      Portfolio Management Team current position since
                                        prior to 2006.

                        Greg J. Wilensky; since   Senior Vice President of
                       2005; Senior Vice         the Adviser, with which
                      President of the Adviser  he has been associated
                  and Director of Stable    in a substantially
                       Value Investments         similar capacity to his
                                                current position since
                                        prior to 2006.

                     Shawn E. Keegan; since    Vice President of the
                      2005; Vice President of   Adviser, with which he
                        the Adviser               has been associated in a
                                               substantially similar
                                                 capacity to his current
                                                 position since prior to
                               2006.

                        Douglas J. Peebles;       Senior Vice President of
                       since 2007; Senior Vice   the Adviser, with which
                      President of the          he has been associated
                  Adviser; and Chief        in a substantially
                       Investment Officer and    similar capacity to his
                      Head of Fixed Income      current position since
                                        prior to 2006.

                        Paul J. DeNoon; since     Senior Vice President of
                       2009; Senior Vice         the Adviser, with which
                      President of the Adviser  he has been associated
                  and Director of Emerging  in a substantially
                       Market Debt               similar capacity to his
                                                current position since
                                        prior to 2006.

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     FUND AND                                    PRINCIPAL OCCUPATION(S)
    RESPONSIBLE                                   DURING THE PAST FIVE (5)
TEAM             EMPLOYEE; YEAR; TITLE             YEARS  
----------------------------------------------------------------------------- 
AllianceBernstein Global  Paul J. DeNoon; since     (see above)               
Bond Fund                 2002; (see above)                                   
Global Fixed Income                                 Senior Vice President of  
Investment Team           Scott DiMaggio; since     the Adviser, with which   
                      2005; Senior Vice         he has been associated
                  President of the Adviser  in a substantially
                       and Director of Canada    similar capacity to his
                      Fixed Income              current position since
                                        prior to 2006.

                     Michael L. Mon; since     Vice President of the
                      2003; Vice President of   Adviser, with which he
                        the Adviser               has been associated in a
                                               substantially similar
                                                 capacity to his current
                                                 position since prior to
                               2006.

           Douglas J. Peebles;       (see above)
since 1992; (see above)   

                     Matthew S. Sheridan;      Vice President of the
                      since 2007; Vice          Adviser, with which he
                        President of the Adviser  has been associated in a
                                               substantially similar
                                                 capacity to his current
                                                 position since prior to
                               2006.

AllianceBernstein         Paul J. DeNoon; since     (see above)               
Diversified Yield Fund    2005; (see above)         Vice President of the     
Global Fixed Income       Joran Laird; since 2009;  Adviser, with which he    
Investment Team and       Vice President of the     has been associated in a  
Global Credit Investment  Adviser                   substantially similar     
Team                                                capacity to his current   
                                                 position since prior to
                               2006.

           Douglas J. Peebles;       (see above)
since 1996; (see above)   

           Matthew S. Sheridan;      (see above)
since 2006; (see above)   

           Greg J. Wilensky; since   (see above)
2008; (see above)         

AllianceBernstein High    Paul J. DeNoon; since     (see above)               
Income Fund               2002; (see above)         Senior Vice President of  
Global Fixed Income       Gershon M. Distenfeld;    the Adviser, with which   
Investment Team and       since 2008; Senior Vice   he has been associated    
Global Credit Investment  President of the Adviser  in a substantially        
Team                                                similar capacity to his   
                                                current position since
                                        prior to 2006.

           Douglas J. Peebles;       (see above)
since 2002; (see above)   

                     Marco Santamaria; since   Vice President of the
                      2010; Vice President of   Adviser, with which he
                        the Adviser               has been associated in a
                                               substantially similar
                                                 capacity to his current
                                             position since June
                                                 2010. Prior thereto, he
                                                was a founding partner
                                              at Global Securities
                                      Advisors, an
                                                  emerging-market-oriented
                                                 fixed-income hedge fund
                                              since prior to 2006.

           Matthew S. Sheridan;      (see above)
since 2005; (see above)   

Additional information about the portfolio managers may be found in the Funds'  
SAI.                                                                            

PERFORMANCE OF A SIMILARLY MANAGED PORTFOLIO                                    
The investment teams employed by the Adviser to manage ALLIANCEBERNSTEIN HIGH   
INCOME FUND and ALLIANCEBERNSTEIN INTERMEDIATE BOND PORTFOLIO have substantial  
experience in managing discretionary accounts of institutional clients, pooled  
investment vehicles and/or other registered investment companies and portions   
thereof (the "Historical Accounts") that have substantially the same investment 
objectives and policies and are managed in accordance with essentially the same 
investment strategies as the Funds. The Historical Accounts that are not        
registered investment companies are not subject to certain limitations,         
diversification requirements and other restrictions imposed under the 1940 Act  
and the Internal Revenue Code (the "Code") to which the Funds, as registered    
investment companies, are subject and which, if applicable to the Historical    
Accounts, may have adversely affected the performance of the Historical         
Accounts. With respect to ALLIANCEBERNSTEIN HIGH INCOME FUND, the Historical    
Accounts' performance information is representative solely of the performance   
of a pooled investment vehicle that is not offered for sale in the United       
States.                                                                         

Set forth below is performance data provided by the Adviser relating to the     
Historical Accounts managed by the investment team that manages each Fund's     
assets. Performance data is shown for the period during which the investment    
teams of the Adviser managed the Historical Accounts through December 31, 2010. 
The aggregate assets for the Historical Accounts managed by the High Income     
investment team and the Intermediate Bond investment team as of September 30,   
2010 were approximately $26.6 billion and $15.6 billion, respectively. The      
investment teams' Historical Accounts have a nearly identical composition of    
representative investment holdings and related percentage weightings.           

The performance data is net of all fees (including any portfolio transaction    
costs) charged to the Historical Accounts, calculated on a monthly basis. The   
highest fee payable for the Historical Accounts is 2.04% of assets for          
ALLIANCEBERNSTEIN HIGH INCOME FUND and .91% of assets for ALLIANCEBERNSTEIN     
INTERMEDIATE BOND PORTFOLIO, annually. Net-of-fee performance figures reflect   
the compounding effect of such fees.                                            

The data has not been adjusted to reflect any fees that will be payable by the  
Funds, which may be higher than the fees imposed on the Historical Accounts,    
and will reduce the returns of the Funds. Expenses associated with the          
distribution of Class A, Class R and Class K shares of the Funds in accordance  
with the plans adopted by the Boards of the Funds under                         

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Commission Rule 12b-1 are also excluded. Except as noted, the performance data  
has also not been adjusted for corporate or individual taxes, if any, payable   
by account owners.                                                              

The Adviser has calculated the investment performance of the Historical         
Accounts on a trade-date basis. Income has been accrued daily and cash flows    
weighted daily. Composite investment performance for the Funds has been         
determined on an asset weighted basis. New accounts are included in the         
composite investment performance computations at the beginning of the quarter   
following the initial contribution. The total returns set forth below are       
calculated using a method that links the monthly return amounts for the         
disclosed periods, resulting in a time-weighted rate of return. Other methods   
of computing the investment performance of the Historical Accounts may produce  
different results, and the results for different periods may vary.              

A composite benchmark, comprised of the JPMorgan Emerging Markets Bond Index    
Global ("EMBI Global"), the JPMorgan Government Bond Index-Emerging Markets     
("GBI-EM") and the Barclays Capital High Yield Index (2% Constrained) ("BC High 
Yield") on an equal weighted basis (the "High Income Composite Benchmark") is   
used by High Income and its Historical Account, for purposes of this example,   
as a benchmark to measure its relative performance. EMBI Global tracks total    
returns for traded external debt instruments in the emerging markets, GBI-EM    
tracks total returns for local currency government bonds issued by emerging     
markets, and BC High                                                            
Yield tracks the U.S. Dollar-denominated, non-investment grade, fixed-rate,     
taxable corporate bond market.                                                  

The Barclays Capital Aggregate Index ("BC Aggregate Index") is used by          
ALLIANCEBERNSTEIN INTERMEDIATE BOND PORTFOLIO as a benchmark to measure its     
relative performance and is composed of securities from Barclays Capital        
Government/Corporate Bond Index, Mortgage-Backed Securities Index, and the      
Asset-Backed Securities Index. The index's total return consists of price       
appreciation/depreciation plus income as a percentage of the original           
investment. Indices are rebalanced monthly by market capitalization.            

To the extent the investment teams utilize investment techniques such as swaps, 
futures or options, the performance of the High Income Composite Benchmark and  
the BC Aggregate Index may not be substantially comparable to the performance   
of the investment teams' Historical Accounts. The High Income Composite         
Benchmark and the BC Aggregate Index do not reflect the deduction of any fees   
or expenses associated with the active management of a mutual fund.             

The performance data below is provided solely to illustrate the investment      
teams' performance in managing the Historical Accounts as measured against a    
broad based market index. The performance of the Funds will be affected by the  
performance of the investment teams managing the Funds' assets. If the          
investment teams were to perform relatively poorly, the performance of the      
Funds would suffer. Investors should not rely on the performance data of the    
Historical Accounts as an indication of future performance of the Funds.        

The investment performance for the periods presented may not be indicative of   
future rates of return. The performance was not calculated pursuant to the      
methodology established by the Commission that will be used to calculate the    
Funds' performance. The use of methodology different from that used to          
calculate performance could result in different performance data.               

SCHEDULE OF HISTORICAL PERFORMANCE - HISTORICAL ACCOUNTS*                       

                                                        [Enlarge/Download Table]

                                                              HIGH INCOME     HIGH INCOME                                     
                                                           HISTORICAL ACCOUNT  COMPOSITE                           BC HIGH    
                                                             TOTAL RETURN**    BENCHMARK  EMBI GLOBAL*** GBI-EM YIELD INDEX***
------------------------------------------------------------------------------------------------------------------------------
                                                                                                                              
Year Ended December 31:                                                                                                       
2010                                                             15.62%          14.01%       12.04%     13.08%     14.94%    
2009                                                             60.62%          33.73%       28.18%     16.56%     58.76%    
2008                                                            -32.27%         -14.79%      -10.91%     -6.93%    -25.88%    
2007                                                              5.91%           8.19%        6.28%     16.28%      2.26%    
2006                                                             12.56%          10.97%        9.88%     11.96%     10.76%    
2005                                                              7.99%           5.46%       10.73%      2.87%      2.76%    
2004                                                             11.11%          15.36%       11.73%     23.12%     11.14%    
2003                                                             36.36%          24.06%       25.66%     17.79%     28.78%    
2002                                                              5.26%          13.66%       13.11%     29.11%      -.24%    
2001                                                            -10.44%             N/A        1.36%        N/A      5.46%    
2000                                                             -4.25%             N/A       14.41%        N/A     -5.79%    
1999                                                             18.76%             N/A       24.18%        N/A      2.39%    
1998                                                            -15.60%             N/A      -11.54%        N/A      1.87%    
Cumulative total return for the period September 22, 1997                                                                     
 (inception of Historical Account) to December 31, 2010         121.73%             N/A      234.63%***     N/A    132.90%*** 
------------------------------------------------------------------------------------------------------------------------------

*  Total return is a measure of investment performance that is based upon the   
change in value of an investment from the beginning to the end of a       
specified period and assumes reinvestment of all dividends and other      
distributions. The basis of presentation of this data is described in the 
preceding discussion.                                                     

** Net of all fees.                                                             

***Net inception cumulative index returns are from December 31, 1997.           

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                                                        [Enlarge/Download Table]

                                                              INTERMEDIATE BOND   BC U.S. 
                                                             HISTORICAL ACCOUNTS AGGREGATE
                                                               TOTAL RETURN**      INDEX  
------------------------------------------------------------------------------------------
                                                                                          
Year Ended December 31:                                                                   
2010                                                                9.45%          6.54%  
2009                                                               18.77%          5.93%  
2008                                                               -5.41%          5.24%  
2007                                                                5.60%          6.97%  
2006                                                                5.26%          4.33%  
2005                                                                3.22%          2.43%  
2004                                                                5.48%          4.34%  
2003                                                                8.45%          4.10%  
2002                                                                7.93%         10.26%  
Cumulative total return for the period June 30, 2001                                      
 (inception of Historical Accounts) to December 31, 2010           81.89%         70.18%  
------------------------------------------------------------------------------------------

*  Total return is a measure of investment performance that is based upon the   
change in value of an investment from the beginning to the end of a       
specified period and assumes reinvestment of all dividends and other      
distributions. The basis of presentation of this data is described in the 
preceding discussion.                                                     

** Net of all fees.                                                             

AVERAGE ANNUAL TOTAL RETURNS AS OF DECEMBER 31, 2010                            

                                                                [Download Table]

                                                                   SINCE  
                                 1 YEAR 3 YEARS 5 YEARS 10 YEARS INCEPTION
--------------------------------------------------------------------------
                                                                          
High Income Historical Account   15.62%  7.94%   8.44%    8.75%    6.18%* 
High Income Composite Benchmark  14.01%  9.12%   9.30%      N/A      N/A  
  EMBI Global                    12.04%  8.56%   8.36%   10.29%    9.74%**
  GBI-EM                         13.08%  7.06%   9.82%      N/A      N/A  
  BC High Yield                  14.94% 10.59%   8.91%    9.01%    6.72%**
--------------------------------------------------------------------------

*  Inception date of Historical Account is September 22, 1997.                  

** Since inception average annual total returns are from December 31, 1997.     

                                                                [Download Table]

                                                                SINCE  
                                       1 YEAR 3 YEARS 5 YEARS INCEPTION
-----------------------------------------------------------------------
                                                                       
Intermediate Bond Historical Accounts  9.45%   7.13%   6.45%    6.50%* 
BC U.S. Aggregate Index                6.54%   5.90%   5.80%    5.76%* 

*  Inception date of Historical Accounts is June 30, 2001.                      

TRANSFER AGENCY AND RETIREMENT PLAN SERVICES                                    
ABIS acts as the transfer agent for the Funds. ABIS, an indirect wholly-owned   
subsidiary of the Adviser, registers the transfer, issuance, and redemption of  
Fund shares and disburses dividends and other distributions to Fund             
shareholders.                                                                   

Retirement plans may also hold Fund shares in the name of the plan, rather than 
the participant. Plan recordkeepers, who may have affiliated financial          
intermediaries who sell shares of the Funds, may be paid for each participant   
fund account in amounts up to $19 per customer fund account per annum and/or up 
to 0.25% per annum of the average daily assets held in the plan. To the extent  
any of these payments for recordkeeping services, transfer agency services or   
retirement plan accounts are made by the Funds, they are included in the amount 
appearing opposite the caption "Other Expenses" found in the Fund expense       
tables under "Fees and Expenses of the Fund" in the Summary Information at the  
beginning of the Prospectus. In addition, financial intermediaries may be       
affiliates of entities that receive compensation from the Adviser or ABI for    
maintaining retirement plan "platforms" that facilitate trading by affiliated   
and non-affiliated financial intermediaries and recordkeeping for retirement    
plans.                                                                          

Because financial intermediaries and plan recordkeepers may be paid varying     
amounts per class for sub-transfer agency and related recordkeeping services,   
the service requirements of which may also vary by class, this may create an    
additional incentive for financial intermediaries and their financial advisors  
to favor one fund complex over another or one class of shares over another.     

38                                                                              

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DIVIDENDS, DISTRIBUTIONS AND TAXES                                              
--------------------------------------------------------------------------------

Each Fund's income dividends and capital gains distributions, if any, declared  
by a Fund on its outstanding shares will, at the election of each shareholder,  
be paid in cash or in additional shares of the same class of shares of that     
Fund. If paid in additional shares, the shares will have an aggregate NAV as of 
the close of business on the declaration date of the dividend or distribution   
equal to the cash amount of the dividend or distribution. You may make an       
election to receive dividends and distributions in cash or in shares at the     
time you purchase shares. Your election can be changed at any time prior to a   
record date for a dividend. There is no sales or other charge in connection     
with the reinvestment of dividends or capital gains distributions. Cash         
dividends may be paid by check, or at your election, electronically via the ACH 
network.                                                                        

If you receive an income dividend or capital gains distribution in cash you     
may, within 120 days following the date of its payment, reinvest the dividend   
or distribution in additional shares of that Fund without charge by returning   
to the Adviser, with appropriate instructions, the check representing the       
dividend or distribution. Thereafter, unless you otherwise specify, you will be 
deemed to have elected to reinvest all subsequent dividends and distributions   
in shares of that Fund.                                                         

While it is the intention of each Fund to distribute to its shareholders        
substantially all of each fiscal year's net income and net realized capital     
gains, if any, the amount and timing of any dividend or distribution will       
depend on the realization by the Fund of income and capital gains from          
investments. There is no fixed dividend rate and there can be no assurance that 
a Fund will pay any dividends or realize any capital gains. The final           
determination of the amount of a Fund's return of capital distributions for the 
period will be made after the end of each calendar year. Investments made       
through a 401(k) plan, 457 plan, employer sponsored 403(b) plan, profit sharing 
and money purchase plan, defined benefit plan or nonqualified deferred          
compensation plan are subject to special United States federal income tax       
rules. Therefore, the federal income tax consequences described below apply     
only to investments made other than by such plans.                              

You will normally have to pay federal income tax, and any state or local income 
taxes, on the distributions you receive from a Fund, whether you take the       
distributions in cash or reinvest them in additional shares. Distributions of   
net capital gains from the sale of investments that a Fund owned for more than  
one year and that are properly designated as capital gain dividends are taxable 
as long-term capital gains. For taxable years beginning on or before            
December 31, 2012, distributions of dividends to a Fund's non-corporate         
shareholders may be treated as "qualified dividend income," which is taxed at   
reduced rates, if such distributions are derived from, and designated by a Fund 
as, "qualified dividend income" and provided that holding period and other      
requirements are met by both the shareholder and the Fund. "Qualified dividend  
income" generally is income derived from dividends from U.S. corporations and   
"qualified foreign corporations." Other distributions by a Fund are generally   
taxable to you as ordinary income. Dividends declared in October, November, or  
December and paid in January of the following year are taxable as if they had   
been paid the previous December. A Fund will notify you as to how much of the   
Fund's distributions, if any, qualify for these reduced tax rates.              

Investment income received by a Fund from sources within foreign countries may  
be subject to foreign income taxes withheld at the source. To the extent that   
any Fund is liable for foreign income taxes withheld at the source, the Fund    
intends, if possible, to operate so as to meet the requirements of the Code to  
"pass through" to the Fund's shareholders credits for foreign income taxes paid 
(or to permit shareholders to claim a deduction for such foreign taxes), but    
there can be no assurance that any Fund will be able to do so, and Funds that   
invest primarily in U.S. securities will not do so. Furthermore, a              
shareholder's ability to claim a foreign tax credit or deduction for foreign    
taxes paid by a Fund may be subject to certain limitations imposed by the Code, 
as a result of which a shareholder may not be permitted to claim a credit or    
deduction for all or a portion of the amount of such taxes.                     

Under certain circumstances, if a Fund realizes losses (e.g., from fluctuations 
in currency exchange rates) after paying a dividend, all or a portion of the    
dividend may subsequently be characterized as a return of capital. Returns of   
capital are generally nontaxable, but will reduce a shareholder's basis in      
shares of the Fund. If that basis is reduced to zero (which could happen if the 
shareholder does not reinvest distributions and returns of capital are          
significant), any further returns of capital will be taxable as capital gain.   

If you buy shares just before a Fund deducts a distribution from its NAV, you   
will pay the full price for the shares and then receive a portion of the price  
back as a taxable distribution.                                                 

The sale or exchange of Fund shares is a taxable transaction for federal income 
tax purposes.                                                                   

Each year shortly after December 31, each Fund will send you tax information    
stating the amount and type of all its distributions for the year. You are      
encouraged to consult your tax adviser about the federal, state, and local tax  
consequences in your particular circumstances, as well as about any possible    
foreign tax consequences.                                                       

NON-U.S. SHAREHOLDERS                                                           
If you are a nonresident alien individual or a foreign corporation for federal  
income tax purposes, please see the Funds' SAI for information on how you will  
be taxed as a result of holding shares in the Funds.                            

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GENERAL INFORMATION                                                             
--------------------------------------------------------------------------------

Under unusual circumstances, a Fund may suspend redemptions or postpone payment 
for up to seven days or longer, as permitted by federal securities law. The     
Funds reserve the right to close an account that has remained below $1,000 for  
90 days.                                                                        

During drastic economic or market developments, you might have difficulty in    
reaching ABIS by telephone, in which event you should issue written             
instructions to ABIS. ABIS is not responsible for the authenticity of telephone 
requests to purchase, sell, or exchange shares. ABIS will employ reasonable     
procedures to verify that telephone requests are genuine, and could be liable   
for losses resulting from unauthorized transactions if it failed to do so.      
Dealers and agents may charge a commission for handling telephone requests. The 
telephone service may be suspended or terminated at any time without notice.    

Shareholder Services. ABIS offers a variety of shareholder services. For more   
information about these services or your account, call ABIS's toll-free number, 
800-221-5672. Some services are described in the Mutual Fund Application.       

Householding. Many shareholders of the AllianceBernstein Mutual Funds have      
family members living in the same home who also own shares of the same Funds.   
In order to reduce the amount of duplicative mail that is sent to homes with    
more than one Fund account and to reduce expenses of the Funds, all             
AllianceBernstein Mutual Funds will, until notified otherwise, send only one    
copy of each prospectus, shareholder report and proxy statement to each         
household address. This process, known as "householding," does not apply to     
account statements, confirmations, or personal tax information. If you do not   
wish to participate in householding, or wish to discontinue householding at any 
time, call ABIS at 1-800-221-5672. We will resume separate mailings for your    
account within 30 days of your request.                                         

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GLOSSARY OF INVESTMENT TERMS                                                    
--------------------------------------------------------------------------------

BONDS are interest-bearing or discounted government or corporate securities     
that obligate the issuer to pay the bond holder a specified sum of money,       
usually at specified intervals, and to repay the principal amount of the loan   
at maturity.                                                                    

FIXED-INCOME SECURITIES are investments, such as bonds, that pay a fixed rate   
of return.                                                                      

NON-U.S. COMPANY or NON-U.S. ISSUER is an entity that (i) is organized under    
the laws of a foreign country and conducts business in a foreign country,       
(ii) derives 50% or more of its total revenues from business in foreign         
countries, or (iii) issues equity or debt securities that are traded            
principally on a stock exchange in a foreign country.                           

SOVEREIGN DEBT OBLIGATIONS are foreign government debt securities, loan         
participations between foreign governments and financial institutions, and      
interests in entities organized and operated for the purpose of restructuring   
the investment characteristics of foreign government securities.                

SUPRANATIONAL ENTITIES are international organizations formed by two or more    
governments. Examples of supranational entities include the International Bank  
for Reconstruction and Development, the Inter-American Development Bank, the    
Asian Development Bank, the African Development Bank, the International Finance 
Corporation and the European Bank for Reconstruction and Development.           

U.S. GOVERNMENT SECURITIES are securities issued or guaranteed by the U.S.      
Government, its agencies or instrumentalities, including obligations that are   
issued by private issuers that are guaranteed as to principal or interest by    
the U.S. Government, its agencies or instrumentalities, or by certain           
government-sponsored entities (entities chartered by or sponsored by Act of     
Congress). These securities include securities backed by the full faith and     
credit of the United States, those supported by the right of the issuer to      
borrow from the U.S. Treasury, and those backed only by the credit of the       
issuing agency or entity itself. The first category includes U.S. Treasury      
securities (which are U.S. Treasury bills, notes, and bonds) and certificates   
issued by GNMA. U.S. Government securities not backed by the full faith and     
credit of the United States or a right to borrow from the U.S. Treasury include 
certificates issued by FNMA and FHLMC.                                          

THE BOFA MERRILL LYNCH 3-MONTH T-BILL INDEX is an unmanaged index that measures 
returns of three-month Treasury Bills.                                          

THE BARCLAYS CAPITAL U.S. AGGREGATE INDEX is a broad-based bond index comprised 
of government, corporate, mortgage and asset-backed issues, rated investment    
grade or higher, and having at least one year to maturity.                      

THE BARCLAYS CAPITAL GLOBAL AGGREGATE INDEX is a macro index of global          
government and corporate bond markets, and is composed of various indices       
calculated by Barclays Capital, including the U.S. Aggregate Index, the         
Pan-European Aggregate Index, the Global Treasury Index, the Asian-Pacific      
Aggregate Index, the Eurodollar Index and the U.S. Investment-Grade 144A Index. 

THE BARCLAYS CAPITAL HIGH YIELD INDEX is an unmanaged index generally           
representative of corporate bonds rated below investment grade.                 

THE JPMORGAN EMERGING MARKETS BOND INDEX GLOBAL is a broad-based, unmanaged     
index which tracks total return for external currency denominated debt in       
emerging markets.                                                               

THE JPMORGAN GOVERNMENT BOND INDEX-EMERGING MARKETS is a definitive local       
emerging markets debt benchmark that tracks local currency government bonds     
issued by emerging markets.                                                     

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FINANCIAL HIGHLIGHTS                                                            
--------------------------------------------------------------------------------

The financial highlights table is intended to help you understand each Fund's   
financial performance for the past five years (or, if shorter, the period of    
the Fund's operations). Certain information reflects financial results for a    
single share of a class of each Fund. The total returns in the table represent  
the rate that an investor would have earned (or lost) on an investment in the   
Fund (assuming reinvestment of all dividends and distributions). This           
information has been audited by Ernst & Young, LLP, the independent registered  
public accounting firm for all Funds, whose reports, along with each Fund's     
financial statements, are included in each Fund's Annual Report, which is       
available upon request.                                                         

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                                  INCOME FROM INVESTMENT OPERATIONS           LESS: DIVIDENDS AND DISTRIBUTIONS       
                               -----------------------------------     ---------------------------------------------- 
                                                         NET INCREASE                                                 
                     NET ASSET             NET REALIZED   (DECREASE)   DIVIDENDS    TAX   DISTRIBUTIONS               
                      VALUE,      NET     AND UNREALIZED IN NET ASSET   FROM NET  RETURN     FROM NET        TOTAL    
FISCAL YEAR OR       BEGINNING INVESTMENT GAIN (LOSS) ON  VALUE FROM   INVESTMENT   OF    REALIZED GAIN  DIVIDENDS AND
PERIOD               OF PERIOD INCOME (a)  INVESTMENTS    OPERATIONS     INCOME   CAPITAL ON INVESTMENTS DISTRIBUTIONS
----------------------------------------------------------------------------------------------------------------------
                                                                                                                      
INTERMEDIATE BOND                                                                                                     
CLASS A                                                                                                               
Year Ended 10/31/10   $10.28      $.42(c)     $  .70        $ 1.12       $(.42)    $(.00)     $0.00          $(.42)   
Year Ended 10/31/09     8.77       .44(c)       1.53          1.97        (.46)     (.00)      0.00           (.46)   
Year Ended 10/31/08    10.24       .50(c)      (1.49)         (.99)(h)    (.48)     (.00)      0.00           (.48)   
Year Ended 10/31/07    10.18       .42(c)        .06           .48        (.42)     (.00)      0.00           (.42)   
Year Ended 10/31/06    10.15       .41(c)        .04           .45        (.42)     (.00)      0.00           (.42)   

CLASS R                                                                                                               
Year Ended 10/31/10   $10.28      $.37(c)     $  .73        $ 1.10       $(.40)    $(.00)     $0.00          $(.40)   
Year Ended 10/31/09     8.77       .43(c)       1.51          1.94        (.43)     (.00)      0.00           (.43)   
Year Ended 10/31/08    10.24       .46(c)      (1.47)        (1.01)(h)    (.46)     (.00)      0.00           (.46)   
Year Ended 10/31/07    10.18       .44(c)        .02           .46        (.40)     (.00)      0.00           (.40)   
Year Ended 10/31/06    10.15       .39(c)        .04           .43        (.40)     (.00)      0.00           (.40)   

CLASS K                                                                                                               
Year Ended 10/31/10   $10.29      $.43(c)     $  .70        $ 1.13       $(.43)    $(.00)     $0.00          $(.43)   
Year Ended 10/31/09     8.78       .45(c)       1.52          1.97        (.46)     (.00)      0.00           (.46)   
Year Ended 10/31/08    10.25       .48(c)      (1.47)         (.99)(h)    (.48)     (.00)      0.00           (.48)   
Year Ended 10/31/07    10.19       .42(c)        .06           .48        (.42)     (.00)      0.00           (.42)   
Year Ended 10/31/06    10.16       .42(c)        .03           .45        (.42)     (.00)      0.00           (.42)   

CLASS I                                                                                                               
Year Ended 10/31/10   $10.29      $.49(c)     $  .68        $ 1.17       $(.46)    $(.00)     $0.00          $(.46)   
Year Ended 10/31/09     8.78       .47(c)       1.52          1.99        (.48)     (.00)      0.00           (.48)   
Year Ended 10/31/08    10.24       .50(c)      (1.45)         (.95)(h)    (.51)     (.00)      0.00           (.51)   
Year Ended 10/31/07    10.18       .45(c)        .06           .51        (.45)     (.00)      0.00           (.45)   
Year Ended 10/31/06    10.16       .44(c)        .03           .47        (.45)     (.00)      0.00           (.45)   

DIVERSIFIED YIELD                                                                                                     
CLASS A                                                                                                               
Year Ended 10/31/10   $ 8.10      $.24        $  .39        $  .63       $(.23)    $(.00)     $0.00          $(.23)   
Year Ended 10/31/09     7.39       .32           .71          1.03        (.28)     (.04)      0.00           (.32)   
Year Ended 10/31/08     9.02       .36         (1.63)        (1.27)(h)    (.36)     (.00)      0.00           (.36)   
Year Ended 10/31/07     8.62       .34           .40           .74        (.34)     (.00)      0.00           (.34)   
Year Ended 10/31/06     8.70       .34           .14           .48        (.34)     (.00)      (.22)          (.56)   

CLASS R                                                                                                               
Year Ended 10/31/10   $ 8.07      $.22        $  .39        $  .61       $(.21)    $(.00)     $0.00          $(.21)   
Year Ended 10/31/09     7.37       .30           .70          1.00        (.26)     (.04)      0.00           (.30)   
Year Ended 10/31/08     8.99       .34         (1.62)        (1.28)(h)    (.34)     (.00)      0.00           (.34)   
Year Ended 10/31/07     8.61       .35           .34           .69        (.31)     (.00)      0.00           (.31)   
Year Ended 10/31/06     8.69       .31           .14           .45        (.31)     (.00)      (.22)          (.53)   

CLASS K                                                                                                               
Year Ended 10/31/10   $ 8.10      $.23        $  .41        $  .64       $(.24)    $(.00)     $0.00          $(.24)   
Year Ended 10/31/09     7.39       .32           .71          1.03        (.28)     (.04)      0.00           (.32)   
Year Ended 10/31/08     9.00       .38         (1.63)        (1.25)(h)    (.36)     (.00)      0.00           (.36)   
Year Ended 10/31/07     8.61       .32           .40           .72        (.33)     (.00)      0.00           (.33)   
Year Ended 10/31/06     8.69       .29           .19           .48        (.34)     (.00)      (.22)          (.56)   

CLASS I                                                                                                               
Year Ended 10/31/10   $ 8.08      $.26        $  .40        $  .66       $(.26)    $(.00)     $0.00          $(.26)   
Year Ended 10/31/09     7.38       .34           .70          1.04        (.30)     (.04)      0.00           (.34)   
Year Ended 10/31/08     9.00       .38         (1.62)        (1.24)(h)    (.38)     (.00)      0.00           (.38)   
Year Ended 10/31/07     8.61       .36           .40           .76        (.37)     (.00)      0.00           (.37)   
Year Ended 10/31/06     8.69       .37           .14           .51        (.37)     (.00)      (.22)          (.59)   
----------------------------------------------------------------------------------------------------------------------

Please refer to the footnotes on pages 47 through 48.                           

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                                          RATIOS/SUPPLEMENTAL DATA                  
                         ---------------------------------------------------------- 
              TOTAL                                        RATIO OF NET             
            INVESTMENT                      RATIO OF        INVESTMENT              
NET ASSET  RETURN BASED    NET ASSETS,      EXPENSES          INCOME       PORTFOLIO
VALUE, END ON NET ASSET   END OF PERIOD    TO AVERAGE       TO AVERAGE     TURNOVER 
OF PERIOD   VALUE (b)    (000'S OMITTED)   NET ASSETS       NET ASSETS       RATE   
------------------------------------------------------------------------------------
                                                                                    
  $10.98       11.17%(d)    $418,023         .91%(e)(f)(g)     3.98%(c)(e)     99%  
   10.28       23.01(d)      419,319         .89(f)(g)         4.71(c)         95   
    8.77      (10.15)(d)     360,606         .85(f)            4.68(c)        184   
   10.24        4.79(d)       41,696         .98(f)            4.13(c)        173   
   10.18        4.51          44,409         .98(e)(f)         4.08(c)(e)     446   

  $10.98       10.94%(d)    $    759        1.08%(e)(f)(g)     3.49%(c)(e)     99%  
   10.28       22.74(d)          156        1.11(f)(g)         4.39(c)         95   
    8.77      (10.33)(d)          73        1.05(f)            4.45(c)        184   
   10.24        4.57(d)          577        1.18(f)            3.97(c)        173   
   10.18        4.31              13        1.18(e)(f)         3.89(c)(e)     446   

  $10.99       11.21%(d)    $  4,359         .86%(e)(f)(g)     4.02%(c)(e)     99%  
   10.29       23.05(d)        4,434         .84(f)(g)         4.76(c)         95   
    8.78      (10.09)(d)       3,784         .80(f)            4.69(c)        184   
   10.25        4.84(d)        7,222         .93(f)            4.39(c)        173   
   10.19        4.54              10         .93(e)(f)         4.13(c)(e)     446   

  $11.00       11.59%(d)    $  1,348         .67%(e)(f)(g)     4.60%(c)(e)     99%  
   10.29       23.36(d)        5,095         .59(f)(g)         5.02(c)         95   
    8.78       (9.78)(d)       5,115         .55(f)            4.98(c)        184   
   10.24        5.10(d)        5,368         .68(f)            4.44(c)        173   
   10.18        4.71           5,913         .68(e)(f)         4.37(c)(e)     446   

  $ 8.50        7.88%(d)    $ 42,733         .90%(e)(f)        2.83%(c)(e)     54%  
    8.10       14.45(d)       46,138         .90(f)            4.24(c)         86   
    7.39      (14.57)(d)      39,639         .90(f)            4.13(c)         81   
    9.02        8.60(d)       48,542        1.47               3.81           134   
    8.62        5.61          25,348        1.78(e)(g)         3.93(e)        169   

  $ 8.47        7.68%(d)    $    516        1.10%(e)(f)        2.61%(c)(e)     54%  
    8.07       14.12(d)          364        1.10(f)            4.02(c)         86   
    7.37      (14.65)(d)         252        1.10(f)            3.98(c)         81   
    8.99        8.15(d)          187        1.58               4.08           134   
    8.61        5.32              20        2.03(e)(g)         3.64(e)        169   

  $ 8.50        8.00%(d)    $    205         .85%(e)(f)        2.73%(c)(e)     54%  
    8.10       14.45(d)           25         .85(f)            4.29(c)         86   
    7.39      (14.28)(d)          21         .85(f)            4.02(c)         81   
    9.00        8.46(d)           57        1.59               3.47           134   
    8.61        5.61             141        1.80(e)(g)         3.63(e)        169   

  $ 8.48        8.26%(d)    $     10         .60%(e)(f)        3.13%(c)(e)     54%  
    8.08       14.69(d)            9         .60(f)            4.57(c)         86   
    7.38      (14.21)(d)           8         .60(f)            4.45(c)         81   
    9.00        8.92(d)           10        1.14               4.06           134   
    8.61        5.95              10        1.46(e)(g)         4.25(e)        169   
------------------------------------------------------------------------------------

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                                      INCOME FROM INVESTMENT OPERATIONS           LESS: DIVIDENDS AND DISTRIBUTIONS       
                                   -----------------------------------     ---------------------------------------------- 
                                                             NET INCREASE                                                 
                         NET ASSET             NET REALIZED   (DECREASE)   DIVIDENDS    TAX   DISTRIBUTIONS               
                          VALUE,      NET     AND UNREALIZED IN NET ASSET   FROM NET  RETURN     FROM NET        TOTAL    
                         BEGINNING INVESTMENT GAIN (LOSS) ON  VALUE FROM   INVESTMENT   OF    REALIZED GAIN  DIVIDENDS AND
FISCAL YEAR OR PERIOD    OF PERIOD INCOME (a)  INVESTMENTS    OPERATIONS     INCOME   CAPITAL ON INVESTMENTS DISTRIBUTIONS
--------------------------------------------------------------------------------------------------------------------------
                                                                                                                          
GLOBAL BOND                                                                                                               
CLASS A                                                                                                                   
Year Ended 9/30/10         $7.87      $.32(c)     $  .63        $  .95       $(.32)    $(.00)     $0.00          $(.32)   
Year Ended 9/30/09          7.39       .40(c)        .60          1.00        (.40)     (.00)      (.12)          (.52)   
Year Ended 9/30/08          8.07       .42(c)       (.70)         (.28)       (.40)     (.00)      0.00           (.40)   
Year Ended 9/30/07          7.54       .40           .52           .92        (.39)     (.00)      0.00           (.39)   
Year Ended 9/30/06          7.69       .44          (.15)          .29        (.44)     (.00)      0.00           (.44)   

CLASS R                                                                                                                   
Year Ended 9/30/10         $7.87      $.30(c)     $  .64        $  .94       $(.31)    $(.00)     $0.00          $(.31)   
Year Ended 9/30/09          7.39       .37(c)        .61           .98        (.38)     (.00)      (.12)          (.50)   
11/5/07(i) to 9/30/08       8.14       .35(c)       (.75)         (.40)       (.35)     (.00)      0.00           (.35)   

CLASS K                                                                                                                   
Year Ended 9/30/10         $7.87      $.32(c)     $  .64        $  .96       $(.33)    $(.00)     $0.00          $(.33)   
Year Ended 9/30/09          7.38       .40(c)        .61          1.01        (.40)     (.00)      (.12)          (.52)   
11/5/07(i) to 9/30/08       8.14       .36(c)       (.75)         (.39)       (.37)     (.00)      0.00           (.37)   

CLASS I                                                                                                                   
Year Ended 9/30/10         $7.87      $.34(c)     $  .64        $  .98       $(.35)    $(.00)     $0.00          $(.35)   
Year Ended 9/30/09          7.39       .36(c)        .66          1.02        (.42)     (.00)      (.12)          (.54)   
11/5/07(i) to 9/30/08       8.14       .47(c)       (.83)         (.36)       (.39)     (.00)      0.00           (.39)   

HIGH INCOME                                                                                                               
CLASS A                                                                                                                   
Year Ended 10/31/10        $8.24      $.69(c)     $  .96        $ 1.65(h)    $(.70)    $(.00)     $0.00          $(.70)   
Year Ended 10/31/09         5.85       .67(c)       2.44          3.11        (.69)     (.01)      (.02)          (.72)   
Year Ended 10/31/08         9.02       .61(c)      (2.87)        (2.26)(h)    (.68)     (.00)      (.23)          (.91)   
Year Ended 10/31/07         8.97       .56           .41           .97        (.57)     (.00)      (.35)          (.92)   
Year Ended 10/31/06         8.70       .55           .43           .98        (.57)     (.00)      (.14)          (.71)   

CLASS R                                                                                                                   
Year Ended 10/31/10        $8.24      $.67(c)     $  .96        $ 1.63(h)    $(.68)    $(.00)     $0.00          $(.68)   
Year Ended 10/31/09         5.85       .67(c)       2.43          3.10        (.68)     (.01)      (.02)          (.71)   
1/28/08(g) to 10/31/08      8.52       .46(c)      (2.66)        (2.20)(h)    (.47)     (.00)      0.00           (.47)   

CLASS K                                                                                                                   
Year Ended 10/31/10        $8.24      $.69(c)     $  .96        $ 1.65(h)    $(.70)    $(.00)     $0.00          $(.70)   
Year Ended 10/31/09         5.85       .68(c)       2.44          3.12        (.70)     (.01)      (.02)          (.73)   
1/28/08(i) to 10/31/08      8.52       .47(c)      (2.66)        (2.19)(h)    (.48)     (.00)      0.00           (.48)   

CLASS I                                                                                                                   
Year Ended 10/31/10        $8.25      $.71(c)     $  .97        $ 1.68(h)    $(.73)    $(.00)     $0.00          $(.73)   
Year Ended 10/31/09         5.85       .70(c)       2.44          3.14        (.71)     (.01)      (.02)          (.74)   
1/28/08(i) to 10/31/08      8.52       .49(c)      (2.67)        (2.18)(h)    (.49)     (.00)      0.00           (.49)   
--------------------------------------------------------------------------------------------------------------------------

Please refer to the footnotes on pages 47 through 48.                           

46                                                                              

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                                            RATIOS/SUPPLEMENTAL DATA                    
                         -------------------------------------------------------------- 
              TOTAL                                           RATIO OF NET              
            INVESTMENT                       RATIO OF          INVESTMENT               
NET ASSET  RETURN BASED    NET ASSETS,       EXPENSES            INCOME        PORTFOLIO
VALUE, END ON NET ASSET   END OF PERIOD     TO AVERAGE         TO AVERAGE      TURNOVER 
OF PERIOD   VALUE (b)    (000'S OMITTED)    NET ASSETS         NET ASSETS        RATE   
----------------------------------------------------------------------------------------
                                                                                        
  $8.50        12.38%      $1,744,323        .98%(e)(f)(g)       3.98%(c)(e)       69%  
   7.87        14.65        1,367,036        .93(f)(g)           5.65(c)           91   
   7.39        (3.75)       1,425,649       1.04(f)(g)           5.19(c)          140   
   8.07        12.47        1,071,398       1.80(g)              5.09             170   
   7.54         3.90          935,901       1.04(e)              5.81(e)          104   

  $8.50        12.15%      $   11,857       1.15%(e)(f)(g)       3.66%(c)(e)       69%  
   7.87        14.38            2,302       1.15(f)(g)           5.35(c)           91   
   7.39        (5.15)             122       1.24(f)(g)(j)        4.92(c)(j)       140   

  $8.50        12.46%      $    1,261        .90%(e)(f)(g)       3.88%(c)(e)       69%  
   7.87        14.88              392        .89(f)(g)           5.63(c)           91   
   7.38        (5.07)              59        .99(f)(g)(j)        5.06(c)(j)       140   

  $8.50        12.77%      $    9,931        .63%(e)             4.17%(c)(e)       69%  
   7.87        15.00            2,897        .60(f)(g)           5.88(c)           91   
   7.39        (4.72)              67        .74(f)(g)(j)        5.45(c)(j)       140   

  $9.19        20.85%(d)   $1,326,974        .99%(e)(f)(g)       7.93%(c)(e)       26%  
   8.24        57.11(d)       780,222        .99(f)(g)          10.13(c)           46   
   5.85       (27.49)(d)      450,517       1.03(e)(f)(g)        7.65(c)(e)        74   
   9.02        11.54          281,677       1.41(e)(g)           6.24(e)           67   
   8.97        11.87          235,763       1.48(g)              6.32              75   

  $9.19        20.62%(d)   $   13,250       1.18%(e)(f)(g)       7.70%(c)(e)       26%  
   8.24        56.83(d)         3,754       1.19(f)(g)           9.86(c)           46   
   5.85       (27.09)(d)        1,443       1.18(e)(f)(g)(j)     7.62(c)(e)(j)     74   

  $9.19        20.94%(d)   $    1,624        .95%(e)(f)(g)       8.04%(c)(e)       26%  
   8.24        57.24(d)         1,328        .94(f)(g)          10.18(c)           46   
   5.85       (26.94)(d)          753        .93(e)(f)(g)(j)     8.01(c)(e)(j)     74   

  $9.20        21.23%(d)   $   17,272        .67%(e)(f)(g)       8.03%(c)(e)       26%  
   8.25        57.79(d)           306        .69(f)(g)          10.45(c)           46   
   5.85       (26.84)(d)          165        .69(e)(f)(g)(j)     8.09(c)(e)(j)     74   
----------------------------------------------------------------------------------------

(a)Based on average shares outstanding.                                         

(b)Total investment return is calculated assuming an initial investment is made 
  at the NAV at the beginning of the period, reinvestment of all dividends and
  distributions at the NAV during the period, and a redemption on the last day
of the period. Initial sales charges or CDSC, if applicable, are not      
reflected in the calculation of total investment return. Total investment 
 return does not reflect the deduction of taxes that a shareholder would pay
on fund distributions or the redemption of fund shares. Total investment  
returns calculated for periods of less than one year are not annualized.  

(c)Net of fees waived and expenses reimbursed by the Adviser.                   

(d)Includes the impact of proceeds received, and credited to the Fund resulting 
 from class action settlements, which enhanced the performance of each share
class.                                                                    

                                                                            47

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                                     FOR FISCAL YEAR ENDED      
----------------------------------------------------------------
                                                                
ALLIANCEBERNSTEIN INTERMEDIATE BOND    October 31, 2010     .01%
                                       October 31, 2009     .01%
                                       October 31, 2008     .21%
                                       October 31, 2007     .61%
ALLIANCEBERNSTEIN DIVERSIFIED YIELD    October 31, 2010     .55%
                                       October 31, 2009     .57%
                                       October 31, 2008     .81%
                                       October 31, 2007    4.31%
ALLIANCEBERNSTEIN HIGH INCOME          October 31, 2010     .15%
                                       October 31, 2009     .05%
                                       October 31, 2008     .41%

(e)The ratio includes expenses attributable to costs of proxy solicitation.     

(f)Net of expenses assumed and/or waived/reimbursed. If the following Funds had 
 borne all expenses for the respective years ended, the expense ratios would
have been as follows:                                                     

                                                                [Download Table]

                                      2010  2009   2008   2007   2006 
----------------------------------------------------------------------
                                                                      
ALLIANCEBERNSTEIN INTERMEDIATE BOND                                   
Class A                              1.11%* 1.11% 1.09%   1.54% 1.34%*
Class R                              1.37%* 1.38% 1.25%   1.74% 1.57%*
Class K                              1.09%* 1.05% 1.02%   1.53% 1.27%*
Class I                               .81%*  .72%  .64%   1.09%  .88%*
ALLIANCEBERNSTEIN DIVERSIFIED YIELD                                   
Class A                              1.55%* 1.69% 1.65%               
Class R                              1.88%* 1.96% 1.88%               
Class K                              1.29%* 1.68% 1.53%               
Class I                              1.18%* 1.25% 1.28%               
ALLIANCEBERNSTEIN GLOBAL BOND                                         
Class A                              1.02%* 1.00% 1.15%               
Class R                              1.35%* 1.31% 1.48%+              
Class K                              1.06%*  .98% 1.09%+              
Class I                               .63%   .60%  .77%+              
ALLIANCEBERNSTEIN HIGH INCOME                                         
Class A                              1.04%* 1.13% 1.13%*+             
Class R                              1.37%* 1.36% 1.43%*+             
Class K                              1.08%* 1.10% 1.12%*+             
Class I                               .72%*  .72%  .79%*+             

--------                                                                        
*The ratio includes expenses attributable to costs of proxy solicitation. 
+Annualized.                                                              

(g)Includes interest expense. For the following Funds, the ratio of gross       
 expenses to average net assets, excluding interest expense (and any related
expenses), would have been as follows:                                    

                                                                [Download Table]

                                      2010  2009    2008     2007   2006 
-------------------------------------------------------------------------
                                                                         
ALLIANCEBERNSTEIN INTERMEDIATE BOND                                      
Class A                              1.05%* 1.07%                        
Class R                              1.34%* 1.33%                        
Class K                              1.03%* 1.01%                        
Class I                               .69%*  .68%                        
ALLIANCEBERNSTEIN DIVERSIFIED YIELD                                      
Class A                                                            1.72%*
Class R                                                            1.98%*
Class K                                                            1.75%*
Class I                                                            1.41%*
ALLIANCEBERNSTEIN GLOBAL BOND                                            
Class A                               .95%*  .97% 1.01%(j)  1.05%        
Class R                              1.29%* 1.27% 1.34%(j)               
Class K                              1.01%*  .93%  .95%(j)               
Class I                               .57%*  .54%  .63%(j)               
ALLIANCEBERNSTEIN HIGH INCOME                                            
Class A                              1.00%* 1.09% 1.07%*(j) 1.14%* 1.14% 
Class R                              1.34%* 1.32% 1.40%*(j)              
Class K                              1.03%* 1.06% 1.09%*(j)              
Class I                               .71%*  .68%  .75%*(j)              

--------                                                                        
*The ratio includes expenses attributable to costs of proxy solicitation. 

(h)Amount includes contribution from the Adviser of less than $.005.            

(i)Commencement of distribution.                                                

(j)Annualized.                                                                  

48                                                                              

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APPENDIX A                                                                      
--------------------------------------------------------------------------------

BOND RATINGS                                                                    
MOODY'S INVESTORS SERVICE, INC.                                                 
Aaa--Bonds which are rated Aaa are judged to be of the best quality. They carry 
the smallest degree of investment risk and are generally referred to as "gilt   
edge." Interest payments are protected by a large or by an exceptionally stable 
margin and principal is secure. While the various protective elements are       
likely to change, such changes as can be visualized are most unlikely to impair 
the fundamentally strong position of such issues.                               

Aa--Bonds which are rated Aa are judged to be of high quality by all standards. 
Together with the Aaa group they comprise what are generally known as high      
grade bonds. They are rated lower than the best bonds because margins of        
protection may not be as large as in Aaa securities or fluctuation of           
protective elements may be of greater amplitude or there may be other elements  
present which make the long-term risks appear somewhat larger than the Aaa      
securities.                                                                     

A--Bonds which are rated A possess many favorable investment attributes and are 
to be considered as upper-medium-grade obligations. Factors giving security to  
principal and interest are considered adequate but elements may be present      
which suggest a susceptibility to impairment some time in the future.           

Baa--Bonds which are rated Baa are considered as medium-grade obligations,      
i.e., they are neither highly protected nor poorly secured. Interest payments   
and principal security appear adequate for the present but certain protective   
elements may be lacking or may be characteristically unreliable over any great  
length of time. Such bonds lack outstanding investment characteristics and in   
fact have speculative characteristics as well.                                  

Ba--Bonds which are rated Ba are judged to have speculative elements; their     
future cannot be considered as well-assured. Often the protection of interest   
and principal payments may be very moderate and thereby not well safeguarded    
during both good and bad times over the future. Uncertainty of position         
characterizes bonds in this class.                                              

B--Bonds which are rated B generally lack characteristics of the desirable      
investment. Assurance of interest and principal payments or of maintenance of   
other terms of the contract over any long period of time may be small.          

Caa--Bonds which are rated Caa are of poor standing. Such issues may be in      
default or there may be present elements of danger with respect to principal or 
interest.                                                                       

Ca--Bonds which are rated Ca represent obligations which are speculative in a   
high degree. Such issues are often in default or have other marked shortcomings.

C--Bonds which are rated C are the lowest rated class of bonds and issues so    
rated can be regarded as having extremely poor prospects of ever attaining any  
real investment standing.                                                       

Absence of Rating--When no rating has been assigned or where a rating has been  
suspended or withdrawn, it may be for reasons unrelated to the quality of the   
issue.                                                                          

Should no rating be assigned, the reason may be one of the following:           

1. An application for rating was not received or accepted.                      

2. The issue or issuer belongs to a group of securities or companies that are   
unrated as a matter of policy.                                            

3. There is a lack of essential data pertaining to the issue or issuer.         

4. The issue was privately placed, in which case the rating is not published in 
Moody's publications.                                                     

Suspension or withdrawal may occur if new and material circumstances arise, the 
effects of which preclude satisfactory analysis; if there is no longer          
available reasonable up-to-date data to permit a judgment to be formed; if a    
bond is called for redemption; or for other reasons.                            

Note--Moody's applies numerical modifiers, 1, 2 and 3 in each generic rating    
classification from Aa through Caa in its corporate bond rating system. The     
modifier 1 indicates that the security ranks in the higher end of its generic   
rating category; the modifier 2 indicates a mid-range ranking; and the modifier 
3 indicates that the issue ranks in the lower end of its generic rating         
category.                                                                       

STANDARD & POOR'S RATINGS SERVICES                                              
AAA--Debt rated AAA has the highest rating assigned by S&P. Capacity to pay     
interest and repay principal is extremely strong.                               

AA--Debt rated AA has a very strong capacity to pay interest and repay          
principal and differs from the highest rated issues only in small degree.       

A--Debt rated A has a strong capacity to pay interest and repay principal       
although it is somewhat more susceptible to the adverse effects of changes in   
circumstances and economic conditions than debt in higher rated categories.     

BBB--Debt rated BBB normally exhibits adequate protection parameters. However,  
adverse economic conditions or changing circumstances are more likely to lead   
to a weakened capacity to pay interest and repay principal for debt in this     
category than in higher rated categories.                                       

BB, B, CCC, CC, C--Debt rated BB, B, CCC, CC or C is regarded as having         
significant speculative characteristics. BB indicates the lowest degree of      
speculation and C the highest. While such debt will likely have some quality    
and protective characteristics, these are outweighed by large uncertainties or  
major exposures to adverse conditions.                                          

BB--Debt rated BB is less vulnerable to nonpayment than other speculative debt. 
However, it faces major ongoing                                                 

                                                                           A-1

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uncertainties or exposure to adverse business, financial or economic conditions 
which could lead to an inadequate capacity to pay interest and repay principal. 

B--Debt rated B is more vulnerable to nonpayment than debt rated BB, but there  
is capacity to pay interest and repay principal. Adverse business, financial or 
economic conditions will likely impair the capacity or willingness to pay       
principal or repay interest.                                                    

CCC--Debt rated CCC is currently vulnerable to nonpayment, and is dependent     
upon favorable business, financial and economic conditions to pay interest and  
repay principal. In the event of adverse business, financial or economic        
conditions, there is not likely to be capacity to pay interest or repay         
principal.                                                                      

CC--Debt rated CC is currently highly vulnerable to nonpayment.                 

C--The C rating may be used to cover a situation where a bankruptcy petition    
has been filed or similar action has been taken, but payments are being         
continued.                                                                      

D--The D rating, unlike other ratings, is not prospective; rather, it is used   
only where a default has actually occurred.                                     

Plus (+) or Minus (-)--The ratings from AA to CCC may be modified by the        
addition of a plus or minus sign to show relative standing within the major     
rating categories.                                                              

NR--Not rated.                                                                  

FITCH RATINGS                                                                   
AAA--Bonds considered to be investment grade and of the highest credit quality. 
The obligor has an exceptionally strong ability to pay interest and repay       
principal, which is unlikely to be affected by reasonably foreseeable events.   

AA--Bonds considered to be investment grade and of very high credit quality.    
The obligor's ability to pay interest and repay principal is very strong,       
although not quite as strong as bonds rated AAA. Because bonds rated in the AAA 
and AA categories are not significantly vulnerable to foreseeable future        
developments, short-term debt of these issuers is generally rated F1+.          

A--Bonds considered to be investment grade and of high credit quality. The      
obligor's ability to pay interest and repay principal is considered to be       
strong, but may be more vulnerable to adverse changes in economic conditions    
and circumstances than bonds with higher ratings.                               

BBB--Bonds considered to be investment grade and of satisfactory credit         
quality. The obligor's ability to pay interest and repay principal is           
considered to be adequate. Adverse changes in economic conditions and           
circumstances, however, are more likely to have adverse impact on these bonds,  
and therefore impair timely payment. The likelihood that the ratings of these   
bonds will fall below investment grade is higher than for bonds with higher     
ratings.                                                                        

BB--Bonds are considered speculative. The obligor's ability to pay interest and 
repay principal may be affected over time by adverse economic changes. However, 
business and financial alternatives can be identified which could assist the    
obligor in satisfying its debt service requirements.                            

B--Bonds are considered highly speculative. While bonds in this class are       
currently meeting debt service requirements, the probability of continued       
timely payment of principal and interest reflects the obligor's limited margin  
of safety and the need for reasonable business and economic activity throughout 
the life of the issue.                                                          

CCC--Bonds have certain identifiable characteristics which, if not remedied,    
may lead to default. The ability to meet obligations requires an advantageous   
business and economic environment.                                              

CC--Bonds are minimally protected. Default in payment of interest and/or        
principal seems probable over time.                                             

C--Bonds are in imminent default in payment of interest or principal.           

DDD, DD, D--Bonds are in default on interest and/or principal payments. Such    
bonds are extremely speculative and should be valued on the basis of their      
ultimate recovery value in liquidation or reorganization of the obligor. DDD    
represents the highest potential for recovery on these bonds, and D represents  
the lowest potential for recovery.                                              

Plus (+) Minus (-)--Plus and minus signs are used with a rating symbol to       
indicate the relative position of a credit within the rating category. Plus and 
minus signs, however, are not used in the AAA category or in categories below B.

NR--Indicates that Fitch does not rate the specific issue.                      

DOMINION BOND RATING SERVICE LIMITED                                            
Each rating category is denoted by the subcategories "high" and "low". The      
absence of either a "high" or "low" designation indicates the rating is in the  
"middle" of the category. The AAA and D categories do not utilize "high",       
"middle", and "low" as differential grades.                                     

AAA--Long-term debt rated AAA is of the highest credit quality, with            
exceptionally strong protection for the timely repayment of principal and       
interest. Earnings are considered stable, the structure of the industry in      
which the entity operates is strong, and the outlook for future profitability   
is favorable. There are few qualifying factors present that would detract from  
the performance of the entity. The strength of liquidity and coverage ratios is 
unquestioned and the entity has established a credible track record of superior 
performance. Given the extremely high standard that Dominion has set for this   
category, few entities are able to achieve a AAA rating.                        

AA--Long-term debt rated AA is of superior credit quality, and protection of    
interest and principal is considered high. In many cases they differ from       
long-term debt rated AAA only to a small degree. Given the extremely            
restrictive definition Dominion has for the AAA category, entities rated AA are 
also considered to be strong credits, typically exemplifying above-average      
strength in key areas of consideration and unlikely to be significantly         
affected by reasonably foreseeable events.                                      

A-2                                                                             

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A--Long-term debt rated A is of satisfactory credit quality. Protection of      
interest and principal is still substantial, but the degree of strength is less 
than that of AA rated entities. While A is a respectable rating, entities in    
this category are considered to be more susceptible to adverse economic         
conditions and have greater cyclical tendencies than higher-rated securities.   

BBB--Long-term debt rated BBB is of adequate credit quality. Protection of      
interest and principal is considered acceptable, but the entity is fairly       
susceptible to adverse changes in financial and economic conditions, or there   
may be other adverse conditions present which reduce the strength of the entity 
and its rated securities.                                                       

BB--Long-term debt rated BB is defined to be speculative and non-investment     
grade, where the degree of protection afforded interest and principal is        
uncertain, particularly during periods of economic recession. Entities in the   
BB range typically have limited access to capital markets and additional        
liquidity support. In many cases, deficiencies in critical mass,                
diversification, and competitive strength are additional negative               
considerations.                                                                 

B--Long-term debt rated B is considered highly speculative and there is a       
reasonably high level of uncertainty as to the ability of the entity to pay     
interest and principal on a continuing basis in the future, especially in       
periods of economic recession or industry adversity.                            

CCC, CC and C--Long-term debt rated in any of these categories is very highly   
speculative and is in danger of default of interest and principal. The degree   
of adverse elements present is more severe than long-term debt rated B.         
Long-term debt rated below B often have features which, if not remedied, may    
lead to default. In practice, there is little difference between these three    
categories, with CC and C normally used for lower ranking debt of companies for 
which the senior debt is rated in the CCC to B range.                           

D--A security rated D implies the issuer has either not met a scheduled payment 
of interest or principal or that the issuer has made it clear that it will miss 
such a payment in the near future. In some cases, Dominion may not assign a D   
rating under a bankruptcy announcement scenario, as allowances for grace        
periods may exist in the underlying legal documentation. Once assigned, the D   
rating will continue as long as the missed payment continues to be in arrears,  
and until such time as the rating is suspended, discontinued, or reinstated by  
Dominion.                                                                       

                                                                           A-3

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APPENDIX B                                                                      
--------------------------------------------------------------------------------

HYPOTHETICAL INVESTMENT AND EXPENSE INFORMATION                                 
--------------------------------------------------------------------------------

The settlement agreement between the Adviser and the New York State Attorney    
General requires the Funds to include the following supplemental hypothetical   
investment information, which provides additional information calculated and    
presented in a manner different from expense information found under "Fees and  
Expenses of the Fund" in the Summary Information at the beginning of this       
Prospectus about the effect of a Fund's expenses, including investment advisory 
fees and other Fund costs, on each Fund's returns over a 10-year period. The    
chart shows the estimated expenses that would be charged on a hypothetical      
investment of $10,000 in Class A shares of each Fund assuming a 5% return each  
year. Except as otherwise indicated, the chart also assumes that the current    
annual expense ratio stays the same throughout the 10-year period. The current  
annual expense ratio for each Fund is the same as stated under "Financial       
Highlights." If you wish to obtain hypothetical investment information for      
other classes of shares of each Fund, please refer to the "Mutual Fund Fees &   
Expenses Calculators" on www.AllianceBernstein.com. Your actual expenses may be 
higher or lower.                                                                

ALLIANCEBERNSTEIN INTERMEDIATE BOND PORTFOLIO                                   
--------------------------------------------------------------------------------

                                                                [Download Table]

                    HYPOTHETICAL INVESTMENT              HYPOTHETICAL
       HYPOTHETICAL PERFORMANCE    AFTER    HYPOTHETICAL    ENDING   
YEAR    INVESTMENT    EARNINGS    RETURNS    EXPENSES*    INVESTMENT 
---------------------------------------------------------------------
                                                                     
1       $10,000.00   $  500.00   $10,500.00  $   93.45    $10,406.55 
2        10,406.55      520.33    10,926.88     121.29     10,805.59 
3        10,805.59      540.28    11,345.87     125.94     11,219.93 
4        11,219.93      561.00    11,780.93     130.77     11,650.16 
5        11,650.16      582.51    12,232.67     135.78     12,096.89 
6        12,096.89      604.84    12,701.73     140.99     12,560.74 
7        12,560.74      628.04    13,188.78     146.40     13,042.38 
8        13,042.38      652.12    13,694.50     152.01     13,542.49 
9        13,542.49      677.12    14,219.61     157.84     14,061.77 
10       14,061.77      703.09    14,764.86     163.89     14,600.97 
---------------------------------------------------------------------
Total                $5,969.33               $1,368.36               

ALLIANCEBERNSTEIN GLOBAL BOND FUND                                              
--------------------------------------------------------------------------------

                                                                [Download Table]

                    HYPOTHETICAL INVESTMENT              HYPOTHETICAL
       HYPOTHETICAL PERFORMANCE    AFTER    HYPOTHETICAL    ENDING   
YEAR    INVESTMENT    EARNINGS    RETURNS    EXPENSES*    INVESTMENT 
---------------------------------------------------------------------
                                                                     
1       $10,000.00   $  500.00   $10,500.00  $  102.90    $10,397.10 
2        10,397.10      519.86    10,916.96     111.35     10,805.61 
3        10,805.61      540.28    11,345.89     115.73     11,230.16 
4        11,230.16      561.51    11,791.67     120.28     11,671.39 
5        11,671.39      583.57    12,254.96     125.00     12,129.96 
6        12,129.96      606.50    12,736.46     129.91     12,606.55 
7        12,606.55      630.33    13,236.88     135.02     13,101.86 
8        13,101.86      655.09    13,756.95     140.32     13,616.63 
9        13,616.63      680.83    14,297.46     145.83     14,151.63 
10       14,151.63      707.58    14,859.21     151.56     14,707.65 
---------------------------------------------------------------------
Total                $5,985.55               $1,277.90               

ALLIANCEBERNSTEIN DIVERSIFIED YIELD FUND                                        
--------------------------------------------------------------------------------

                                                                [Download Table]

                    HYPOTHETICAL INVESTMENT              HYPOTHETICAL
       HYPOTHETICAL PERFORMANCE    AFTER    HYPOTHETICAL    ENDING   
YEAR    INVESTMENT    EARNINGS    RETURNS    EXPENSES*    INVESTMENT 
---------------------------------------------------------------------
                                                                     
1       $10,000.00   $  500.00   $10,500.00  $   94.50    $10,405.50 
2        10,405.50      520.28    10,925.78     169.35     10,756.43 
3        10,756.43      537.82    11,294.25     175.06     11,119.19 
4        11,119.19      555.96    11,675.15     180.96     11,494.19 
5        11,494.19      574.71    12,068.90     187.07     11,881.83 
6        11,881.83      594.09    12,475.92     193.38     12,282.54 
7        12,282.54      614.13    12,896.67     199.90     12,696.77 
8        12,696.77      634.84    13,331.61     206.64     13,124.97 
9        13,124.97      656.25    13,781.22     213.61     13,567.61 
10       13,567.61      678.38    14,245.99     220.81     14,025.18 
---------------------------------------------------------------------
Total                $5,866.46               $1,841.28               

B-1                                                                             

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ALLIANCEBERNSTEIN HIGH INCOME FUND                                              
--------------------------------------------------------------------------------

                                                                [Download Table]

                    HYPOTHETICAL INVESTMENT              HYPOTHETICAL
       HYPOTHETICAL PERFORMANCE    AFTER    HYPOTHETICAL    ENDING   
YEAR    INVESTMENT    EARNINGS    RETURNS    EXPENSES*    INVESTMENT 
---------------------------------------------------------------------
                                                                     
1       $10,000.00   $  500.00   $10,500.00  $  103.95    $10,396.05 
2        10,396.05      519.80    10,915.85     113.52     10,802.33 
3        10,802.33      540.12    11,342.45     117.96     11,224.49 
4        11,224.49      561.22    11,785.71     122.57     11,663.14 
5        11,663.14      583.16    12,246.30     127.36     12,118.94 
6        12,118.94      605.95    12,724.89     132.34     12,592.55 
7        12,592.55      629.63    13,222.18     137.51     13,084.67 
8        13,084.67      654.23    13,738.90     142.88     13,596.02 
9        13,596.02      679.80    14,275.82     148.47     14,127.35 
10       14,127.35      706.37    14,833.72     154.27     14,679.45 
---------------------------------------------------------------------
Total                $5,980.28               $1,300.83               

*Expenses are net of any fee waiver or expense waiver for the first year.       
Thereafter, the expense ratio reflects the Fund's operating expenses as       
reflected under "Fees and Expenses of the Fund" before waiver in the Summary  
Information at the beginning of this Prospectus.                              

                                                                           B-2

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For more information about the Funds, the following documents are available     
upon request:                                                                   

..  ANNUAL/SEMI-ANNUAL REPORTS TO SHAREHOLDERS                                  
The Funds' annual and semi-annual reports to shareholders contain additional    
information on the Funds' investments. In the annual report, you will find a    
discussion of the market conditions and investment strategies that              
significantly affected a Fund's performance during its last fiscal year.        

..  STATEMENT OF ADDITIONAL INFORMATION (SAI)                                   
The Funds have an SAI, which contains more detailed information about the       
Funds, including their operations and investment policies. The Funds' SAI and   
independent registered public accounting firm's reports and financial           
statements in each Fund's most recent annual report to shareholders are         
incorporated by reference into (and are legally part of) this Prospectus.       

You may request a free copy of the current annual/semi-annual report or the     
SAI, or make inquiries concerning the Funds, by contacting your broker or other 
financial intermediary, or by contacting the Adviser:                           

                                                                [Download Table]
                                                               
BY MAIL:          c/o AllianceBernstein Investor Services, Inc.
                  P.O. Box 786003                              
                  San Antonio, TX 78278-6003                   

BY PHONE:         For Information: (800) 221-5672              
                  For Literature: (800) 227-4618               

ON THE INTERNET:  www.AllianceBernstein.com                    

Or you may view or obtain these documents from the Securities and Exchange      
Commission (the "Commission"):                                                  

..  Call the Commission at 1-202-551-8090 for information on the operation of   
the Public Reference Room.                                                

..  Reports and other information about the Funds are available on the EDGAR    
Database on the Commission's Internet site at http://www.sec.gov.         

..  Copies of the information may be obtained, after paying a duplicating fee,  
 by electronic request at publicinfo@sec.gov, or by writing the Commission's
Public Reference Section, Wash. DC 20549-1520.                            

You also may find these documents and more information about the Adviser and    
the Funds on the Internet at: www.AllianceBernstein.com.                        

AllianceBernstein(R) and the AB logo are registered trademarks and service      
marks used by permission of the owner, AllianceBernstein L.P.                   

                                                                [Download Table]

FUND               SEC FILE NO.
-------------------------------
                               
Intermediate Bond   811-02383  
Global Bond         811-06554  
Diversified Yield   811-07391  
High Income         811-08188  

                                                            PRO-RTMT-0115-0111

 [GRAPHIC]

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[LOGO]            ALLIANCEBERNSTEIN BOND FUND, INC.                             
  -ALLIANCEBERNSTEIN INTERMEDIATE BOND PORTFOLIO
         (Class A-ABQUX; Class B-ABQBX; Class C-ABQCX; Advisor
             Class-ABQYX; Class R-ABQRX; Class K-ABQKX; Class I-ABQIX)

   ALLIANCEBERNSTEIN UNCONSTRAINED BOND FUND, INC.
         (Class A-AGSAX; Class B-AGSBX; Class C-AGCCX; Advisor
             Class-AGSIX; Class R-AGSRX; Class K-AGSKX; Class I-AGLIX)

ALLIANCEBERNSTEIN HIGH INCOME FUND, INC.    
               (Class A-AGDAX; Class B-AGDBX; Class C-AGDCX; Advisor Class
       AGDYX; Class R-AGDRX; Class K-AGDKX; Class I-AGDIX)

ALLIANCEBERNSTEIN GLOBAL BOND FUND, INC.    
               (Class A-ANAGX; Class B-ANABX; Class C-ANACX; Advisor Class
       ANAYX; Class R-ANARX; Class K-ANAKX; Class I-ANAIX)

--------------------------------------------------------------------------------

c/o AllianceBernstein Investor Services, Inc. 
P. O. Box 786003, San Antonio, Texas 78278-6003 
Toll Free: (800) 221-5672 For Literature: Toll
Free (800) 227-4618 

--------------------------------------------------------------------------------

STATEMENT OF ADDITIONAL INFORMATION 
January 31, 2011

--------------------------------------------------------------------------------

            This Statement of Additional Information ("SAI") is not a prospectus
but supplements and should be read in conjunction with the current prospectus,  
dated January 31, 2011, for the AllianceBernstein Intermediate Bond Portfolio   
("Intermediate Bond") of AllianceBernstein Bond Fund, Inc., AllianceBernstein   
Unconstrained Bond Fund, Inc. ("Unconstrained Bond"), AllianceBernstein Global  
Bond Fund, Inc. ("Global Bond") and AllianceBernstein High Income Fund, Inc.    
("High Income") (each a "Fund" and collectively, the "Funds") that offers Class 
A, Class B, Class C and Advisor Class shares of the Funds and the prospectus,   
dated January 31, 2011, of the Funds that offers Class A, Class R, Class K and  
Class I shares of the Funds (each a "Prospectus" and together, the              
"Prospectuses"). Financial statements for Intermediate Bond, Unconstrained Bond 
and High Income for the year ended October 31, 2010, and financial statements   
for Global Bond for the year ended September 30, 2010, are included in each     
Fund's annual report to shareholders and are incorporated into the SAI by       
reference. Copies of the Prospectuses and each Fund's annual report may be      
obtained by contacting AllianceBernstein Investor Services, Inc., ("ABIS") at   
the address or the "For Literature" telephone number shown above or on the      
Internet at www.AllianceBernstein.com.                                          

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TABLE OF CONTENTS 
----------------- 
                                                                            Page
                                                                            ----

INFORMATION ABOUT THE FUNDS AND THEIR INVESTMENTS............................  2
INVESTMENTS RESTRICTIONS..................................................... 44
MANAGEMENT OF THE FUNDS...................................................... 47
EXPENSES OF THE FUNDS........................................................ 82
PURCHASE OF SHARES............................................................92
REDEMPTION AND REPURCHASE OF SHARES..........................................117
SHAREHOLDER SERVICES.........................................................120
NET ASSET VALUE..............................................................124
DIVIDENDS, DISTRIBUTIONS AND TAXES...........................................127
FUND TRANSACTIONS............................................................134
GENERAL INFORMATION..........................................................138
FINANCIAL STATEMENTS AND REPORT OF INDEPENDENT REGISTERED PUBLIC                
ACCOUNTING FIRM..............................................................157

--------                                                                        
AllianceBernstein(R) and the AB Logo are registered trademarks and service marks
used by permission of the owner, AllianceBernstein L.P.                         

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--------------------------------------------------------------------------------

INFORMATION ABOUT THE FUNDS AND THEIR INVESTMENTS 

--------------------------------------------------------------------------------

Introduction to the Funds                                                       
-------------------------                                                       

        Except as otherwise noted, each Fund's investment objectives and
policies described below are not "fundamental policies" within the meaning of   
the Investment Company Act of 1940, as amended (the "1940 Act") and may,        
therefore, be changed by the Fund's Board of Directors (the "Board") without    
shareholder approval. However, no Fund will change its investment objective     
without at least 60 days' prior written notice to shareholders. There is no     
guarantee that a Fund will achieve its investment objective. Whenever any       
investment policy or restriction states a percentage of a Fund's assets that may
be invested in any security or other asset, it is intended that such percentage 
limitation be determined immediately after and as a result of a Fund's          
acquisition of such securities or other assets. Accordingly, any later increases
or decreases in percentage beyond the specified limitations resulting from a    
change in values or net assets will not be considered a violation of this       
percentage limitation.                                                          

Additional Investment Policies and Practices                                    
--------------------------------------------                                    

          The following information about the Funds' investment policies and
practices supplements the information set forth in the Prospectuses.            

Derivatives                                                                     
-----------                                                                     

    A Fund may, but is not required to, use derivatives for risk
management purposes or as part of its investment practices. Derivatives are     
financial contracts whose value depends on, or is derived from, the value of an 
underlying asset, reference rate or index. These assets, rates, and indices may 
include bonds, stocks, mortgages, commodities, interest rates, currency exchange
rates, bond indices and stock indices.                                          

    There are four principal types of derivatives, which include
options, futures, forwards and swaps. The four principal types of derivative    
instruments, as well as the methods in which they may be used by a Fund are     
described below. Derivatives may be (i) standardized, exchange-traded contracts 
or (ii) customized, privately-negotiated contracts. Exchange-traded derivatives 
tend to be more liquid and subject to less credit risk than those that are      
privately negotiated. The Funds may use derivatives to earn income and enhance  
returns, to hedge or adjust the risk profile of a portfolio and either to       
replace more traditional direct investments or to obtain exposure to otherwise  
inaccessible markets.                                                           

            Forward Contracts. A forward contract, which may be standardized and
exchange-traded or customized, and privately negotiated, is an agreement for one
party to buy, and the other party to sell, a specific quantity of an underlying 
commodity or other tangible asset for an agreed-upon price at a future date. A  
forward contract generally is settled by physical delivery of the commodity or  
other tangible asset underlying the forward contract to an agreed upon location 
at a future date (rather than settled by cash) or will be rolled forward into a 
new forward contract. Non-deliverable forwards ("NDFs") specify a cash payment  
upon maturity. NDFs are normally used when the market for physical settlement of
the currency is underdeveloped, heavily regulated or highly taxed.              

     Futures Contracts and Options on Futures Contracts. A futures
contract is an agreement that obligates the buyer to buy and the seller to sell 
a specified quantity of an underlying asset (or settle for cash the value of a  
contract based on an underlying asset, rate or index) at a specific price on the
contract maturity date. Options on futures contracts are options that call for  
the delivery of futures contracts upon exercise. Futures contracts are          
standardized, exchange-traded instruments and are fungible (i.e., considered to 
be perfect substitutes for each other). This fungibility allows futures         
contracts to be readily offset or cancelled through the acquisition of equal but
opposite positions, which is the primary method in which futures contracts are  
liquidated. A cash-settled futures contract does not require physical delivery  
of the underlying asset but instead is settled for cash equal to the difference 
between the values of the contract on the date it is entered into and its       
maturity date.                                                                  

          Options. An option, which may be standardized and exchange-traded,
or customized and privately negotiated, is an agreement that, for a premium     
payment or fee, gives the option holder (the buyer) the right but not the       
obligation to buy (a "call") or sell (a "put") the underlying asset (or settle  
for cash an amount based on an underlying asset, rate or index) at a specified  
price (the exercise price) during a period of time or on a specified date.      
Likewise, when an option is exercised the writer of the option is obligated to  
sell (in the case of a call option) or to purchase (in the case of a put option)
the underlying asset (or settle for cash an amount based on an underlying asset,
rate or index). Investments in options are considered speculative. A Fund may   
lose the premium paid for them if the price of the underlying security or other 
asset decreased or remained the same (in the case of a call option) or increased
or remained the same (in the case of a put option). If a put or call option     
purchased by the Fund were permitted to expire without being sold or exercised, 
its premium would represent a loss to the Fund.                                 

       Swaps. A swap, which may be standardized and exchange-traded or
customized, and privately negotiated, is an agreement that obligates two parties
to exchange a series of cash flows at specified intervals (payment dates) based 
upon or calculated by reference to changes in specified prices or rates         
(interest rates in the case of interest rate swaps, currency exchange rates in  
the case of currency swaps) for a specified amount of an underlying asset (the  
"notional" principal amount). Swaps are entered into on a net basis (i.e., the  
two payment streams are netted out, with the Funds receiving or paying, as the  
case may be, only the net amount of the two payments). Except for currency      
swaps, the notional principal amount is used solely to calculate the payment    
streams but is not exchanged. With respect to currency swaps, actual principal  
amounts of currencies may be exchanged by the counterparties at the initiation, 
and again upon the termination, of the transaction.                             

  Risks of Derivatives. Investment techniques employing such
derivatives involve risks different from, and, in certain cases, greater than,  
the risks presented by more traditional investments. Following is a general     
discussion of important risk factors and issues concerning the use of           
derivatives.                                                                    

             -- Market Risk. This is the general risk attendant to all
              investments that the value of a particular investment will
     change in a way detrimental to a Fund's interest.

                  -- Management Risk. Derivative products are highly specialized
           instruments that require investment techniques and risk
            analyses different from those associated with stocks and
                bonds. The use of a derivative requires an understanding not
                only of the underlying instrument but also of the derivative
               itself, without the benefit of observing the performance of
           the derivative under all possible market conditions. In
                 particular, the use and complexity of derivatives require the
                maintenance of adequate controls to monitor the transactions
                  entered into, the ability to assess the risk that a derivative
             adds to a Fund's investment portfolio, and the ability to
           forecast price, interest rate or currency exchange rate
movements correctly.                        

                 -- Credit Risk. This is the risk that a loss may be sustained
              by a Fund as a result of the failure of another party to a
                  derivative (usually referred to as a "counterparty") to comply
                  with the terms of the derivative contract. The credit risk for
          exchange-traded derivatives is generally less than for
              privately negotiated derivatives, since the clearinghouse,
               which is the issuer or counterparty to each exchange-traded
         derivative, provides a guarantee of performance. This
                  guarantee is supported by a daily payment system (i.e., margin
                  requirements) operated by the clearinghouse in order to reduce
              overall credit risk. For privately negotiated derivatives,
               there is no similar clearing agency guarantee. Therefore, a
                 Fund considers the creditworthiness of each counterparty to a
                  privately negotiated derivative in evaluating potential credit
risk.                                       

              -- Liquidity Risk. Liquidity risk exists when a particular
                instrument is difficult to purchase or sell. If a derivative
                  transaction is particularly large or if the relevant market is
           illiquid (as is the case with many privately negotiated
                  derivatives), it may not be possible to initiate a transaction
     or liquidate a position at an advantageous price.

            -- Leverage Risk. Since many derivatives have a leverage
           component, adverse changes in the value or level of the
        underlying asset, rate or index can result in a loss
         substantially greater than the amount invested in the
             derivative itself. In the case of swaps, the risk of loss
                generally is related to a notional principal amount, even if
             the parties have not made any initial investment. Certain
                 derivatives have the potential for unlimited loss, regardless
of the size of the initial investment.      

                -- Risk of Potential Governmental Regulation of Derivatives.
                  Recent legislation and regulatory developments will eventually
     require the clearing and exchange trading of most
                 over-the-counter derivatives investments. It is possible that
            new government regulation of various types of derivative
                  instruments, including futures and swap agreements, may affect
             a Fund's ability to use such instruments as a part of its
investment strategy.                        

                -- Other Risks. Other risks in using derivatives include the
               risk of mispricing or improper valuation of derivatives and
            the inability of derivatives to correlate perfectly with
              underlying assets, rates and indices. Many derivatives, in
                particular privately negotiated derivatives, are complex and
                often valued subjectively. Improper valuations can result in
              increased cash payment requirements to counterparties or a
                loss of value to a Fund. Derivatives do not always perfectly
              or even highly correlate or track the value of the assets,
        rates or indices they are designed to closely track.
                  Consequently, a Fund's use of derivatives may not always be an
                effective means of, and sometimes could be counterproductive
   to, furthering the Fund's investment objective.

Use of Options, Futures, Forwards and Swaps by a Fund                           
-----------------------------------------------------                           

          - Forward Currency Exchange Contracts. A forward currency exchange
contract is an obligation by one party to buy, and the other party to sell, a   
specific amount of a currency for an agreed upon price at a future date. A      
forward currency exchange contract may result in the delivery of the underlying 
asset upon maturity of the contract in return for the agreed upon payment. NDFs 
specify a cash payment upon maturity. NDFs are normally used when the market for
physical settlement of the currency is underdeveloped, heavily regulated or     
highly taxed.                                                                   

     A Fund may, for example, enter into forward currency exchange
contracts to attempt to minimize the risk to the Fund from adverse changes in   
the relationship between the U.S. Dollar and other currencies. A Fund may       
purchase or sell forward currency exchange contracts for hedging purposes       
similar to those described below in connection with its transactions in foreign 
currency futures contracts. A Fund may also purchase or sell forward currency   
exchange contracts for non-hedging purposes as a means of making direct         
investments in foreign currencies, as described below under "Currency           
Transactions".                                                                  

          If a hedging transaction in forward currency exchange contracts is
successful, the decline in the value of portfolio securities or the increase in 
the cost of securities to be acquired may be offset, at least in part, by       
profits on the forward currency exchange contract. Nevertheless, by entering    
into such forward currency exchange contracts, a Fund may be required to forego 
all or a portion of the benefits which otherwise could have been obtained from  
favorable movements in exchange rates.                                          

          A Fund may also use forward currency exchange contracts to seek to
increase total return when AllianceBernstein L.P., the Fund's adviser (the      
"Adviser"), anticipates that a foreign currency will appreciate or depreciate in
value but securities denominated in that currency are not held by the Fund and  
do not present attractive investment opportunities. For example, a Fund may     
enter into a foreign currency exchange contract to purchase a currency if the   
Adviser expects the currency to increase in value. The Fund would recognize a   
gain if the market value of the currency is more than the contract value of the 
currency at the time of settlement of the contract. Similarly, a Fund may enter 
into a foreign currency exchange contract to sell a currency if the Adviser     
expects the currency to decrease in value. The Fund would recognize a gain if   
the market value of the currency is less than the contract value of the currency
at the time of settlement of the contract.                                      

          The cost of engaging in forward currency exchange contracts varies
with such factors as the currencies involved, the length of the contract period 
and the market conditions then prevailing. Since transactions in foreign        
currencies are usually conducted on a principal basis, no fees or commissions   
are involved.                                                                   

           - Options on Securities. A Fund may write and purchase call and put
options on securities. In purchasing an option on securities, a Fund would be in
a position to realize a gain if, during the option period, the price of the     
underlying securities increased (in the case of a call) or decreased (in the    
case of a put) by an amount in excess of the premium paid; otherwise the Fund   
would experience a loss not greater than the premium paid for the option. Thus, 
a Fund would realize a loss if the price of the underlying security declined or 
remained the same (in the case of a call) or increased or remained the same (in 
the case of a put) or otherwise did not increase (in the case of a put) or      
decrease (in the case of a call) by more than the amount of the premium. If a   
put or call option purchased by a Fund were permitted to expire without being   
sold or exercised, its premium would represent a loss to the Fund.              

            A Fund may write a put or call option in return for a premium, which
is retained by the Fund whether or not the option is exercised. A Fund may write
covered options or uncovered options. A call option written by a Fund is        
"covered" if the Fund owns the underlying security, has an absolute and         
immediate right to acquire that security upon conversion or exchange of another 
security it holds, or holds a call option on the underlying security with an    
exercise price equal to or less than of the call option it has written. A put   
option written by a Fund is covered if the Fund holds a put option on the       
underlying securities with an exercise price equal to or greater than of the put
option it has written. Uncovered options or "naked options" are riskier than    
covered options. For example, if a Fund wrote a naked call option and the price 
of the underlying security increased, the Fund would have to purchase the       
underlying security for delivery to the call buyer and sustain a loss equal to  
the difference between the option price and the market price of the security.   

          A Fund may also, as an example, write combinations of put and call
options on the same security, known as "straddles," with the same exercise and  
expiration date. By writing a straddle, the Fund undertakes a simultaneous      
obligation to sell and purchase the same security in the event that one of the  
options is exercised. If the price of the security subsequently rises above the 
exercise price, the call will likely be exercised and the Fund will be required 
to sell the underlying security at or below market price. This loss may be      
offset, however, in whole or part, by the premiums received on the writing of   
the two options. Conversely, if the price of the security declines by a         
sufficient amount, the put will likely be exercised. The writing of straddles   
will likely be effective, therefore, only where the price of the security       
remains stable and neither the call nor the put is exercised. In those instances
where one of the options is exercised, the loss on the purchase or sale of the  
underlying security may exceed the amount of the premiums received.             

         By writing a call option, a Fund limits its opportunity to profit
from any increase in the market value of the underlying security above the      
exercise price of the option. By writing a put option, a Fund assumes the risk  
that it may be required to purchase the underlying security for an exercise     
price above its then current market value, resulting in a capital loss unless   
the security subsequently appreciates in value. Where options are written for   
hedging purposes, such transactions constitute only a partial hedge against     
declines in the value of portfolio securities or against increases in the value 
of securities to be acquired, up to the amount of the premium. A Fund may       
purchase put options to hedge against a decline in the value of portfolio       
securities. If such decline occurs, the put options will permit the Fund to sell
the securities at the exercise price or to close out the options at a profit. By
using put options in this way, the Fund will reduce any profit it might         
otherwise have realized on the underlying security by the amount of the premium 
paid for the put option and by transaction costs.                               

          A Fund may purchase or write options on securities of the types in
which it is permitted to invest in privately negotiated (i.e., over-the-counter)
transactions. A Fund will effect such transactions only with investment dealers 
and other financial institutions (such as commercial banks or savings and loan  
institutions) deemed creditworthy by the Adviser, and the Adviser has adopted   
procedures for monitoring the creditworthiness of such entities. A Fund may     
purchase or write options on securities of the types in which they are permitted
to invest in privately negotiated (i.e., over-the-counter) transactions. By     
writing a call option, the Fund limits its opportunity to profit from any       
increase in the market value of the underlying security above the exercise price
of the option. By writing a put option, the Fund assumes the risk that it may be
required to purchase the underlying security for an exercise price above its    
then current market value, resulting in a capital loss unless the security      
subsequently appreciates in value. Where options are written for hedging        
purposes, such transactions constitute only a partial hedge against declines in 
the value of portfolio securities or against increases in the value of          
securities to be acquired, up to the amount of the premium. The Fund may        
purchase put options to hedge against a decline in the value of portfolio       
securities. If such decline occurs, the put options will permit the Fund to sell
the securities at the exercise price or to close out the options at a profit. By
using put options in this way, the Fund will reduce any profit it might         
otherwise have realized on the underlying security by the amount of the premium 
paid for the put option and by transaction costs.                               

            A Fund may purchase call options to hedge against an increase in the
price of securities that the Fund anticipates purchasing in the future. If such 
increase occurs, the call option will permit the Fund to purchase the securities
at the exercise price, or to close out the options at a profit. The premium paid
for the call option plus any transaction costs will reduce the benefit, if any, 
realized by the Fund upon exercise of the option, and, unless the price of the  
underlying security rises sufficiently, the option may expire worthless to the  
Fund and the Fund will suffer a loss on the transaction to the extent of the    
premium paid.                                                                   

         A Fund will effect such transactions only with investment dealers
and other financial institutions (such as commercial banks or savings and loan  
institutions) deemed creditworthy by the Adviser, and the Adviser has adopted   
procedures for monitoring the creditworthiness of such entities. Options        
purchased or written in negotiated transactions may be illiquid and it may not  
be possible for the Fund to effect a closing transaction at a time when the     
Adviser believes it would be advantageous to do so.                             

           --Options on Securities Indices. An option on a securities index is
similar to an option on a security except that, rather than taking or making    
delivery of a security at a specified price, an option on a securities index    
gives the holder the right to receive, upon exercise of the option, an amount of
cash if the closing level of the chosen index is greater than (in the case of a 
call) or less than (in the case of a put) the exercise price of the option.     

          A Fund may write (sell) call and put options and purchase call and
put options on securities indices. If a Fund purchases put options on securities
indices to hedge its investments against a decline in the value of portfolio    
securities, it will seek to offset a decline in the value of securities it owns 
through appreciation of the put option. If the value of the Fund's investments  
does not decline as anticipated, or if the value of the option does not         
increase, the Fund's loss will be limited to the premium paid for the option.   
The success of this strategy will largely depend on the accuracy of the         
correlation between the changes in value of the index and the changes in value  
of the Fund's security holdings.                                                

           The purchase of call options on securities indices may be used by a
Fund to attempt to reduce the risk of missing a broad market advance, or an     
advance in an industry or market segment, at a time when the Fund holds         
uninvested cash or short-term debt securities awaiting investment. When         
purchasing call options for this purpose, the Fund will also bear the risk of   
losing all or a portion of the premium paid if the value of the index does not  
rise. The purchase of call options on stock indices when a Fund is substantially
fully invested is a form of leverage, up to the amount of the premium and       
related transaction costs, and involves risks of loss and of increased          
volatility similar to those involved in purchasing call options on securities   
the Fund owns.                                                                  

      --Options on Foreign Currencies. A Fund may purchase and write
options on foreign currencies for hedging purposes. For example, a decline in   
the dollar value of a foreign currency in which portfolio securities are        
denominated will reduce the dollar value of such securities, even if their value
in the foreign currency remains constant. In order to protect against such      
diminutions in the value of portfolio securities, the Fund may purchase put     
options on the foreign currency. If the value of the currency does decline, the 
Fund will have the right to sell such currency for a fixed amount in dollars and
could thereby offset, in whole or in part, the adverse effect on its portfolio  
which otherwise would have resulted.                                            

           Conversely, where a rise in the dollar value of a currency in which
securities to be acquired are denominated is projected, thereby increasing the  
cost of such securities, a Fund may purchase call options thereon. The purchase 
of such options could offset, at least partially, the effects of the adverse    
movements in exchange rates. As in the case of other types of options, however, 
the benefit to the Fund from purchases of foreign currency options will be      
reduced by the amount of the premium and related transaction costs. In addition,
where currency exchange rates do not move in the direction or to the extent     
anticipated, the Fund could sustain losses on transactions in foreign currency  
options which would require it to forego a portion or all of the benefits of    
advantageous changes in such rates.                                             

           A Fund may write options on foreign currencies for hedging purposes
or to increase return. For example, where a Fund anticipates a decline in the   
dollar value of foreign-denominated securities due to adverse fluctuations in   
exchange rates it could, instead of purchasing a put option, write a call option
on the relevant currency. If the expected decline occurs, the option will most  
likely not be exercised, and the diminution in value of portfolio securities    
could be offset by the amount of the premium received.                          

          Similarly, instead of purchasing a call option to hedge against an
anticipated increase in the dollar cost of securities to be acquired, a Fund    
could write a put option on the relevant currency, which, if rates move in the  
manner projected, will expire unexercised and allow the Fund to hedge such      
increased cost up to the amount of the premium. As in the case of other types of
options, however, the writing of a foreign currency option will constitute only 
a partial hedge up to the amount of the premium, and only if rates move in the  
expected direction. If this does not occur, the option may be exercised and the 
Fund will be required to purchase or sell the underlying currency at a loss     
which may not be offset by the amount of the premium. Through the writing of    
options on foreign currencies, the Fund also may be required to forego all or a 
portion of the benefits that might otherwise have been obtained from favorable  
movements in exchange rates.                                                    

       In addition to using options for the hedging purposes described
above, a Fund may also invest in options on foreign currencies for non-hedging  
purposes as a means of making direct investments in foreign currencies. A Fund  
may use options on currency to seek to increase total return when the Adviser   
anticipates that a foreign currency will appreciate or depreciate in value but  
securities denominated in that currency are not held by the Fund and do not     
present attractive investment opportunities. For example, the Fund may purchase 
call options in anticipation of an increase in the market value of a currency. A
Fund would ordinarily realize a gain if, during the option period, the value of 
such currency exceeded the sum of the exercise price, the premium paid and      
transaction costs. Otherwise, the Fund would realize no gain or a loss on the   
purchase of the call option. Put options may be purchased by a Fund for the     
purpose of benefiting from a decline in the value of a currency that the Fund   
does not own. A Fund would normally realize a gain if, during the option period,
the value of the underlying currency decreased below the exercise price         
sufficiently to more than cover the premium and transaction costs. Otherwise,   
the Fund would realize no gain or loss on the purchase of the put option. For   
additional information on the use of options on foreign currencies for          
non-hedging purposes, see "Currency Transactions" below.                        

Special Risks Associated with Options on Currency. An   
exchange-traded options position may be closed out only on an options exchange  
that provides a secondary market for an option of the same series. Although a   
Fund will generally purchase or sell options for which there appears to be an   
active secondary market, there is no assurance that a liquid secondary market on
an exchange will exist for any particular option, or at any particular time. For
some options, no secondary market on an exchange may exist. In such event, it   
might not be possible to effect closing transactions in particular options, with
the result that the Fund would have to exercise its options in order to realize 
any profit and would incur transaction costs on the sale of the underlying      
currency.                                                                       

     --Futures Contracts and Options on Futures Contracts. Futures
contracts that a Fund may buy and sell may include futures contracts on         
fixed-income or other securities, and contracts based on interest rates, foreign
currencies or financial indices, including any index of U.S. Government         
securities. A Fund may, for example, purchase or sell futures contracts and     
options thereon to hedge against changes in interest rates, securities (through 
index futures or options) or currencies.                                        

         Interest rate futures contracts are purchased or sold for hedging
purposes to attempt to protect against the effects of interest rate changes on a
Fund's current or intended investments in fixed-income securities. For example, 
if a Fund owned long-term bonds and interest rates were expected to increase,   
that Fund might sell interest rate futures contracts. Such a sale would have    
much the same effect as selling some of the long-term bonds in that Fund's      
portfolio. However, since the futures market is more liquid than the cash       
market, the use of interest rate futures contracts as a hedging technique allows
a Fund to hedge its interest rate risk without having to sell its portfolio     
securities. If interest rates were to increase, the value of the debt securities
in the portfolio would decline, but the value of that Fund's interest rate      
futures contracts would be expected to increase at approximately the same rate, 
thereby keeping the net asset value ("NAV") of that Fund from declining as much 
as it otherwise would have. On the other hand, if interest rates were expected  
to decline, interest rate futures contracts could be purchased to hedge in      
anticipation of subsequent purchases of long-term bonds at higher prices.       
Because the fluctuations in the value of the interest rate futures contracts    
should be similar to those of long-term bonds, a Fund could protect itself      
against the effects of the anticipated rise in the value of long-term bonds     
without actually buying them until the necessary cash becomes available or the  
market has stabilized. At that time, the interest rate futures contracts could  
be liquidated and that Fund's cash reserves could then be used to buy long-term 
bonds on the cash market.                                                       

           A Fund may purchase and sell foreign currency futures contracts for
hedging purposes in order to protect against fluctuations in currency exchange  
rates. Such fluctuations could reduce the dollar value of portfolio securities  
denominated in foreign currencies, or increase the cost of foreign-denominated  
securities to be acquired, even if the value of such securities in the          
currencies in which they are denominated remains constant. A Fund may sell      
futures contracts on a foreign currency, for example, when it holds securities  
denominated in such currency and it anticipates a decline in the value of such  
currency relative to the dollar. If such a decline were to occur, the resulting 
adverse effect on the value of foreign-denominated securities may be offset, in 
whole or in part, by gains on the futures contracts. However, if the value of   
the foreign currency increases relative to the dollar, a Fund's loss on the     
foreign currency futures contract may or may not be offset by an increase in the
value of the securities because a decline in the price of the security stated in
terms of the foreign currency may be greater than the increase in value as a    
result of the change in exchange rates.                                         

          Conversely, a Fund could protect against a rise in the dollar cost
of non-U.S. Dollar-denominated securities to be acquired by purchasing futures  
contracts on the relevant currency, which could offset, in whole or in part, the
increased cost of such securities resulting from a rise in the dollar value of  
the underlying currencies. When a Fund purchases futures contracts under such   
circumstances, however, and the price in dollars of securities to be acquired   
instead declines as a result of appreciation of the dollar, the Fund will       
sustain losses on its futures position which could reduce or eliminate the      
benefits of the reduced cost of portfolio securities to be acquired.            

       A Fund may also engage in currency "cross hedging" when, in the
opinion of the Adviser, the historical relationship among foreign currencies    
suggests that a Fund may achieve protection against fluctuations in currency    
exchange rates similar to that described above at a reduced cost through the use
of a futures contract relating to a currency other than the U.S. Dollar or the  
currency in which the foreign security is denominated. Such "cross hedging" is  
subject to the same risks as those described above with respect to an           
unanticipated increase or decline in the value of the subject currency relative 
to the U.S. Dollar.                                                             

          A Fund may also use foreign currency futures contracts and options
on such contracts for non-hedging purposes. Similar to options on currencies    
described above, a Fund may use foreign currency futures contracts and options  
on such contracts to seek to increase total return when the Adviser anticipates 
that a foreign currency will appreciate or depreciate in value but securities   
denominated in that currency are not held by the Fund and do not present        
attractive investment opportunities. The risks associated with foreign currency 
futures contracts and options on futures are similar to those associated with   
options on foreign currencies, as described above. For additional information on
the use of options on foreign currencies for non-hedging purposes, see "Currency
Transactions" below.                                                            

          Purchases or sales of stock or bond index futures contracts may be
used for hedging purposes to attempt to protect a Fund's current or intended    
investments from broad fluctuations in stock or bond prices. For example, a Fund
may sell stock or bond index futures contracts in anticipation of or during a   
market decline to attempt to offset the decrease in market value of the Fund's  
portfolio securities that might otherwise result. If such decline occurs, the   
loss in value of portfolio securities may be offset, in whole or part, by gains 
on the futures position. When a Fund is not fully invested in the securities    
market and anticipates a significant market advance, it may purchase stock or   
bond index futures contracts in order to gain rapid market exposure that may, in
whole or in part, offset increases in the cost of securities that the Fund      
intends to purchase. As such purchases are made, the corresponding positions in 
stock or bond index futures contracts will be closed out.                       

          Each Fund has claimed an exclusion from the definition of the term
"commodity pool operator" under the Commodity Exchange Act and therefore is not 
subject to registration or regulation as a pool operator under that Act.        

           Options on futures contracts are options that call for the delivery
of futures contracts upon exercise. Options on futures contracts written or     
purchased by a Fund will be traded on U.S. exchanges.                           

        The writing of a call option on a futures contract constitutes a
partial hedge against declining prices of the securities in a Fund's portfolio. 
If the futures price at expiration of the option is below the exercise price, a 
Fund will retain the full amount of the option premium, which provides a partial
hedge against any decline that may have occurred in the Fund's portfolio        
holdings. The writing of a put option on a futures contract constitutes a       
partial hedge against increasing prices of the securities or other instruments  
required to be delivered under the terms of the futures contract. If the futures
price at expiration of the put option is higher than the exercise price, a Fund 
will retain the full amount of the option premium, which provides a partial     
hedge against any increase in the price of securities which the Fund intends to 
purchase. If a put or call option a Fund has written is exercised, the Fund will
incur a loss which will be reduced by the amount of the premium it receives.    
Depending on the degree of correlation between changes in the value of its      
portfolio securities and changes in the value of its options on futures         
positions, a Fund's losses from exercised options on futures may to some extent 
be reduced or increased by changes in the value of portfolio securities.        

    A Fund may purchase options on futures contracts for hedging
purposes instead of purchasing or selling the underlying futures contracts. For 
example, where a decrease in the value of portfolio securities is anticipated as
a result of a projected market-wide decline or changes in interest or exchange  
rates, a Fund could, in lieu of selling futures contracts, purchase put options 
thereon. In the event that such decrease were to occur, it may be offset, in    
whole or part, by a profit on the option. If the anticipated market decline were
not to occur, the Fund will suffer a loss equal to the price of the put. Where  
it is projected that the value of securities to be acquired by a Fund will      
increase prior to acquisition due to a market advance or changes in interest or 
exchange rates, a Fund could purchase call options on futures contracts, rather 
than purchasing the underlying futures contracts. If the market advances, the   
increased cost of securities to be purchased may be offset by a profit on the   
call. However, if the market declines, the Fund will suffer a loss equal to the 
price of the call, but the securities that the Fund intends to purchase may be  
less expensive.                                                                 

         - Credit Default Swap Agreements. The "buyer" in a credit default
swap contract is obligated to pay the "seller" a periodic stream of payments    
over the term of the contract in return for a contingent payment upon the       
occurrence of a credit event with respect to an underlying reference obligation.
Generally, a credit event means bankruptcy, failure to pay, obligation          
acceleration or modified restructuring. A Fund may be either the buyer or seller
in the transaction. As a seller, the Fund receives a fixed rate of income       
throughout the term of the contract, which typically is between one month and   
five years, provided that no credit event occurs. If a credit event occurs, the 
Fund typically must pay the contingent payment to the buyer, which is typically 
the "par value" (full notional value) of the reference obligation. The          
contingent payment may be a cash settlement or by physical delivery of the      
reference obligation in return for payment of the face amount of the obligation.
The value of the reference obligation received by the Fund as a seller if a     
credit event occurs, coupled with the periodic payments previously received, may
be less than the full notional value it pays to the buyer, resulting in a loss  
of value to the Fund. If the Fund is a buyer and no credit event occurs, the    
Fund will lose its periodic stream of payments over the term of the contract.   
However, if a credit event occurs, the buyer typically receives full notional   
value for a reference obligation that may have little or no value.              

         Credit default swaps may involve greater risks than if a Fund had
invested in the reference obligation directly. Credit default swaps are subject 
to general market risk, liquidity risk and credit risk.                         

          - Currency Swaps. A Fund may enter into currency swaps for hedging
purposes in an attempt to protect against adverse changes in exchange rates     
between the U.S. Dollar and other currencies or for non-hedging purposes as a   
means of making direct investments in foreign currencies, as described below    
under "Currency Transactions". Currency swaps involve the exchange by the Fund  
with another party of a series of payments in specified currencies. Actual      
principal amounts of currencies may be exchanged by the counterparties at the   
initiation and again upon termination of the transaction. Since currency swaps  
are individually negotiated, the Fund expects to achieve an acceptable degree of
correlation between its portfolio investments and its currency swaps positions. 
Therefore the entire principal value of a currency swap is subject to the risk  
that the other party to the swap will default on its contractual delivery       
obligations. With respect to Intermediate Bond, the Fund will not enter into any
currency swap unless the credit quality of the unsecured senior debt or the     
claims-paying ability of the other party thereto is rated in the highest rating 
category of at least one nationally recognized statistical rating organization  
at the time of entering into the transaction. If there is a default by the other
party to such a transaction, a Fund will have contractual remedies pursuant to  
the agreements related to the transactions.                                     

           --Swaps: Interest Rate Transactions. A Fund may enter into interest
rate swap, swaptions and cap or floor transactions, which may include preserving
a return or spread on a particular investment or portion of its portfolio or    
protecting against an increase in the price of securities the Fund anticipates  
purchasing at a later date. Unless there is a counterparty default, the risk of 
loss to a Fund from interest rate transactions is limited to the net amount of  
interest payments that the Fund is contractually obligated to make. If the      
counterparty to an interest rate transaction defaults, the Fund's risk of loss  
consists of the net amount of interest payments that the Fund is contractually  
entitled to receive.                                                            

       Interest rate swaps involve the exchange by a Fund with another
party of payments calculated by reference to specified interest rates (e.g., an 
exchange of floating rate payments for fixed rate payments) computed based on a 
contractually-based principal (or "notional") amount.                           

      An option on a swap agreement, also called a "swaption," is an
option that gives the buyer the right, but not the obligation, to enter into a  
swap on a future date in exchange for paying a market-based "premium." A        
receiver swaption gives the owner the right to receive the total return of a    
specified asset, reference rate, or index. A payer swaption gives the owner the 
right to pay the total return of a specified asset, reference rate, or index.   
Swaptions also include options that allow an existing swap to be terminated or  
extended by one of the counterparties.                                          

        Interest rate caps and floors are similar to options in that the
purchase of an interest rate cap or floor entitles the purchaser, to the extent 
that a specified index exceeds (in the case of a cap) or falls below (in the    
case of a floor) a predetermined interest rate, to receive payments of interest 
on a notional amount from the party selling the interest rate cap or floor.     

         Caps and floors are less liquid than swaps. These transactions do
not involve the delivery of securities or other underlying assets or principal. 
A Fund will enter into interest rate swap, swaptions, cap or floor transactions 
only with counterparties who have credit ratings of at least A- (or the         
equivalent) from any one NRSRO or counterparties with guarantors with debt      
securities having such a rating.                                                

           - Inflation (CPI) Swaps. Inflation swap agreements are contracts in
which one party agrees to pay the cumulative percentage increase in a price     
index (the Consumer Price Index with respect to CPI swaps) over the term of the 
swap (with some lag on the inflation index), and the other pays a compounded    
fixed rate. Inflation swap agreements may be used to protect the NAV of the Fund
against an unexpected change in the rate of inflation measured by an inflation  
index since the value of these agreements is expected to increase if unexpected 
inflation increases.                                                            

         - Total Return Swaps. A Fund may enter into total return swaps in
order to take a "long" or "short" position with respect to an underlying        
referenced asset. The Fund is subject to market price volatility of the         
underlying referenced asset. A total return swap involves commitments to pay    
interest in exchange for a market linked return based on a notional amount. To  
the extent that the total return of the security group of securities or index   
underlying the transaction exceeds or falls short of the offsetting interest    
obligation, the Fund will receive a payment from or make a payment to the       
counterparty.                                                                   

           Special Risks Associated with Swaps. Risks may arise as a result of
the failure of the counterparty to the swap contract to comply with the terms of
the swap contract. The loss incurred by the failure of a counterparty is        
generally limited to the net interim payment to be received by a Fund, and/or   
the termination value at the end of the contract. Therefore, the Fund considers 
the creditworthiness of each counterparty to a swap contract in evaluating      
potential counterparty risk. The risk is mitigated by having a netting          
arrangement between the Fund and the counterparty and by the posting of         
collateral by the counterparty to the Fund to cover the Fund's exposure to the  
counterparty. Additionally, risks may arise from unanticipated movements in     
interest rates or in the value of the underlying securities. The Fund accrues   
for the interim payments on swap contracts on a daily basis, with the net amount
recorded within unrealized appreciation/depreciation of swap contracts on the   
statement of assets and liabilities. Once the interim payments are settled in   
cash, the net amount is recorded as realized gain/(loss) on swaps on the        
statement of operations, in addition to any realized gain/(loss) recorded upon  
the termination of swap contracts. Fluctuations in the value of swap contracts  
are recorded as a component of net change in unrealized                         
appreciation/depreciation of swap contracts on the statement of operations.     

        - Eurodollar Instruments. Eurodollar instruments are essentially
U.S. Dollar-denominated futures contracts or options thereon that are linked to 
the London Interbank Offered Rate and are subject to the same limitations and   
risks as other futures contracts and options.                                   

- Currency Transactions. A Fund may invest in non-U.S.  
Dollar-denominated securities on a currency hedged or un-hedged basis. The      
Adviser will actively manage the Fund's currency exposures and may seek         
investment opportunities by taking long or short positions in currencies through
the use of currency-related derivatives, including forward currency exchange    
contracts, futures and options on futures, swaps and options. The Adviser may   
enter into transactions for investment opportunities when it anticipates that a 
foreign currency will appreciate or depreciate in value but securities          
denominated in that currency are not held by the Fund and do not present        
attractive investment opportunities. Such transactions may also be used when the
Adviser believes that it may be more efficient than a direct investment in a    
foreign currency-denominated security. The Funds may also conduct currency      
exchange contracts on a spot basis (i.e., for cash at the spot rate prevailing  
in the currency exchange market for buying or selling currencies).              

Forward Commitments and When-Issued and Delayed Delivery Securities             
-------------------------------------------------------------------             

      Forward commitments for the purchase or sale of securities may
include purchases on a "when-issued" basis or purchases or sales on a "delayed  
delivery" basis. In some cases, a forward commitment may be conditioned upon the
occurrence of a subsequent event, such as approval and consummation of a merger,
corporate reorganization or debt restructuring (i.e., a "when, as and if issued"
trade). When forward commitment transactions are negotiated, the price is fixed 
at the time the commitment is made. The Fund assumes the rights and risks of    
ownership of the security, but does not pay for the securities until they are   
received. If a Fund is fully or almost fully invested when forward commitment   
purchases are outstanding, such purchases may result in a form of leverage.     
Leveraging the portfolio in this manner may increase the Fund's volatility of   
returns.                                                                        

           When-issued securities and forward commitments may be sold prior to
the settlement date. If the Fund chooses to dispose of the right to acquire a   
when-issued security prior to its acquisition or dispose of its right to deliver
or receive against a forward commitment, it may incur a gain or loss. Any       
significant commitment of Fund assets to the purchase of securities on a "when, 
as and if issued" basis may increase the volatility of the Fund's NAV.          

        The use of forward commitments enables a Fund to protect against
anticipated changes in exchange rates, interest rates and/or prices. For        
instance, a Fund may enter into a forward contract when it enters into a        
contract for the purchase or sale of a security denominated in a foreign        
currency in order to "lock in" the U.S. Dollar price of the security            
("transaction hedge"). In addition, when a Fund believes that a foreign currency
may suffer a substantial decline against the U.S. Dollar, it may enter into a   
forward sale contract to sell an amount of that foreign currency approximating  
the value of some or all of that Fund's securities denominated in such foreign  
currency, or when the Fund believes that the U.S. Dollar may suffer a           
substantial decline against a foreign currency, it may enter into a forward     
purchase contract to buy that foreign currency for a fixed dollar amount        
("position hedge"). If the Adviser were to forecast incorrectly the direction of
exchange rate movements, a Fund might be required to complete such when-issued  
or forward transactions at prices inferior to the then current market values.   

Forward commitments include "To be announced" ("TBA")   
mortgage-backed securities, which are contracts for the purchase or sale of     
mortgage-backed securities to be delivered at a future agreed-upon date, whereby
the specific mortgage pool number or the number of pools that will be delivered 
to fulfill the trade obligation or terms of the contract are unknown at the time
of the trade. Subsequent to the time of the trade, a mortgage pool or pools     
guaranteed by the Government National Mortgage Association, or GNMA, the Federal
National Mortgage Association, or FNMA, or the Federal Home Loan Mortgage       
Association, or FHLMC (including fixed rate or variable rate mortgages) are     
allocated to the TBA mortgage-backed securities transactions.                   

         At the time a Fund intends to enter into a forward commitment, it
will record the transaction and thereafter reflect the value of the security    
purchased or, if a sale, the proceeds to be received, in determining its NAV.   
Any unrealized appreciation or depreciation reflected in such valuation of a    
"when, as and if issued" security would be canceled in the event that the       
required conditions did not occur and the trade was canceled.                   

            Purchases of securities on a forward commitment or when-issued basis
may involve more risk than other types of purchases. For example, by committing 
to purchase securities in the future, a Fund subjects itself to a risk of loss  
on such commitments as well as on its portfolio securities. Also, a Fund may    
have to sell assets which have been set aside in order to meet redemptions. In  
addition, if a Fund determines it is advisable as a matter of investment        
strategy to sell the forward commitment or "when-issued" or "delayed delivery"  
securities before delivery, that Fund may incur a gain or loss because of market
fluctuations since the time the commitment to purchase such securities was made.
Any such gain or loss would be treated as a capital gain or loss for tax        
purposes. When the time comes to pay for the securities to be purchased under a 
forward commitment or on a "when-issued" or "delayed delivery" basis, the Fund  
will meet its obligations from the then available cash flow or the sale of      
securities, or, although it would not normally expect to do so, from the sale of
the forward commitment or "when-issued" or "delayed delivery" securities        
themselves (which may have a value greater or less than the Fund's payment      
obligation). No interest or dividends accrue to the purchaser prior to the      
settlement date for securities purchased or sold under a forward commitment. In 
addition, in the event the other party to the transaction files for bankruptcy, 
becomes insolvent, or defaults on its obligation, a Fund may be adversely       
affected.                                                                       

Illiquid Securities                                                             
-------------------                                                             

          A Fund will not invest in illiquid securities if immediately after
such investment more than 15% or such other amount permitted by guidance        
regarding the 1940 Act of the Fund's net assets would be invested in such       
securities. For this purpose, illiquid securities include, among others, (a)    
direct placements or other securities which are subject to legal or contractual 
restrictions on resale or for which there is no readily available market (e.g., 
trading in the security is suspended or, in the case of unlisted securities,    
market makers do not exist or will not entertain bids or offers), (b) options   
purchased by the Fund over-the-counter and the cover for options written by the 
Fund over-the-counter, and (c) repurchase agreements not terminable within seven
days. Securities that have legal or contractual restrictions on resale but have 
a readily available market are not deemed illiquid for purposes of this         
limitation.                                                                     

  Mutual funds do not typically hold a significant amount of
restricted securities (securities that are subject to restrictions on resale to 
the general public) or other illiquid securities because of the potential for   
delays on resale and uncertainty in valuation. Limitations on resale may have an
adverse effect on the marketability of portfolio securities and a mutual fund   
might be unable to dispose of restricted or other illiquid securities promptly  
or at reasonable prices and might thereby experience difficulty satisfying      
redemptions within seven days. A mutual fund may also have to take certain steps
or wait a certain amount of time in order to remove the transfer restrictions   
for such restricted securities in order to dispose of them, resulting in        
additional expense and delay.                                                   

   Rule 144A under the Securities Act of 1933, as amended (the
"Securities Act") allows a broader institutional trading market for securities  
otherwise subject to restriction on resale to the general public. Rule 144A     
establishes a "safe harbor" from the registration requirements of the Securities
Act for resales of certain securities to qualified institutional buyers. An     
insufficient number of qualified institutional buyers interested in purchasing  
certain restricted securities held by a Fund, however, could affect adversely   
the marketability of such portfolio securities and the Fund might be unable to  
dispose of such securities promptly or at reasonable prices.                    

          The Adviser, acting under the oversight of the Board, will monitor
the liquidity of restricted securities in a Fund that are eligible for resale   
pursuant to Rule 144A. In reaching liquidity decisions, the Adviser will        
consider, among others, the following factors: (1) the frequency of trades and  
quotes for the security; (2) the number of dealers issuing quotations to        
purchase or sell the security; (3) the number of other potential purchasers of  
the security; (4) the number of dealers undertaking to make a market in the     
security; (5) the nature of the security (including its unregistered nature) and
the nature of the marketplace for the security (e.g., the time needed to dispose
of the security, the method of soliciting offers and the mechanics of the       
transfer); and (6) any applicable Securities and Exchange Commission            
("Commission") interpretation or position with respect to such type of          
securities.                                                                     

Investments in Other Investment Companies                                       
-----------------------------------------                                       

            A Fund may invest in securities of other investment companies to the
extent permitted under the 1940 Act or the rules and regulations thereunder (as 
such statute, rules or regulations may be amended from time to time) or by      
guidance regarding, interpretations of, or exemptive orders under, the 1940 Act 
or the rules or regulations thereunder published by appropriate regulatory      
authorities. The Funds intend to invest uninvested cash balances in an          
affiliated money market fund as permitted by Rule 12d1-1 under the 1940 Act. If 
the Fund acquires shares in investment companies, shareholders would bear,      
indirectly, the expenses of such investment companies (which may include        
management and advisory fees), which are in addition to the Fund's expenses. A  
Fund may also invest in exchange-traded funds, subject to the restrictions and  
limitations of the 1940 Act.                                                    

Lending of Portfolio Securities                                                 
-------------------------------                                                 

           A Fund may seek to increase income by lending portfolio securities.
A principal risk in lending portfolio securities, as with other extensions of   
credit, consists of the possible loss of rights in the collateral should the    
borrower fail financially. In addition, a Fund may be exposed to the risk that  
the sale of any collateral realized upon the borrower's default will not yield  
proceeds sufficient to replace the loaned securities. In determining whether to 
lend securities to a particular borrower, the Adviser (subject to oversight by  
the Fund's Directors) will consider all relevant facts and circumstances,       
including the creditworthiness of the borrower. The loans would be made only to 
firms deemed by the Adviser to be of good standing, and when, in the judgment of
the Adviser, the consideration that can be earned currently from securities     
loans of this type justifies the attendant risk. A Fund may lend portfolio      
securities to the extent permitted under the 1940 Act or the rules and          
regulations thereunder (as such statute, rules or regulations may be amended    
from time to time) or by guidance regarding, interpretations of, or exemptive   
orders under, the 1940 Act.                                                     

          Under present regulatory policies, including those of the Board of
Governors of the Federal Reserve System and the Commission, such loans may be   
made only to member firms of the New York Stock Exchange (the "Exchange") and   
will be required to be secured continuously by collateral in cash, cash         
equivalents, or U.S. Treasury Bills maintained on a current basis at an amount  
at least equal to the market value of the securities loaned. A Fund will have   
the right to call a loan and obtain the securities loaned at any time on five   
days' notice. While securities are on loan, the borrower will pay the Fund any  
income from the securities. A Fund may invest any cash collateral in portfolio  
securities and earn additional income or receive an agreed-upon amount of income
from a borrower who has delivered equivalent collateral. Any such investment of 
cash collateral will be subject to the Fund's investment risks.                 

           A Fund will not have the right to vote any securities having voting
rights during the existence of the loan. A Fund will have the right to regain   
record ownership of loaned securities or equivalent securities in order to      
exercise ownership rights such as voting rights, subscription rights and rights 
to dividends, interest, or distributions.                                       

         A Fund may pay reasonable finders', administrative, and custodial
fees in connection with a loan.                                                 

Loan Participations and Assignments                                             
-----------------------------------                                             

            A Fund may invest in fixed or floating rate corporate loans ("Loans"
and each, a "Loan") either by participating as co-lender at the time the loan is
originated ("Participations") or by buying an interest in the loan in the       
secondary market from a financial institution or institutional investor         
("Assignments"). These loans may include "bridge loans", which are loans taken  
out for a short period (typically less than six months) pending arrangement of  
more permanent financing through, for example, the issuance of bonds, frequently
high-yield bonds issued for the purposes of acquisitions. The financial status  
of an institution interposed between a Fund and a borrower may affect the       
ability of the Fund to receive principal and interest payments.                 

         The success of a Fund may depend on the skill with which an agent
bank administers the terms of the corporate loan agreements, monitors borrower  
compliance with covenants, collects principal, interest and fee payments from   
borrowers and, where necessary, enforces creditor remedies against borrowers.   
Agent banks typically have broad discretion in enforcing loan agreements.       

          A Fund's investment in Participations typically will result in the
Fund having a contractual relationship only with the financial institution      
arranging the Loan with the borrower (the "Lender") and not with the borrower   
directly. A Fund will have the right to receive payments of principal, interest 
and any fees to which it is entitled only from the Lender selling the           
Participation and only upon receipt by the Lender of the payments from the      
borrower. In connection with purchasing Participations, the Fund generally will 
have no right to enforce compliance by the borrower with the terms of the loan  
agreement relating to the Loan, nor any rights of set-off against the borrower, 
and the Fund may not directly benefit from any collateral supporting the Loan in
which it has purchased the Participation. As a result, the Fund may be subject  
to the credit risk of both the borrower and the Lender that is selling the      
Participation. In the event of the insolvency of the Lender selling a           
Participation, the Fund may be treated as a general creditor of the Lender and  
may not benefit from any set-off between the Lender and the borrower. Certain   
Participations may be structured in a manner designed to avoid purchasers of    
Participations being subject to the credit risk of the Lender with respect to   
the Participation; but even under such a structure, in the event of the Lender's
insolvency, the Lender's servicing of the Participation may be delayed and the  
assignability of the Participation impaired. A Fund will acquire Participations 
only if the Lender interpositioned between the Fund and the borrower is a Lender
having total assets of more than $25 billion and whose senior unsecured debt is 
rated investment grade or higher.                                               

      When a Fund purchases Assignments from Lenders it will acquire
direct rights against the borrower on the Loan. Because Assignments are arranged
through private negotiations between potential assignees and potential          
assignors, however, the rights and obligations acquired by the Fund as the      
purchaser of an assignment may differ from, and be more limited than, those held
by the assigning Lender. The assignability of certain obligations is restricted 
by the governing documentation as to the nature of the assignee such that the   
only way in which the Fund may acquire an interest in a Loan is through a       
Participation and not an Assignment. A Fund may have difficulty disposing of    
Assignments and Participations because to do so it will have to assign such     
securities to a third party. Because there is no liquid market for such         
securities, the Fund anticipates that such securities could be sold only to a   
limited number of institutional investors. The lack of a liquid secondary market
may have an adverse impact on the value of such securities and the Fund's       
ability to dispose of particular Assignments or Participations when necessary to
meet the Fund's liquidity needs in response to a specific economic event such as
a deterioration in the creditworthiness of the borrower. The lack of a liquid   
secondary market for Assignments and Participations also may make it more       
difficult for the Fund to assign a value to these securities for purposes of    
valuing the Fund's portfolio and calculating its asset value.                   

Mortgage-Related Securities and Other Asset-Backed Securities                   
-------------------------------------------------------------                   

            The mortgage-related securities in which a Fund may invest typically
are securities representing interests in pools of mortgage loans made by lenders
such as savings and loan associations, mortgage bankers and commercial banks and
are assembled for sale to investors (such as the Funds) by governmental,        
government-related or private organizations. Private organizations include      
commercial banks, savings associations, mortgage companies, investment banking  
firms, finance companies, special purpose finance entities (called special      
purpose vehicles or SPVs) and other entities that acquire and package loans for 
resales as mortgage-related securities. Specifically, these securities may      
include pass-through mortgage-related securities, collateralized mortgage       
obligations ("CMOs"), CMO residuals, adjustable-rate mortgage securities        
("ARMS"), stripped mortgage-backed securities ("SMBSs"), commercial             
mortgage-backed securities, TBA mortgage-backed securities, mortgage dollar     
rolls, collateralized obligations and other securities that directly or         
indirectly represent a participation in or are secured by and payable from      
mortgage loans on real property and other assets.                               

       Pass-Through Mortgage-Related Securities. Interests in pools of
mortgage-related securities differ from other forms of debt securities, which   
normally provide for periodic payment of interest in fixed amounts with         
principal payments at maturity or specified call dates. Instead, these          
securities provide a monthly payment consisting of both interest and principal  
payments. In effect, these payments are a "pass-through" of the monthly payments
made by the individual borrowers on their residential mortgage loans, net of any
fees paid to the issuer or guarantor of such securities. Additional payments are
caused by repayments of principal resulting from the sale of the underlying     
residential property, refinancing or foreclosure, net of fees or costs that may 
be incurred. Some mortgage-related securities, such as securities issued by     
GNMA, are described as "modified pass-through." These securities entitle the    
holder to receive all interest and principal payments owed on the mortgage pool,
net of certain fees, regardless of whether or not the mortgagor actually makes  
the payment.                                                                    

            The average life of pass-through pools varies with the maturities of
the underlying mortgage instruments. In addition, a pool's term may be shortened
by unscheduled or early payments of principal and interest on the underlying    
mortgages. The occurrence of mortgage prepayments is affected by factors        
including the level of interest rates, general economic conditions, the location
and age of the mortgage and other social and demographic conditions. As         
prepayment rates of individual pools vary widely, it is not possible to         
accurately predict the average life of a particular pool. For pools of          
fixed-rate 30-year mortgages, common industry practice is to assume that        
prepayments will result in a 12-year average life. Pools of mortgages with other
maturities or different characteristics will have varying average life          
assumptions. The assumed average life of pools of mortgages having terms of less
than 30 years, is less than 12 years, but typically not less than 5 years.      

            Yields on pass-through securities are typically quoted by investment
dealers and vendors based on the maturity of the underlying instruments and the 
associated average life assumption. In periods of falling interest rates, the   
rate of prepayment tends to increase, thereby shortening the actual average life
of a pool of mortgage-related securities. Conversely, in periods of rising      
interest rates the rate of prepayment tends to decrease, thereby lengthening the
actual average life of the pool. Historically, actual average life has been     
consistent with the 12-year assumption referred to above. Actual prepayment     
experience may cause the yield to differ from the assumed average life yield.   
Reinvestment of prepayments may occur at higher or lower interest rates than the
original investment, thus affecting the yield of the Fund. The compounding      
effect from reinvestment of monthly payments received by the Fund will increase 
the yield to shareholders compared with bonds that pay interest semi-annually.  

      The principal governmental (i.e., backed by the full faith and
credit of the U.S. Government) guarantor of mortgage-related securities is GNMA.
GNMA is a wholly-owned U.S. Government corporation within the Department of     
Housing and Urban Development. GNMA is authorized to guarantee, with the full   
faith and credit of the U.S. Government, the timely payment of principal and    
interest on securities issued by institutions approved by GNMA (such as savings 
and loan institutions, commercial banks and mortgage bankers) and backed by     
pools of FHA-insured or VA-guaranteed mortgages.                                

            Government-related (i.e., not backed by the full faith and credit of
the U.S. Government) guarantors include FNMA and FHLMC. FNMA and FHLMC are a    
government-sponsored corporation or corporate instrumentality of the U.S.       
Government respectively (government-sponsored entities or "GSEs"), which were   
owned entirely by private stockholders until 2008 when they were placed in      
conservatorship by the U.S. Government. After being placed in conservatorship,  
the GSEs issued senior preferred stock and common stock to the U.S. Treasury in 
an amount equal to 79.9% of each GSE in return for certain funding and liquidity
arrangements. The GSEs continue to operate as going concerns while in           
conservatorship and each remains liable for all of its obligations associated   
with its mortgage-backed securities. The U.S. Treasury has provided additional  
funding to the GSEs and their future is unclear as Congress is considering      
whether to adopt legislation that would severely restrict or even terminate     
their operations. FNMA purchases residential mortgages from a list of approved  
seller/servicers which include state and federally-chartered savings and loan   
associations, mutual savings banks, commercial banks and credit unions and      
mortgage bankers. Pass-through securities issued by FNMA are guaranteed as to   
timely payment of principal and interest by FNMA and are now, in effect, backed 
by the full faith and credit of the U.S. Government. Participation certificates 
issued by FHLMC, which represent interests in mortgages from FHLMC's national   
portfolio, are guaranteed by FHLMC as to the timely payment of interest and     
ultimate collection of principal and are now, in effect, backed by the full     
faith and credit of the U.S. Government.                                        

         Commercial banks, savings and loan associations, private mortgage
insurance companies, mortgage bankers and other secondary market issuers create 
pass-through pools of conventional residential mortgage loans. Securities       
representing interests in pools created by non-governmental private issuers     
generally offer a higher rate of interest than securities representing interests
in pools created by governmental issuers because there are no direct or indirect
governmental guarantees of the underlying mortgage payments. However, private   
issuers sometimes obtain committed loan facilities, lines of credit, letters of 
credit, surety bonds or other forms of liquidity and credit enhancement to      
support the timely payment of interest and principal with respect to their      
securities if the borrowers on the underlying mortgages fail to make their      
mortgage payments. The ratings of such non-governmental securities are generally
dependent upon the ratings of the providers of such liquidity and credit support
and would be adversely affected if the rating of such an enhancer were          
downgraded.                                                                     

        The structuring of the pass-through pool may also provide credit
enhancement. Examples of such credit support arising out of the structure of the
transaction include the issue of senior and subordinated securities (e.g., the  
issuance of securities by a SPV in multiple classes or "tranches", with one or  
more classes being senior to other subordinated classes as to payment of        
principal and interest, with the result that defaults on the underlying mortgage
loans are borne first by the holders of the subordinated class); creation of    
"reserve funds" ( in which case cash or investments sometimes funded from a     
portion of the payments on the underlying mortgage loans, are held in reserve   
against future losses); and "overcollateralization" (in which case the scheduled
payments on, or the principal amount of, the underlying mortgage loans exceeds  
that required to make payment of the securities and pay any servicing or other  
fees). There can be no guarantee the credit enhancements, if any will be        
sufficient to prevent losses in the event of defaults on the underlying mortgage
loans.                                                                          

           In addition, mortgage-related securities that are issued by private
issuers are not subject to the underwriting requirements for the underlying     
mortgages that are applicable to those mortgage-related securities that have a  
government or government-sponsored entity guaranteed. As a result, the mortgage 
loans underlying private mortgage-related securities may, and frequently do,    
have less favorable collateral, credit risk or other underwriting               
characteristics than government or government-sponsored mortgage-related        
securities and have wider variances in a number of terms, including interest    
rate, term, size, purposes and borrower characteristics. Privately issued pools 
more frequently include second mortgages, high loan-to-value mortgages and      
manufactured housing loans. The coupon rates and maturities of the underlying   
mortgage loans in a private-label mortgage-related pool may vary to a greater   
extent than those included in a government guaranteed pool, and the pool may    
include subprime mortgage loans. Subprime loans refer to loans made to borrowers
with weakened credit histories or with a lower capacity to make timely payments 
on their loans. For these reasons, the loans underlying these securities have   
had in many cases higher default rates than those loans that meet government    
underwriting requirements.                                                      

Collateralized Mortgage Obligations. Another form of    
mortgage-related security is a "pay-through" security, which is a debt          
obligation of the issuer secured by a pool of mortgage loans pledged as         
collateral that is legally required to be paid by the issuer, regardless of     
whether payments are actually made on the underlying mortgages. CMOs are the    
predominant type of "pay-through" mortgage-related security. In a CMO, a series 
of bonds or certificates is issued in multiple classes. Each class of a CMO,    
often referred to as a "tranche," is issued at a specific coupon rate and has a 
stated maturity or final distribution date. Principal prepayments on collateral 
underlying a CMO may cause one or more tranches of the CMO to be retired        
substantially earlier than the stated maturities or final distribution dates of 
the collateral. Although payment of the principal of, and interest on, the      
underlying collateral securing privately issued CMOs may be guaranteed by GNMA, 
FNMA or FHLMC, these CMOs represent obligations solely of the private issuer and
are not insured or guaranteed by GNMA, FNMA, FHLMC, any other governmental      
agency or any other person or entity.                                           

Adjustable-Rate Mortgage Securities. Another type of    
mortgage-related security, known as adjustable-rate mortgage securities         
("ARMS"), bears interest at a rate determined by reference to a predetermined   
interest rate or index. ARMS may be secured by fixed-rate mortgages or          
adjustable-rate mortgages. ARMS secured by fixed-rate mortgages generally have  
lifetime caps on the coupon rates of the securities. To the extent that general 
interest rates increase faster than the interest rates on the ARMS, these ARMS  
will decline in value. The adjustable-rate mortgages that secure ARMS will      
frequently have caps that limit the maximum amount by which the interest rate or
the monthly principal and interest payments on the mortgages may increase. These
payment caps can result in negative amortization (i.e., an increase in the      
balance of the mortgage loan). Furthermore, since many adjustable-rate mortgages
only reset on an annual basis, the values of ARMS tend to fluctuate to the      
extent that changes in prevailing interest rates are not immediately reflected  
in the interest rates payable on the underlying adjustable-rate mortgages.      

       Stripped Mortgage-Related Securities. Stripped mortgage-related
securities (SMRS) are mortgage related securities that are usually structured   
with separate classes of securities collateralized by a pool of mortgages or a  
pool of mortgage backed bonds or pass-through securities, with each class       
receiving different proportions of the principal and interest payments from the 
underlying assets. A common type of SMRS has one class of interest-only         
securities (IOs) receiving all of the interest payments from the underlying     
assets and one class of principal-only securities (POs) receiving all of the    
principal payments from the underlying assets. IOs and POs are extremely        
sensitive to interest rate changes and are more volatile than mortgage-related  
securities that are not stripped. IOs tend to decrease in value as interest     
rates decrease and are extremely sensitive to the rate of principal payments    
(including prepayments) on the related underlying mortgage assets, and a rapid  
rate of principal prepayments may have a material adverse effect on the yield to
maturity of the IO class. POs generally increase in value as interest rates     
decrease. If prepayments of the underlying mortgages are greater than           
anticipated, the amount of interest earned on the overall pool will decrease due
to the decreasing principal balance of the assets. Due to their structure and   
underlying cash flows, SMRS may be more volatile than mortgage-related          
securities that are not stripped. Changes in the values of IOs and POs can be   
substantial and occur quickly, such as occurred in the first half of 1994 when  
the value of many POs dropped precipitously due to increases in interest rates. 

   A Fund will only invest in SMRS that are issued by the U.S.
Government, its agencies or instrumentalities and supported by the full faith   
and credit of the U.S. Although SMRS are purchased and sold by institutional    
investors through several investment banking firms acting as brokers or dealers,
the complexity of these instruments and the smaller number of investors in the  
sector can lend to illiquid markets in the sector.                              

         Commercial Mortgage-Backed Securities. Commercial mortgage-backed
securities are securities that represent an interest in, or are secured by,     
mortgage loans secured by multifamily or commercial properties, such as         
industrial and warehouse properties, office buildings, retail space and shopping
malls, and cooperative apartments, hotels and motels, nursing homes, hospitals  
and senior living centers. Commercial mortgage-backed securities have been      
issued in public and private transactions by a variety of public and private    
issuers using a variety of structures, some of which were developed in the      
residential mortgage context, including multi-class structures featuring senior 
and subordinated classes. Commercial mortgage-backed securities may pay fixed or
floating-rates of interest. The commercial mortgage loans that underlie         
commercial mortgage-related securities have certain distinct risk               
characteristics. Commercial mortgage loans generally lack standardized terms,   
which may complicate their structure, tend to have shorter maturities than      
residential mortgage loans and may not be fully amortizing. Commercial          
properties themselves tend to be unique and are more difficult to value than    
single-family residential properties. In addition, commercial properties,       
particularly industrial and warehouse properties, are subject to environmental  
risks and the burdens and costs of compliance with environmental laws and       
regulations.                                                                    

          "To Be Announced" Mortgaged-Backed Securities. TBA mortgage-backed
securities are described in "Derivatives--Forward Commitments and When-Issued   
and Delayed Delivery Securities" above.                                         

           Certain Risks. The value of mortgage-related securities is affected
by a number of factors. Unlike traditional debt securities, which have fixed    
maturity dates, mortgage-related securities may be paid earlier than expected as
a result of prepayments of underlying mortgages. Such prepayments generally     
occur during periods of falling mortgage interest rates. If property owners make
unscheduled prepayments of their mortgage loans, these prepayments will result  
in the early payment of the applicable mortgage-related securities. In that     
event, the Fund may be unable to invest the proceeds from the early payment of  
the mortgage-related securities in investments that provide as high a yield as  
the mortgage-related securities. Early payments associated with mortgage-related
securities cause these securities to experience significantly greater price and 
yield volatility than is experienced by traditional fixed-income securities. The
level of general interest rates, general economic conditions and other social   
and demographic factors affect the occurrence of mortgage prepayments. During   
periods of falling interest rates, the rate of mortgage prepayments tends to    
increase, thereby tending to decrease the life of mortgage-related securities.  
Conversely, during periods of rising interest rates, a reduction in prepayments 
may increase the effective life of mortgage-related securities, subjecting them 
to greater risk of decline in market value in response to rising interest rates.
If the life of a mortgage-related security is inaccurately predicted, the Fund  
may not be able to realize the rate of return it expected.                      

        As with other fixed-income securities, there is also the risk of
nonpayment of mortgage-related securities, particularly for those securities    
that are backed by mortgage pools that contain subprime loans. Market factors   
adversely affecting mortgage loan repayments include a general economic         
downturn, high unemployment, a general slowdown in the real estate market, a    
drop in the market prices of real estate, or higher mortgage payments required  
to be made by holders of adjustable rate mortgages due to scheduled increases or
increases due to higher interest rates.                                         

           Subordinated mortgage-related securities may have additional risks.
The subordinated mortgage-related security may serve as credit support for the  
senior securities purchased by other investors. In addition, the payments of    
principal and interest on these subordinated securities generally will be made  
only after payments are made to the holders of securities senior to the         
subordinated securities. Therefore, if there are defaults on the underlying     
mortgage loans, the holders of subordinated mortgage-related securities will be 
less likely to receive payments of principal and interest and will be more      
likely to suffer a loss.                                                        

     Commercial mortgage-related securities, like all fixed-income
securities, generally decline in value as interest rates rise. Moreover,        
although generally the value of fixed-income securities increases during periods
of falling interest rates, this inverse relationship is not as marked in the    
case of single-family residential mortgage-related securities, due to the       
increased likelihood of prepayments during periods of falling interest rates,   
and may not be as marked in the case of commercial mortgage-related securities. 
The process used to rate commercial mortgage-related securities may focus on,   
among other factors, the structure of the security, the quality and adequacy of 
collateral and insurance, and the creditworthiness of the originators, servicing
companies and providers of credit support.                                      

       Although the market for mortgage-related securities is becoming
increasingly liquid, those issued by certain private organizations may not be   
readily marketable there may be a limited market for these securities,          
especially when there is a perceived weakness in the mortgage and real estate   
market sectors. In particular, the secondary markets for CMOs, IOs and POs may  
be more volatile and less liquid than those for other mortgage-related          
securities, thereby potentially limiting a Fund's ability to buy or sell those  
securities at any particular time. Without an active trading market,            
mortgage-related securities held in a Fund's portfolio may be particularly      
difficult to value because of the complexities involved in the value of the     
underlying mortgages. In addition, the rating agencies may have difficulties in 
rating commercial mortgage-related securities through different economic cycles 
and in monitoring such ratings on a longer-term basis.                          

As with fixed-income securities generally, the value of 
mortgage-related securities can also be adversely affected by increases in      
general interest rates relative to the yield provided by such securities. Such  
an adverse effect is especially possible with fixed-rate mortgage securities. If
the yield available on other investments rises above the yield of the fixed-rate
mortgage securities as a result of general increases in interest rate levels,   
the value of the mortgage-related securities will decline.                      

 Other Asset-Backed Securities. A Fund may invest in other
asset-backed securities. The securitization techniques used to develop          
mortgage-related securities are being applied to a broad range of financial     
assets. Through the use of trusts and special purpose corporations, various     
types of assets, including automobile loans and leases, credit card receivables,
home equity loans, equipment leases and trade receivables, are being securitized
in structures similar to the structures used in mortgage securitizations. For   
example, the Fund may invest in collateralized debt obligations ("CDOs"), which 
include collateralized bond obligations ("CBOs"), collateralized loan           
obligations ("CLOs"), and other similarly structured securities. CBOs and CLOs  
are types of asset-backed securities. A CBO is a trust, which is backed by a    
diversified pool of high-risk, below investment grade fixed-income securities. A
CLO is a trust typically collateralized by a pool of loans, which may include,  
among others, domestic and foreign senior secured loans, senior unsecured loans,
and subordinate corporate loans, including loans that may be rated below        
investment grade or equivalent unrated loans. These asset-backed securities are 
subject to risks associated with changes in interest rates, prepayment of       
underlying obligations and defaults similar to the risks of investment in       
mortgage-related securities discussed above.                                    

    Each type of asset-backed security also entails unique risks
depending on the type of assets involved and the legal structure used. For      
example, credit card receivables are generally unsecured obligations of the     
credit card holder and the debtors are entitled to the protection of a number of
state and federal consumer credit laws, many of which give such debtors the     
right to set off certain amounts owed on the credit cards, thereby reducing the 
balance due. There have also been proposals to cap the interest rate that a     
credit card issuer may charge. In some transactions, the value of the           
asset-backed security is dependent on the performance of a third party acting as
credit enhancer or servicer. Furthermore, in some transactions (such as those   
involving the securitization of vehicle loans or leases) it may be              
administratively burdensome to perfect the interest of the security issuer in   
the underlying collateral and the underlying collateral may become damaged or   
stolen.                                                                         

Participation in the TALF Program                                               
---------------------------------                                               

          A Fund may invest a portion of its assets through participation in
the Term Asset-Backed Securities Loan Facility program ("TALF Program"), a      
program created by the Board of Governors of the Federal Reserve System (the    
"Federal Reserve") and the U.S. Department of the Treasury to assist the        
securitization markets by supporting the issuance of certain eligible           
collateral, which are investment-grade rated, asset-backed securities such as   
automobile loans, student loans, and credit card loans, as well as receivables  
related to residential mortgage servicing advances or certain commercial        
mortgage-backed securities. The types of eligible collateral may be expanded by 
the Federal Reserve in the future, and among other requirements must at issuance
be rated in the highest investment-grade rating category by at least two ratings
agencies (without he benefit of a third-party guarantee), and must not be placed
on a watch list or downgraded by any such rating agency. The TALF Program is    
operated by the Federal Reserve Bank of New York (the "New York Fed"). Under the
TALF Program, the New York Fed provides non-recourse loans to a Fund in a       
minimum size of $10 million.                                                    

            In order to obtain a loan under the TALF Program, a Fund is required
to put up a certain percentage of the purchase price or value of the eligible   
collateral (called the "haircut"). In addition, it is required to pay an        
administrative fee to the New York Fed on the settlement date of each TALF      
Program loan received by the Fund. The interest rate under the loan will vary   
and will be determined under the terms of the TALF Program. The term of a loan  
under the TALF Program depends on the nature of the eligible collateral and are 
currently three years or five years.                                            

           In connection with a TALF Program loan, a Fund will pledge eligible
collateral, which will consist of either certain eligible asset-backed          
securities that the Fund currently owns or other asset-backed securities that   
the Fund purchases with the loan proceeds. Except in limited circumstances, TALF
loans by the New York Fed to the Fund are non-recourse, and if the Fund does not
repay the loan, the New York Fed may enforce its rights only against the        
eligible collateral pledged by the Fund and not against any other assets of the 
Fund. TALF loans are prepayable at the option of the Fund without penalty, and  
the Fund may satisfy its loan obligation in full at any time by surrendering the
eligible collateral to the New York Fed. If the securities constituting eligible
collateral default and lose all their value, under the current terms of the TALF
Program the New York Fed cannot look to the Fund to cover the principal on the  
loan. Generally, under the terms of the TALF Program payment of principal on    
eligible collateral must be used immediately to reduce the principal amount of  
the TALF loan in proportion to the haircut (for example, if the original haircut
was 10%, 90% of any principal repaid must be immediately paid to the New York   
Fed).                                                                           

           The risk of leverage to the Fund under the TALF Program is the same
risk of leverage that applies to other types of borrowings the Fund may engage  
in (see "Effects of Borrowing and Use of Leverage" below for more details).     
Loans under the TALF Program would not be subject to the Funds' limitations on  
borrowings (which are generally limited to 33 1/3% of the Fund's total assets). 
However, the Fund will borrow under the TALF Program only if it maintains       
segregated liquid assets (in addition to any assets pledged as eligible         
collateral), marked-to-market daily, in an amount equal to the Fund's           
outstanding principal and interest under the TALF loan, treating the loans under
the TALF Program similar to other financial instruments (such as reverse        
repurchase agreements) that obligate a fund to "cover:" its obligation to       
purchase or deliver cash or securities at a future time.                        

            Participations in the TALF Program and other loan programs sponsored
by the United States of America (and any of its subdivisions, agencies,         
departments, commissions, boards, authorities, instrumentalities or bureaus)    
will not be considered purchasing securities on margin for purposes of the      
Fund's limits on margin.                                                        

       The New York Fed reserves the right to reject any request for a
loan, in whole or in part, in its sole discretion, even if a Fund meets all     
requirements of the TALF Program. The Federal Reserve may also change the terms 
of the TALF Program at its discretion. While the current terms of the TALF      
Program state that amendments will only apply to future participations, there is
no guarantee that retroactive changes to the TALF Program will not occur. The   
Fund cannot predict the form any such changes or modifications might take and,  
if the Fund participates in the TALF Program, such changes may adversely affect 
the value of the Fund's assets and the ability of the Fund to achieve its       
investment objectives. Any changes to the TALF Program may, among other things, 
further limit or expand the types of securities that may be purchased with the  
proceeds of a TALF Program loan.                                                

            Participation in the TALF Program requires the Fund to contract with
a primary dealer that will be authorized to act as agent for the Fund. A primary
dealer may receive direct or indirect fees for its services. Any such fees      
incurred will be borne by the Fund. Under the terms of the TALF Program, any    
interest and principal payments from TALF eligible collateral will be directed  
first to a custodial account in the name of the primary dealer prior to         
remittance to the Fund. As a result, the Fund will be subject to the            
counterparty risk of the primary dealer. Any voting rights held in respect of   
TALF eligible collateral under a TALF Program loan currently are subject to the 
consent of the New York Fed, whose consent must be obtained via the primary     
dealer, which may delay the Fund's voting ability.                              

            Under certain circumstances, loans under the TALF Program may become
recourse to the Fund, which may adversely affect the Fund's ability to achieve  
its investment objective. In connection with any borrowing by the Fund under the
TALF Program, a Fund is required to represent, among other things, that at the  
time of borrowing the Fund is an eligible borrower and that the collateral is   
eligible collateral. A determination that the Fund is, at any time, not an      
eligible borrower (based on the criteria that is applicable at the time of      
borrowing), or a determination that certain representations made by the Fund    
under the TALF Program were untrue when made , will cause the loan to become    
full recourse to the Fund, and the Fund must then repay the loan or surrender   
the eligible collateral at a time when it may not be advantageous to do so,     
which may result in losses to the Fund. Additionally, the loan may become       
recourse to the Fund if certain persons acquire more than 25% of the Fund's     
outstanding securities or if the Fund fails to make certain timely filings under
the TALF Program. If loans under the TALF Program become recourse against the   
Fund and the value of the eligible collateral pledged to the New York Fed does  
not at least equal the amount of principal and interest the Fund owes to the New
York Fed under the loan, then the Fund will be required to pay the difference to
the New York Fed. In order to make this payment, the Fund may be required to    
sell portfolio securities during adverse market conditions or at other times it 
would not otherwise choose to sell such securities. Finally, if the Fund were to
surrender its eligible collateral under the terms of the TALF Program, it would 
lose the amount of the haircut.                                                 

          Under the terms of its agreement with the Fund, the primary dealer
generally disclaims all liability for losses that may occur in connection with  
the TALF Program, the risk of which is borne by the Fund. Further, the Fund     
indemnifies for any losses that the primary dealer may incur under the terms of 
the TALF Program. The primary dealer may terminate its agreement with the Fund  
at any time. If the Fund is not able to find a replacement primary dealer within
the requisite period of time, it may be required to either repay the loan, sell 
the eligible collateral, or surrender the eligible collateral at a time when it 
may not be advantageous to do so, which may result in losses to the Fund.       
Agreements with the primary dealer are subject to amendment by the primary      
dealer without the Fund's consent, in order to conform to any future amendments 
of the TALF Program by the Federal Reserve.                                     

         Participation in TALF will not subject the Fund or the Manager to
restrictions on executive compensation under the Treasury Department's Troubled 
Assets Relief Program.                                                          

Preferred Stock                                                                 
---------------                                                                 

          A Fund may invest in preferred stock. Preferred stock is an equity
security that has features of debt because it generally entitles the holder to  
periodic payments at a fixed rate of return. Preferred stock is subordinated to 
any debt the issuer has outstanding but has liquidation preference over common  
stock. Accordingly, preferred stock dividends are not paid until all debt       
obligations are first met. Preferred stock may be subject to more fluctuations  
in market value, due to changes in market participants' perceptions of the      
issuer's ability to continue to pay dividends, than debt of the same issuer.    

Repurchase Agreements and Buy/Sell Back Transactions                            
----------------------------------------------------                            

          A repurchase agreement is an agreement by which a Fund purchases a
security and obtains a simultaneous commitment from the seller to repurchase the
security at an agreed upon price and date, normally one day or a week later. The
purchase and repurchase obligations are transacted under one document. The      
resale price is greater than the purchase price, reflecting an agreed-upon      
"interest rate" that is effective for the period of time the buyer's money is   
invested in the security, and which is related to the current market rate of the
purchased security rather than its coupon rate. During the term of a repurchase 
agreement, the Fund monitors on a daily basis the market value of the securities
subject to the agreement and, if the market value of the securities falls below 
the resale amount provided under the repurchase agreement, the seller under the 
repurchase agreement is required to provide additional securities or cash equal 
to the amount by which the market value of the securities falls below the resale
amount. Because a repurchase agreement permits a Fund to invest temporarily     
available cash on a fully-collateralized basis, repurchase agreements permit the
Fund to earn a return on temporarily available cash while retaining "overnight" 
flexibility in pursuit of investments of a longer-term nature. Repurchase       
agreements may exhibit the characteristics of loans by a Fund.                  

          The obligation of the seller under the repurchase agreement is not
guaranteed, and there is a risk that the seller may fail to repurchase the      
underlying security, whether because of the seller's bankruptcy or otherwise. In
such event, the Fund would attempt to exercise its rights with respect to the   
underlying security, including possible sale of the securities. A Fund may incur
various expenses in connection with the exercise of its rights and may be       
subject to various delays and risks of loss, including (a) possible declines in 
the value of the underlying securities, (b) possible reduction in levels of     
income and (c) lack of access to the securities (if they are held through a     
third-party custodian) and possible inability to enforce the Fund's rights. The 
Fund's Board has established procedures, which are periodically reviewed by the 
Board, pursuant to which the Adviser monitors the creditworthiness of the       
dealers with which the Fund enters into repurchase agreement transactions.      

      A Fund may enter into repurchase agreements pertaining to U.S.
Government securities with member banks of the Federal Reserve System or        
"primary dealers" (as designated by the Federal Reserve Bank of New York) in    
such securities. There is no percentage restriction on a Fund's ability to enter
into repurchase agreements. Currently, each Fund intends to enter into          
repurchase agreements only with its custodian and such primary dealers.         

           A Fund may enter into buy/sell back transactions, which are similar
to repurchase agreements. In this type of transaction, a Fund enters a trade to 
buy securities at one price and simultaneously enters a trade to sell the same  
securities at another price on a specified date. Similar to a repurchase        
agreement, the repurchase price is higher than the sale price and reflects      
current interest rates. Unlike a repurchase agreement, however, the buy/sell    
back transaction, though done simultaneously, is two separate legal agreements. 
A buy/sell back transaction also differs from a repurchase agreement in that the
seller is not required to provide margin payments if the value of the securities
falls below the repurchase price because the transaction is two separate        
transactions. Each Fund has the risk of changes in the value of the purchased   
security during the term of the buy/sell back agreement although these          
agreements typically provide for the repricing of the original transaction at a 
new market price if the value of the security changes by a specific amount.     

Reverse Repurchase Agreements and Dollar Rolls                                  
----------------------------------------------                                  

            Reverse repurchase agreements are identical to repurchase agreements
except that rather than buying securities for cash subject to their repurchase  
by the seller, a Fund sells portfolio assets concurrently with an agreement by  
the Fund to repurchase the same assets at a later date at a fixed price slightly
higher than the sale price. During the reverse repurchase agreement period, the 
Fund continues to receive principal and interest payments on these securities.  
Generally, the effect of a reverse repurchase agreement is that the Fund can    
recover all or most of the cash invested in the portfolio securities involved   
during the term of the reverse repurchase agreement, while it will be able to   
keep the interest income associated with those portfolio securities. Such       
transactions are advantageous only if the "interest cost" to the Fund of the    
reverse repurchase transaction, i.e., the difference between the sale and       
repurchase price for the securities, is less than the cost of otherwise         
obtaining the cash.                                                             

          Dollar rolls involve sales by a Fund of securities for delivery in
the current month and the Fund's simultaneously contracting to repurchase       
substantially similar (same type and coupon) securities on a specified future   
date. During the roll period, the Fund forgoes principal and interest paid on   
the securities. The Fund is compensated by the difference between the current   
sales price and the lower forward price for the future purchase (often referred 
to as the "drop") as well as by the interest earned on the cash proceeds of the 
initial sale.                                                                   

            Reverse repurchase agreements and dollar rolls involve the risk that
the market value of the securities the Fund is obligated to repurchase under the
agreement may decline below the repurchase price. In the event the buyer of     
securities under a reverse repurchase agreement or dollar roll files for        
bankruptcy or becomes insolvent, the Fund's use of the proceeds of the agreement
may be restricted pending a determination by the other party, or its trustee or 
receiver, whether to enforce the Fund's obligation to repurchase the securities.
In addition, the use of these investments results in leveraging the Fund's      
common stocks because the Fund uses the proceeds to make investments in other   
securities. See Borrowing and Use of Leverage below.                            

Securities Ratings                                                              
------------------                                                              

         The ratings of fixed-income securities by Moody's, S&P, and Fitch
Ratings ("Fitch"), Dominion Bond Rating Service Ltd. and A.M. Best Company are a
generally accepted barometer of credit risk. They are, however, subject to      
certain limitations from an investor's standpoint. The rating of an issuer is   
heavily weighted by past developments and does not necessarily reflect probable 
future conditions. There is frequently a lag between the time a rating is       
assigned and the time it is updated. In addition, there may be varying degrees  
of difference in credit risk of securities within each rating category.         

        Securities rated Baa, BBB+, BBB, or BBB- by S&P or Baa1, Baa2 or
Baa3 by Moody's are considered by Moody's to have speculative characteristics.  
Sustained periods of deteriorating economic conditions or rising interest rates 
are more likely to lead to a weakening in the issuer's capacity to pay interest 
and repay principal than in the case of higher-rated securities.                

        Non-rated securities will also be considered for investment by a
Fund when the Adviser believes that the financial condition of the issuers of   
such securities, or the protection afforded by the terms of the securities      
themselves, limits the risk to the Fund to a degree comparable to that of rated 
securities which are consistent with the Fund's objectives and policies.        

            The Adviser generally uses ratings issued by S&P, Moody's, Fitch and
Dominion Bond Rating Service Ltd. Some securities are rated by more than one of 
these ratings agencies, and the ratings assigned to the security by the rating  
agencies may differ. In such an event and for purposes of determining compliance
with restrictions on investments for the Fund, if a security is rated by two or 
more rating agencies, the Adviser will deem the security to be rated at the     
highest rating. For example, if a security is rated by Moody's and S&P only,    
with Moody's rating the security as Ba and S&P as BBB, the Adviser will deem the
security to be rated as the equivalent of BBB (i.e., Baa by Moody's and BBB by  
S&P). Or, if a security is rated by Moody's, S&P and Fitch, with Moody's rating 
the security as Ba, S&P as BBB and Fitch as BB, the Adviser will deem the       
security to be rated as the equivalent of BBB (i.e., Ba1 by Moody's, BBB by S&P 
and BBB by Fitch).                                                              

      The Adviser will try to reduce the risk inherent in the Fund's
investment approach through credit analysis, diversification and attention to   
current developments and trends in interest rates and economic conditions.      
However, there can be no assurance that losses will not occur. In considering   
investments for Funds that invest in high-yielding securities, the Adviser will 
attempt to identify those high-yielding securities whose financial condition is 
adequate to meet future obligations, has improved, or is expected to improve in 
the future. The Adviser's analysis focuses on relative values based on such     
factors as interest or dividend coverage, asset coverage, earnings prospects,   
and the experience and managerial strength of the issuer.                       

          In the event that the credit rating of a security held by the Fund
is downgraded, the credit quality deteriorates after purchase, or the security  
defaults, the Fund will not be obligated to dispose of that security and may    
continue to hold the security if, in the opinion of the Adviser, such investment
is appropriate in the circumstances.                                            

           Unless otherwise indicated, references to securities ratings by one
rating agency in this SAI shall include the equivalent rating by another rating 
agency.                                                                         

Short Sales                                                                     
-----------                                                                     

           A short sale is effected by selling a security that a Fund does not
own, or if the Fund does own such security, it is not to be delivered upon      
consummation of the sale. A Fund may make short sales of securities or maintain 
a short position only for the purpose of deferring realization of gain or loss  
for U.S. federal income tax purposes, provided that at all times when a short   
position is open the Fund owns an equal amount of such securities of the same   
issue as, and equal in amount to, the securities sold short. In addition, the   
Fund may not make a short sale if more than 10% of the Fund's net assets (taken 
at market value) is held as collateral for short sales at any one time. A short 
sale of a security involves the risk that, instead of declining, the price of   
the security sold short will rise. If the price of the securities sold short    
increases between the time of a short sale and the time a Fund replaces the     
borrowed security, the Fund will incur a loss; conversely, if the price         
declines, the Fund will realize a gain. The potential for the price of a        
fixed-income security sold short to rise is a function of both the remaining    
maturity of the obligation, its creditworthiness and its yield. Unlike short    
sales of equities or other instruments, potential for the price of a            
fixed-income security to rise may be limited due to the fact that the security  
will be no more than par at maturity. However, the short sale of other          
instruments or securities generally, including fixed-income securities          
convertible into equities or other instruments, a fixed-income security trading 
at a deep discount from par or which pays a coupon that is high in relative or  
absolute terms, or which is denominated in a currency other than the U.S.       
Dollar, involves the possibility of a theoretically unlimited loss since there  
is a theoretically unlimited potential for the market price of the security sold
short to increase. See "Dividends, Distributions and Taxes-Tax Straddles" for a 
discussion of certain special federal income tax considerations that may apply  
to short sales which are entered into by the Fund.                              

Structured Securities                                                           
---------------------                                                           

   A Fund may invest securities issued in structured financing
transactions, which generally involve aggregating types of debt assets in a pool
or special purpose entity and then issuing new securities. Types of structured  
financings include, for example, mortgage-related and other asset-backed        
securities. A Fund's investments include investments in structured securities   
that represent interests in entities organized and operated solely for the      
purpose of restructuring the investment characteristics of debt obligations.    
This type of restructuring involves the deposit with or purchase by an entity,  
such as a corporation or trust, of specified instruments (such as commercial    
bank loans) and the issuance by that entity of one or more classes of securities
("Structured Securities") backed by, or representing interests in, the          
underlying instruments. The cash flow on the underlying instruments may be      
apportioned among the newly issued Structured Securities to create securities   
with different investment characteristics such as varying maturities, payment   
priorities and interest rate provisions, and the extent of the payments made    
with respect to Structured Securities is dependent on the extent of the cash    
flow on the underlying instruments. Because Structured Securities of the type in
which the Fund anticipates it will invest typically involve no credit           
enhancement, their credit risk generally will be equivalent to that of the      
underlying instruments.                                                         

         A Fund is permitted to invest in a class of Structured Securities
that is either subordinated or unsubordinated to the right of payment of another
class. Subordinated Structured Securities typically have higher yields and      
present greater risks than unsubordinated Structured Securities.                

          Under the terms of subordinated securities, payments that would be
made to their holders may be required to be made to the holders of more senior  
securities and/or the subordinated or junior securities may have junior liens,  
if they have any rights at all, in any collateral (meaning proceeds of the      
collateral are required to be paid first to holders of more senior securities). 
As a result, subordinated or junior securities will be disproportionately       
affected by a default or even a perceived decline in the creditworthiness of the
issuer.                                                                         

U.S. Government Securities                                                      
--------------------------                                                      

      U.S. Government securities may be backed by the full faith and
credit of the U.S., supported only by the right of the issuer to borrow from the
U.S. Treasury or backed only by the credit of the issuing agency itself. These  
securities include: (i) the following U.S. Treasury securities, which are backed
by the full faith and credit of the U.S. and differ only in their interest      
rates, maturities and times of issuance: U.S. Treasury bills (maturities of one 
year or less with no interest paid and hence issued at a discount and repaid at 
full face value upon maturity), U.S. Treasury notes (maturities of one to ten   
years with interest payable every six months) and U.S. Treasury bonds (generally
maturities of greater than ten years with interest payable every six months);   
(ii) obligations issued or guaranteed by U.S. Government agencies and           
instrumentalities that are supported by the full faith and credit of the U.S.   
Government, such as securities issued by GNMA, the Farmers Home Administration, 
the Department of Housing and Urban Development, the Export-Import Bank, the    
General Services Administration and the Small Business Administration and       
including obligations that are issued by private issuers that are guaranteed as 
to principal or interest by the U.S. Government, its agencies or institutions;  
and (iii) obligations issued or guaranteed by U.S. government agencies and      
instrumentalities that were historically not supported by the full faith and    
credit of the U.S. Government or a right to borrow from the U.S. Treasury, such 
as securities issued by the FNMA and FHLMC(which are, as described above, now in
effect backed by the full faith and credit of the U.S. Government due to the    
conservatorship of the agencies), and governmental collateralized mortgage      
obligations ("CMOs"). The maturities of the U.S. Government securities listed in
paragraphs (i) and (ii) above usually range from three months to 30 years. Such 
securities, except GNMA certificates, normally provide for periodic payments of 
interest in fixed amount with principal payments at maturity or specified call  
dates.                                                                          

          U.S. Government securities also include zero coupon securities and
principal-only securities and certain stripped mortgage-related securities. Zero
coupon securities are described in more detail in "Zero Coupon Securities"      
below, and stripped mortgage-related securities and principal-only securities   
are described in more detail in "Mortgage-Related Securities and Other          
Asset-Backed Securities -Stripped Mortgage-Related Securities" above. In        
addition, other U.S. Government agencies and instrumentalities have issued      
stripped securities that are similar to SMRS.                                   

Inflation-protected securities, or IPS, such as Treasury
Inflation-Protected Securities, or TIPS, are fixed income securities whose      
principal value is periodically adjusted according to the rate of inflation. If 
the index measuring inflation falls, the principal value of these securities    
will be adjusted downward, and consequently the interest payable on these       
securities (calculated with respect to a smaller principal amount) will be      
reduced. Repayment of the original bond principal upon maturity (as adjusted for
inflation) is guaranteed in the case of U.S. Treasury inflation-protected       
securities. For bonds that do not provide a similar guarantee, the adjusted     
principal value of the bond repaid at maturity may be less than the original    
principal.                                                                      

       Inflation-protected securities tend to react to changes in real
interest rates. In general, the price of an inflation-protected debt security   
can fall when real interest rates rise, and can rise when real interest rates   
fall. In addition, the value of inflation-protected securities may be vulnerable
to changes in expectations of inflation. Interest payments on                   
inflation-protected debt securities can be unpredictable and will vary as the   
principal and/or interest is adjusted for inflation.                            

          TIPS, which are issued by the U.S Treasury, use the Consumer Price
Index for Urban Consumers, or the CPI, as the inflation measure. The principal  
of a TIPS increases with inflation and decreases with deflation, as measured by 
the CPI. When a TIPS matures, the holder is paid the adjusted principal or      
original principal, whichever is greater. TIPS pay interest twice a year, at a  
fixed rate, which is determined by auction at the time the TIPS are issued. The 
rate is applied to the adjusted principal; so, like the principal, interest     
payments rise with inflation and fall with deflation. TIPS are issued in terms  
of 5, 10, and 20 years.                                                         

          Guarantees of securities by the U.S. Government or its agencies or
instrumentalities guarantee only the payment of principal and interest on the   
securities, and do not guarantee the securities' yield or value or the yield or 
value of the shares of the Fund that holds the securities.                      

     U.S. Government securities are considered among the safest of
fixed-income investments. As a result, however, their yields are generally lower
than the yields available from other fixed-income securities.                   

Variable, Floating and Inverse Floating Rate Securities                         
-------------------------------------------------------                         

       These securities have interest rates that are reset at periodic
intervals, usually by reference to some interest rate index or market interest  
rate. Some of these securities are backed by pools of mortgage loans. Although  
the rate adjustment feature may act as a buffer to reduce sharp changes in the  
value of these securities, they are still subject to changes in value based on  
changes in market interest rates or changes in the issuer's creditworthiness.   
Because the interest rate is reset only periodically, changes in the interest   
rate on these securities may lag behind changes in prevailing market interest   
rates. Also, some of these securities (or the underlying mortgages) are subject 
to caps or floors that limit the maximum change in the interest rate during a   
specified period or over the life of the security.                              

Zero Coupon Securities                                                          
----------------------                                                          

        A zero coupon security pays no interest to its holder during its
life. An investor acquires a zero coupon security at a discounted price from the
face value of the security, which is generally based upon its present value, and
which, depending upon the time remaining until maturity, may be significantly   
less than its face value (sometimes referred to as a "deep discount" price).    
Upon maturity of the zero coupon security, the investor receives the face value 
of the security.                                                                

           A Fund may invest in zero coupon Treasury securities, which consist
of Treasury bills or the principal components of U.S. Treasury bonds or notes. A
Fund may also invest in zero coupon securities issued by U.S. Government        
agencies or instrumentalities that are supported by the full faith and credit of
the U.S., which consist of the principal components of securities of U.S.       
Government agencies or instrumentalities.                                       

            Currently, the only U.S. Treasury security issued without coupons is
the Treasury bill. The zero coupon securities purchased by the Fund may consist 
of principal components held in STRIPS form issued through the U.S. Treasury's  
STRIPS program, which permits the beneficial ownership of the component to be   
recorded directly in the Treasury book-entry system. In addition, in the last   
few years a number of banks and brokerage firms have separated ("stripped") the 
principal portions ("corpus") from the coupon portions of the U.S. Treasury     
bonds and notes and sold them separately in the form of receipts or certificates
representing undivided interests in these instruments (which instruments are    
generally held by a bank in a custodial or trust account).                      

          Because zero coupon securities trade at a discount from their face
or par value but pay no periodic interest, they are subject to greater          
fluctuations of market value in response to changing interest rates than debt   
obligations of comparable maturities which make periodic distributions of       
interest.                                                                       

            Current federal tax law requires that a holder (such as the Fund) of
a zero coupon security accrue a portion of the discount at which the security   
was purchased as income each year even though the holder receives no interest   
payment in cash on the security during the year (generally referred to as       
"original issue discount" or "OID"). As a result, in order to make the          
distributions necessary for the Fund not to be subject to federal income or     
excise taxes, the Fund may be required to pay out as an income distribution each
year an amount, obtained by liquidation of portfolio securities or borrowings if
necessary, greater than the total amount of cash that the Fund has actually     
received as interest during the year. A Fund believes, however, that it is      
highly unlikely that it would be necessary to liquidate portfolio securities or 
borrow money in order to make such required distributions or to meet its        
investment objective.                                                           

Certain Risk and Other Considerations                                           
-------------------------------------                                           

    Borrowing and Use of Leverage. A Fund may use borrowings for
investment purposes subject to the restrictions of the 1940 Act. A Fund may also
use leverage for investment purposes by entering into transactions such as      
reverse repurchase agreements, forward contracts and dollar rolls. This means   
that the Fund uses the cash proceeds made available during the term of these    
transactions to make investments in other securities.                           

         Borrowings by a Fund result in leveraging of the Fund's shares of
common stock. The proceeds of such borrowings will be invested in accordance    
with the Fund's investment objective and policies. The Adviser anticipates that 
the difference between the interest expense paid by the Fund on borrowings and  
the rates received by the Fund from its investment portfolio issuers will       
provide the Fund's shareholders with a potentially higher yield.                

         Utilization of leverage, which is usually considered speculative,
however, involves certain risks to the Fund's shareholders. These include a     
higher volatility of the NAV of the Fund's shares of common stock and the       
relatively greater effect on the NAV of the shares caused by favorable or       
adverse changes in market conditions or interest rates. So long as the Fund is  
able to realize a net return on the leveraged portion of its investment         
portfolio that is higher than the interest expense paid on borrowings or the    
carrying costs of leveraged transactions, the effect of leverage will be to     
cause the Fund's shareholders to realize higher current net investment income   
than if the Fund were not leveraged. However, to the extent that the interest   
expense on borrowings or the carrying costs of leveraged transactions approaches
the net return on the leveraged portion of the Fund's investment portfolio, the 
benefit of leverage to the Fund's shareholders will be reduced, and if the      
interest expense on borrowings or the carrying costs of leveraged transactions  
were to exceed the net return to shareholders, the Fund's use of leverage would 
result in a lower rate of return than if the Fund were not leveraged. Similarly,
the effect of leverage in a declining market could be a greater decrease in NAV 
per share than if the Fund were not leveraged. In an extreme case, if the Fund's
current investment income were not sufficient to meet the interest expense on   
borrowings or the carrying costs of leveraged transactions, it could be         
necessary for the Fund to liquidate certain of its investments, thereby reducing
the NAV of the Fund's shares.                                                   

       Certain transactions, such as derivatives transactions, forward
commitments, reverse repurchase agreements and short sales involve leverage and 
may expose a Fund to potential losses that, in some cases, may exceed the amount
originally invested by the Fund. When a Fund engages in such transactions, it   
will, in accordance with guidance provided by the Commission or its staff in,   
among other things, regulations, interpretative releases and no-action letters, 
deposit in a segregated account certain liquid assets with a value at least     
equal to the Fund's exposure, on a marked-to-market or other relevant basis, to 
the transaction. Transactions for which assets have been segregated will not be 
considered "senior securities" for purposes of the Fund's investment restriction
concerning senior securities. The segregation of assets is intended to enable   
the Fund to have assets available to satisfy its obligations with respect to    
these transactions, but will not limit the Fund's exposure to loss.             
      Investments in Lower-Rated and Unrated Instruments. A Fund may
invest in lower-rated securities, in some cases, substantially (High Income),   
which may include securities having the lowest rating for non-subordinated debt 
securities (i.e., rated C by Moody's or CCC or lower by S&P & Fitch) and unrated
securities of equivalent investment quality. Debt securities with such a rating 
are considered by the rating organizations to be subject to greater risk of loss
of principal and interest than higher-rated securities and are considered to be 
predominantly speculative with respect to the issuer's capacity to pay interest 
and repay principal, which may in any case decline during sustained periods of  
deteriorating economic conditions or rising interest rates. These securities are
considered to have extremely poor prospects of ever attaining any real          
investment standing, to have a current identifiable vulnerability to default, to
be unlikely to have the capacity to pay interest and repay principal when due in
the event of adverse business, financial or economic conditions, and/or to be in
default or not current in the payment of interest or principal.                 

        Lower-rated securities generally are considered to be subject to
greater market risk than higher-rated securities in times of deteriorating      
economic conditions. In addition, lower-rated securities may be more susceptible
to real or perceived adverse economic and competitive industry conditions than  
investment grade securities, although the market values of securities rated     
below investment grade and comparable unrated securities tend to react less to  
fluctuations in interest rate levels than do those of higher-rated securities.  
The market for lower-rated securities may be thinner and less active than that  
for higher-quality securities, which can adversely affect the prices at which   
these securities can be sold. To the extent that there is no established        
secondary market for lower-rated securities, the Adviser may experience         
difficulty in valuing such securities and, in turn, a Fund's assets. In         
addition, adverse publicity and investor perceptions about lower-rated          
securities, whether or not based on fundamental analysis, may tend to decrease  
the market value and liquidity of such lower-rated securities. Transaction costs
with respect to lower-rated securities may be higher, and in some cases         
information may be less available, than is the case with investment grade       
securities.                                                                     

      Many fixed-income securities, including certain U.S. corporate
fixed-income securities in which a Fund may invest, contain call or buy-back    
features that permit the issuer of the security to call or repurchase it. Such  
securities may present risks based on payment expectations. If an issuer        
exercises such a "call option" and redeems the security, the Fund may have to   
replace the called security with a lower yielding security, resulting in a      
decreased rate of return for the Fund.                                          

           In seeking to achieve a Fund's investment objectives, there will be
times, such as during periods of rising interest rates, when depreciation and   
realization of capital losses on securities in the Fund's portfolio will be     
unavoidable. Moreover, medium and lower rated securities and non-rated          
securities of comparable quality may be subject to wider fluctuations in yield  
and market values than higher-rated securities under certain market conditions. 
Such fluctuations after a security is acquired do not affect the cash income    
received from that security but are reflected in the NAV of the Fund.           

         U.S. Corporate Fixed-Income Securities. A Fund may invest in U.S.
corporate fixed-income securities that may include securities issued in         
connection with corporate restructurings such as takeovers or leveraged buyouts,
which may pose particular risks. Securities issued to finance corporate         
restructurings may have special credit risks due to the highly leveraged        
conditions of the issuer. In addition, such issuers may lose experienced        
management as a result of the restructuring. Finally, the market price of such  
securities may be more volatile to the extent that expected benefits from the   
restructuring do not materialize. A Fund may also invest in U.S. corporate      
fixed-income securities that are not current in the payment of interest or      
principal or are in default, so long as the Adviser believes such investment is 
consistent with the Fund's investment objectives. A Fund's rights with respect  
to defaults on such securities will be subject to applicable U.S. bankruptcy,   
moratorium and other similar laws.                                              

    Risks of Investments in Foreign Securities. Investors should
understand and consider carefully the substantial risks involved in securities  
of foreign companies and governments of foreign nations, some of which are      
referred to below, and which are in addition to the usual risks inherent in     
domestic investments. Investing in securities of non-U.S. companies which are   
generally denominated in foreign currencies, and utilization of derivative      
investment products denominated in, or the value of which is dependent upon     
movements in the relative value of, a foreign currency, involve certain         
considerations comprising both risk and opportunity not typically associated    
with investing in U.S. companies. These considerations include changes in       
exchange rates and exchange control regulations, political and social           
instability, expropriation, imposition of foreign taxes, less liquid markets and
less available information than are generally the case in the U.S., higher      
transaction costs, less government supervision of exchanges, brokers and        
issuers, difficulty in enforcing contractual obligations, lack of uniform       
accounting and auditing standards and greater price volatility.                 

            There is generally less publicly available information about foreign
companies comparable to reports and ratings that are published about companies  
in the U.S. Foreign issuers are subject to accounting and financial standards   
and requirements that differ, in some cases significantly, from those applicable
to U.S. issuers. In particular, the assets and profits appearing on the         
financial statements of a foreign issuer may not reflect its financial position 
or results of operations in the way they would be reflected had the financial   
statement been prepared in accordance with U.S. generally accepted accounting   
principles. In addition, for an issuer that keeps accounting records in local   
currency, inflation accounting rules in some of the countries in which the Fund 
may invest require, for both tax and accounting purposes, that certain assets   
and liabilities be restated on the issuer's balance sheet in order to express   
items in terms of currency of constant purchasing power. Inflation accounting   
may indirectly generate losses or profits. Consequently, financial data may be  
materially affected by restatements for inflation and may not accurately reflect
the real condition of those issuers and securities markets. Substantially less  
information is publicly available about certain non-U.S. issuers than is        
available about U.S. issuers.                                                   

       It is contemplated that foreign securities will be purchased in
over-the-counter markets or on stock exchanges located in the countries in which
the respective principal offices of the issuers of the various securities are   
located, if that is the best available market. Foreign securities markets are   
generally not as developed or efficient as those in the U.S. While growing in   
volume, they usually have substantially less volume than the Exchange, and      
securities of some foreign companies are less liquid and more volatile than     
securities of comparable U.S. companies. Similarly, volume and liquidity in most
foreign bond markets is less than in the U.S. and, at times, volatility of price
can be greater than in the U.S. Fixed commissions on foreign stock exchanges    
are generally higher than negotiated commissions on U.S. exchanges, although a  
Fund will endeavor to achieve the most favorable net results on its portfolio   
transactions. There is generally less government supervision and regulation of  
stock exchanges, brokers and listed companies than in the U.S.                  

         Expropriation, confiscatory taxation, nationalization, political,
economic or social instability or other similar developments, such as military  
coups, have occurred in the past in countries in which a Fund may invest and    
could adversely affect a Fund's assets should these conditions or events recur. 

         Foreign investment in certain foreign securities is restricted or
controlled to varying degrees. These restrictions or controls may at times limit
or preclude foreign investment in certain foreign securities and increase the   
costs and expenses of a Fund. Certain countries in which the Fund may invest    
require governmental approval prior to investments by foreign persons, limit the
amount of investment by foreign persons in a particular issuer, limit the       
investment by foreign persons only to a specific class of securities of an      
issuer that may have less advantageous rights than the classes available for    
purchase by domiciliaries of the countries and/or impose additional taxes on    
foreign investors.                                                              

   Certain countries may require governmental approval for the
repatriation of investment income, capital or the proceeds of sales of          
securities by foreign investors. In addition, if a deterioration occurs in a    
country's balance of payments, the country could impose temporary restrictions  
on foreign capital remittances.                                                 

          Income from certain investments held by a Fund could be reduced by
foreign income taxes, including withholding taxes. It is impossible to determine
the effective rate of foreign tax in advance. A Fund's NAV may also be affected 
by changes in the rates or methods of taxation applicable to that Fund or to    
entities in which that Fund has invested. The Adviser generally will consider   
the cost of any taxes in determining whether to acquire any particular          
investments, but can provide no assurance that the tax treatment of investments 
held by the Fund will not be subject to change. A shareholder otherwise subject 
to U.S. federal income taxes may, subject to certain limitations, be entitled to
claim a credit or deduction for U.S. federal income tax purposes for his or her 
proportionate share of such foreign taxes paid by the Fund. See "U.S. Federal   
Income Taxes."                                                                  

    Investors should understand that the expense ratio of a fund
investing in foreign securities may be higher than investment companies         
investing only in domestic securities since, among other things, the cost of    
maintaining the custody of foreign securities is higher and the purchase and    
sale of portfolio securities may be subject to higher transaction charges, such 
as stamp duties and turnover taxes.                                             

      For many foreign securities, there are U.S. Dollar-denominated
American Depositary Receipts ("ADRs") which are traded in the U.S. on exchanges 
or over-the-counter and are issued by domestic banks or trust companies and for 
which market quotations are readily available. ADRs do not lessen the foreign   
exchange risk inherent in investing in the securities of foreign issuers.       
However, by investing in ADRs rather than directly in stock of foreign issuers, 
a Fund can avoid currency risks which might occur during the settlement period  
for either purchases or sales. A Fund may purchase foreign securities directly, 
as well as through ADRs.                                                        

      Foreign Currency Transactions. A Fund may invest in securities
denominated in foreign currencies and a corresponding portion of the Fund's     
revenues will be received in such currencies. In addition, a Fund may conduct   
foreign currency transactions for hedging and non-hedging purposes on a spot    
(i.e., cash) basis or through the use of derivatives transactions, such as      
forward currency exchange contracts, currency futures and options thereon, and  
options on currencies as described above. The dollar equivalent of a Fund's net 
assets and distributions will be adversely affected by reductions in the value  
of certain foreign currencies relative to the U.S. Dollar. Such changes will    
also affect a Fund's income. A Fund will, however, have the ability to attempt  
to protect itself against adverse changes in the values of foreign currencies by
engaging in certain of the investment practices listed above. While a Fund has  
this ability, there is no certainty as to whether and to what extent the Fund   
will engage in these practices.                                                 
      Currency exchange rates may fluctuate significantly over short
periods of time causing, along with other factors, a Fund's NAV to fluctuate.   
Currency exchange rates generally are determined by the forces of supply and    
demand in the foreign exchange markets and the relative merits of investments in
different countries, actual or anticipated changes in interest rates and other  
complex factors, as seen from an international perspective. Currency exchange   
rates also can be affected unpredictably by the intervention of U.S. or foreign 
governments or central banks, or the failure to intervene, or by currency       
controls or political developments in the U.S. or abroad. To the extent a Fund's
total assets adjusted to reflect the Fund's net position after giving effect to 
currency transactions is denominated or quoted in the currencies of foreign     
countries, the Fund will be more susceptible to the risk of adverse economic and
political developments within those countries.                                  

      A Fund will incur costs in connection with conversions between
various currencies. A Fund may hold foreign currency received in connection with
investments when, in the judgment of the Adviser, it would be beneficial to     
convert such currency into U.S. Dollars at a later date, based on anticipated   
changes in the relevant exchange rate. If the value of the foreign currencies in
which a Fund receives its income falls relative to the U.S. Dollar between      
receipt of the income and the making of Fund distributions, the Fund may be     
required to liquidate securities in order to make distributions if the Fund has 
insufficient cash in U.S. Dollars to meet, among other things, distribution     
requirements that the Fund must satisfy to qualify as a regulated investment    
company for federal income tax purposes. Similarly, if the value of a particular
foreign currency declines between the time a Fund incurs expenses in U.S.       
Dollars and the time cash expenses are paid, the amount of the currency required
to be converted into U.S. Dollars in order to pay expenses in U.S. Dollars could
be greater than the equivalent amount of such expenses in the currency at the   
time they were incurred. In light of these risks, a Fund may engage in certain  
currency hedging transactions, which themselves, involve certain special risks. 
See "Additional Investment Policies and Practices," above.                      

           Additional Risks of Options on Forward Currency Exchange Contracts,
Options on Foreign Currencies and Other Options.                                

           Unlike transactions entered into by a Fund in futures contracts and
exchange-traded options, options on foreign currencies and forward currency     
exchange contracts may not be traded on contract markets regulated by the       
Commodity Futures Trading Commission (the "CFTC") or (with the exception of     
certain foreign currency options) by the Commission. Such instruments may       
instead be traded through financial institutions acting as market-makers,       
although foreign currency options are also traded on certain national securities
exchanges, such as the Philadelphia Stock Exchange and the Chicago Board Options
Exchange, subject to Commission regulation. Similarly, options on currencies may
be traded over-the-counter. In an over-the-counter trading environment, many of 
the protections afforded to exchange participants will not be available. For    
example, there are no daily price fluctuation limits, and adverse market        
movements could therefore continue to an unlimited extent over a period of time.
Although the purchaser of an option cannot lose more than the amount of the     
premium plus related transaction costs, this entire amount could be lost.       
Moreover, the option writer and a trader of forward currency exchange contracts 
could lose amounts substantially in excess of their initial investments, due to 
the margin and collateral requirements associated with such positions.          

     Over-the-counter transactions can be entered into only with a
financial institution willing to take the opposite side, as principal, of a     
Fund's position unless the institution acts as broker and is able to find       
another counterparty willing to enter into the transaction with the Fund. Where 
no such counterparty is available, it will not be possible to enter into a      
desired transaction. There also may be no liquid secondary market in the trading
of over-the-counter contracts, and a Fund could be required to retain options   
purchased or written, or forward currency exchange contracts entered into, until
exercise, expiration or maturity. This in turn could limit the Fund's ability to
profit from open positions or to reduce losses experienced, and could result in 
greater losses.                                                                 

     Further, over-the-counter transactions are not subject to the
guarantee of an exchange clearing house, and a Fund will therefore be subject to
the risk of default by, or the bankruptcy of, the financial institution serving 
as its counterparty. A Fund will enter into an over-the-counter transaction only
with parties whose creditworthiness has been reviewed and found to be           
satisfactory by the Adviser.                                                    

          Transactions in over-the-counter options on foreign currencies are
subject to a number of conditions regarding the commercial purpose of the       
purchaser of such option. A Fund is not able to determine at this time whether  
or to what extent additional restrictions on the trading of over-the-counter    
options on foreign currencies may be imposed at some point in the future, or the
effect that any such restrictions may have on the hedging strategies to be      
implemented by them.                                                            

   Options on foreign currencies traded on national securities
exchanges are within the jurisdiction of the Commission, as are other securities
traded on such exchanges. As a result, many of the protections provided to      
traders on organized exchanges will be available with respect to such           
transactions. In particular, all foreign currency option positions entered into 
on a national securities exchange are cleared and guaranteed by the Options     
Clearing Corporation ("OCC"), thereby reducing the risk of counterparty default.
Further, a liquid secondary market in options traded on a national securities   
exchange may be more readily available than in the over-the-counter market,     
potentially permitting the Fund to liquidate open positions at a profit prior to
exercise or expiration, or to limit losses in the event of adverse market       
movements.                                                                      

          The purchase and sale of exchange-traded foreign currency options,
however, is subject to the risks of the availability of a liquid secondary      
market described above, as well as the risks regarding adverse market movements,
margining of options written, the nature of the foreign currency market,        
possible intervention by governmental authorities and the effects of other      
political and economic events. In addition, exchange-traded options on foreign  
currencies involve certain risks not presented by the over-the-counter market.  
For example, exercise and settlement of such options must be made exclusively   
through the OCC, which has established banking relationships in applicable      
foreign countries for this purpose. As a result, the OCC may, if it determines  
that foreign governmental restrictions or taxes would prevent the orderly       
settlement of foreign currency option exercises, or would result in undue       
burdens on the OCC or its clearing member, impose special procedures on exercise
and settlement, such as technical changes in the mechanics of delivery of       
currency, the fixing of dollar settlement prices or prohibitions, on exercise.  

            Options on U.S. Government Securities, futures contracts, options on
futures contracts, forward currency exchange contracts and options on foreign   
currencies may be traded on foreign exchanges. Such transactions are subject to 
the risk of governmental actions affecting trading in or the prices of foreign  
currencies or securities. The value of such positions also could be adversely   
affected by (i) other complex foreign political and economic factors, (ii)      
lesser availability than in the U.S. of data on which to make trading decisions,
(iii) delays in the Fund's ability to act upon economic events occurring in     
foreign markets during nonbusiness hours in the U.S., (iv) the imposition of    
different exercise and settlement terms and procedures and margin requirements  
than in the U.S., and (v) lesser trading volume period.                         

        Sovereign Debt Obligations. No established secondary markets may
exist for many of the Sovereign Debt Obligations in which a Fund may invest.    
Reduced secondary market liquidity may have an adverse effect on the market     
price and the Fund's ability to dispose of particular instruments when necessary
to meet its liquidity requirements or in response to specific economic events   
such as a deterioration in the creditworthiness of the issuer. Reduced secondary
market liquidity for certain Sovereign Debt Obligations may also make it more   
difficult for the Fund to obtain accurate market quotations for the purpose of  
valuing its portfolio. Market quotations are generally available on many        
Sovereign Debt Obligations only from a limited number of dealers and may not    
necessarily represent firm bids of those dealers or prices for actual sales.    
          By investing in Sovereign Debt Obligations, a Fund will be exposed
to the direct or indirect consequences of political, social and economic changes
in various countries. Political changes in a country may affect the willingness 
of a foreign government to make or provide for timely payments of its           
obligations. The country's economic status, as reflected, among other things, in
its inflation rate, the amount of its external debt and its gross domestic      
product, will also affect the government's ability to honor its obligations.    

         Many countries providing investment opportunities for a Fund have
experienced substantial, and in some periods extremely high, rates of inflation 
for many years. Inflation and rapid fluctuations in inflation rates have had and
may continue to have adverse effects on the economies and securities markets of 
certain of these countries. In an attempt to control inflation, wage and price  
controls have been imposed in certain countries.                                
     Investing in Sovereign Debt Obligations involves economic and
political risks. The Sovereign Debt Obligations in which a Fund may invest in   
most cases pertain to countries that are among the world's largest debtors to   
commercial banks, foreign governments, international financial organizations and
other financial institutions. In recent years, the governments of some of these 
countries have encountered difficulties in servicing their external debt        
obligations, which led to defaults on certain obligations and the restructuring 
of certain indebtedness. Restructuring arrangements have included, among other  
things, obtaining new credit to finance interest payments. Certain governments  
have not been able to make payments of interest on or principal of Sovereign    
Debt Obligations as those payments have come due. Obligations arising from past 
restructuring agreements may affect the economic performance and political and  
social stability of those issuers.                                              

          Central banks and other governmental authorities which control the
servicing of Sovereign Debt Obligations may not be willing or able to permit the
payment of the principal or interest when due in accordance with the terms of   
the obligations. As a result, the issuers of Sovereign Debt Obligations may     
default on their obligations. Defaults on certain Sovereign Debt Obligations    
have occurred in the past. Holders of certain Sovereign Debt Obligations may be 
requested to participate in the restructuring and rescheduling of these         
obligations and to extend further loans to the issuers. The interests of holders
of Sovereign Debt Obligations could be adversely affected in the course of      
restructuring arrangements or by certain other factors referred to below.       
Furthermore, some of the participants in the secondary market for Sovereign Debt
Obligations may also be directly involved in negotiating the terms of these     
arrangements and may therefore have access to information not available to other
market participants.                                                            

   The ability of governments to make timely payments on their
obligations is likely to be influenced strongly by the issuer's balance of      
payments, including export performance, and its access to international credits 
and investments. A country whose exports are concentrated in a few commodities  
could be vulnerable to a decline in the international prices of one or more of  
those commodities. Increased protectionism on the part of a country's trading   
partners could also adversely affect the country's exports and diminish its     
trade account surplus, if any.                                                  

        To the extent that a country receives payment for its exports in
currencies other than dollars, its ability to make debt payments denominated in 
dollars could be adversely affected. To the extent that a country develops a    
trade deficit, it will need to depend on continuing loans from foreign          
governments, multilateral organizations or private commercial banks, aid        
payments from foreign governments and on inflows of foreign investment. The     
access of a country to these forms of external funding may not be certain, and a
withdrawal of external funding could adversely affect the capacity of a         
government to make payments on its obligations. In addition, the cost of        
servicing debt obligations can be affected by a change in international interest
rates since the majority of these obligations carry interest rates that are     
adjusted periodically based upon international rates.                           

   Another factor bearing on the ability of a country to repay
Sovereign Debt Obligations is the level of the country's international reserves.
Fluctuations in the level of these reserves can affect the amount of foreign    
exchange readily available for external debt payments and, thus, could have a   
bearing on the capacity of the country to make payments in its Sovereign Debt   
Obligations.                                                                    

            A Fund is permitted to invest in Sovereign Debt Obligations that are
not current in the payment of interest or principal or are in default, so long  
as the Adviser believes it to be consistent with the Fund's investment          
objectives. A Fund may have limited legal recourse in the event of a default    
with respect to certain Sovereign Debt Obligations it holds. For example,       
remedies from defaults on certain Sovereign Debt Obligations, unlike those on   
private debt, must, in some cases, be pursued in the courts of the defaulting   
party itself. Legal recourse therefore may be significantly diminished.         
Bankruptcy, moratorium and other similar laws applicable to issuers of Sovereign
Debt Obligations may be substantially different from those applicable to issuers
of private debt obligations. The political context, expressed as the willingness
of an issuer of Sovereign Debt Obligations to meet the terms of the debt        
obligation, for example, is of considerable importance. In addition, no         
assurance can be given that the holders of commercial bank debt will not contest
payments to the holders of securities issued by foreign governments in the event
of default under commercial bank loan agreements.                               

--------------------------------------------------------------------------------

INVESTMENT RESTRICTIONS 

--------------------------------------------------------------------------------

Fundamental Investment Policies                                                 
-------------------------------                                                 

         Each Fund has adopted the following investment restrictions which
may not be changed without approval of the vote of a majority of a Fund's       
outstanding voting securities. The term "majority of outstanding securities"    
means the affirmative vote of the holders of (i) 67% or more of the shares of   
the Fund represented at a meeting at which more than 50% of the outstanding     
shares are present in person or by proxy or (ii) more than 50% of the           
outstanding shares of the Fund, whichever is less.                              

As a matter of fundamental policy, a Fund:              

(a)   may not concentrate investments in an industry, as
                concentration may be defined under the 1940 Act or the rules
         and regulations thereunder (as such statute, rules or
                regulations may be amended from time to time) or by guidance
                 regarding, interpretations of, or exemptive orders under, the
                1940 Act or the rules or regulations thereunder published by
appropriate regulatory authorities;         

           (b)   may not issue any senior security (as that term is defined in
                 the 1940 Act) or borrow money, except to the extent permitted
               by the 1940 Act or the rules and regulations thereunder (as
                  such statute, rules or regulations may be amended from time to
             time) or by guidance regarding, or interpretations of, or
        exemptive orders under, the 1940 Act or the rules or
              regulations thereunder published by appropriate regulatory
                 authorities. For the purposes of this restriction, margin and
                 collateral arrangements, including, for example, with respect
                to permitted borrowings, options, futures contracts, options
                 on futures contracts and other derivatives such as swaps, are
       not deemed to be the issuance of a senior security;

        (c)   may not make loans except through (i) the purchase of debt
               obligations in accordance with its investment objective and
                 policies; (ii) the lending of portfolio securities; (iii) the
                use of repurchase agreements; or (iv) the making of loans to
               affiliated funds as permitted under the 1940 Act, the rules
         and regulations thereunder (as such statutes, rule or
                 regulations may be amended from time to time), or by guidance
                 regarding, and interpretations of, or exemptive orders under,
the 1940 Act;                               

     (d)   may not purchase or sell real estate except that it may
                dispose of real estate acquired as a result of the ownership
                 of securities or other instruments. This restriction does not
           prohibit the Fund from investing in securities or other
         instruments backed by real estate or in securities of
  companies engaged in the real estate business;

           (e)   with respect to High Income and Global Bond, may not purchase
                 or sell commodities regulated by the CFTC under the Commodity
            Exchange Act or commodities contracts except for futures
                 contracts and options on futures contracts, and, with respect
                to Intermediate Bond and Unconstrained Bond, may purchase or
                  sell commodities or options thereon to the extent permitted by
applicable law; or                          

          (f)   may not act as an underwriter of securities, except that the
                 Fund may acquire restricted securities under circumstances in
                 which, if such securities were sold, the Fund might be deemed
            to be an underwriter for purposes of the Securities Act.

     As a matter of fundamental policy, each of Intermediate Bond,
Unconstrained Bond and High Income is diversified (as that term is defined in   
the 1940 Act). This means that at least 75% of the Fund's assets consist of:    

o     Cash or cash items;                                           
o     Government securities;                                        
o     Securities of other investment companies; and                 
      o     Securities of any one issuer that represent not more than 10% of the
         outstanding voting securities of the issuer of the securities and
not more than 5% of the total assets of the Fund.       

As a matter of fundamental policy, Global Bond is a     
"non-diversified" investment company, which means the Fund is not limited in the
proportion of its assets that may be invested in the securities of a single     
issuer. This policy may be changed without a shareholder vote. However, the Fund
intends to limit its investments so as to qualify to be taxed as a "regulated   
investment company" for purposes of the Internal Revenue Code of 1986, as       
amended (the "Code"), which will relieve the Fund of any liability for federal  
income tax to the extent its earnings are distributed to shareholders. See      
"Dividends, Distributions and Taxes." To so qualify, among other requirements,  
the Fund will limit its investment so that, at the close of each quarter of the 
taxable year, (i) not more than 25% of the Fund's total assets will be invested 
in the securities of a single issuer, and (ii) with respect to 50% of its total 
assets, not more than 5% of its total assets will be invested in the securities 
of a single issuer and the Fund will not own more than 10% of the outstanding   
voting securities of a single issuer. A Fund's investments in U.S. Government   
securities are not subject to these limitations.                                

           Because Global Bond is a non-diversified investment company, it may
invest in a smaller number of individual issuers than a diversified investment  
company, and an investment in the Fund may, under certain circumstances, present
greater risk to an investor than an investment in a diversified investment      
company. Foreign government securities are not treated like U.S. Government     
securities for purposes of the diversification tests described in the preceding 
paragraph, but instead are subject to these tests in the same manner as the     
securities of non-governmental issuers. In this regard sovereign debt           
obligations issued by different issuers located in the same country are often   
treated as issued by a single issuer for purposes of these diversification      
tests. Certain issuers of structured securities and loan participations may be  
treated as separate issuers for the purposes of these tests.                    

Non-Fundamental Investment Policies                                             
-----------------------------------                                             

      As a matter of non-fundamental policy, each Fund has adopted a
policy that provides that the Fund may not purchase securities on margin, except
(i) as otherwise provided under rules adopted by the Commission under the 1940  
Act or by guidance regarding the 1940 Act, or interpretations thereof, and (ii) 
that the Fund may obtain such short-term credits as are necessary for the       
clearance of portfolio transactions, and the Fund may make margin payments in   
connection with futures contracts, options, forward contracts, swaps, caps,     
floors, collars and other financial instruments.                                

--------------------------------------------------------------------------------

MANAGEMENT OF THE FUNDS 

--------------------------------------------------------------------------------

The Adviser                                                                     
-----------                                                                     

          The Adviser, a Delaware limited partnership with principal offices
at 1345 Avenue of the Americas, New York, New York 10105, has been retained     
under an investment advisory agreement (the "Advisory Agreement") to provide    
investment advice and, in general, to conduct the management and investment     
program of each of the Funds under the supervision of each Fund's Board (see    
"Management of the Funds" in the Prospectuses). The Adviser is an investment    
adviser registered under the Investment Advisers Act of 1940, as amended.       

  The Adviser is a leading global investment management firm
supervising client accounts with assets as of September 30, 2010, totaling      
approximately $484 billion. The Adviser provides management services for many of
the largest U.S. public and private employee benefit plans, endowments,         
foundations, public employee retirement funds, banks, insurance companies and   
high net worth individuals worldwide. The Adviser is also one of the largest    
mutual fund sponsors, with a diverse family of globally distributed mutual fund 
portfolios. As one of the world's leading global investment management          
organizations, the Adviser is able to compete for virtually any portfolio       
assignment in any developed capital market in the world.                        

            As of September 30, 2010, AXA, a societe anonyme organized under the
laws of France and the holding company for an international group of insurance  
and related financial services companies, through certain of its subsidiaries   
("AXA and its subsidiaries") owned approximately 1.4% of the issued and         
outstanding assignments of beneficial ownership of limited partnership interests
("Holding Units") in AllianceBernstein Holding L.P., a Delaware limited         
partnership ("Holding"). Holding Units trade publicly on the Exchange under the 
ticker symbol "AB."                                                             

         As of September 30, 2010, the ownership structure of the Adviser,
expressed as a percentage of general and limited partnership interests, was as  
follows:                                                                        

AXA and its subsidiaries            61.4%   
Holding                             36.7    
Unaffiliated holders                 1.9    
                                ------------
                                100.0%
                                ============

          AllianceBernstein Corporation (an indirect wholly-owned subsidiary
of AXA) is the general partner of both Holding and the Adviser.                 
AllianceBernstein Corporation owns 100,000 general partnership units in Holding 
and a 1% general partnership interest in the Adviser. Including both the general
partnership and limited partnership interests in Holding and the Adviser, AXA   
and its subsidiaries had an approximate 63.0% economic interest in the Adviser  
as of September 30, 2010.                                                       

          AXA, a French company, is the holding company for an international
group of companies and a worldwide leader in financial protection and wealth    
management. AXA operates primarily in Western Europe, North America and the     
Asia/Pacific region and, to a lesser extent, in other regions including the     
Middle East, Africa and South America. AXA has five operating business segments:
life and savings, property and casualty insurance, international insurance      
(including reinsurance), asset management and other financial services. AXA     
Financial, Inc. is a wholly-owned subsidiary of AXA. AXA Equitable is an        
indirect wholly-owned subsidiary of AXA Financial.                              

Advisory Agreement and Expenses                                                 
-------------------------------                                                 

           The Adviser serves as investment manager and adviser of each of the
Funds, continuously furnishes an investment program for each Fund, and manages, 
supervises and conducts the affairs of each Fund, subject to supervision of each
Fund's Board.                                                                   

          Under the Advisory Agreements for Intermediate Bond, Unconstrained
Bond, High Income, and Global Bond, the Adviser furnishes advice and            
recommendations with respect to the Funds' portfolio of securities and          
investments and provides persons satisfactory to the Board to act as officers of
the Funds. Such officers and employees may be employees of the Adviser or its   
affiliates.                                                                     

         The Adviser is, under each Fund's Advisory Agreement, responsible
for certain expenses incurred by the Fund, including, for example, office       
facilities and certain administrative services, and any expenses incurred in    
promoting the sale of Fund shares (other than the portion of the promotional    
expenses borne by the Fund in accordance with an effective plan pursuant to Rule
12b-1 under the 1940 Act, and the costs of printing Fund prospectuses and other 
reports to shareholders and fees related to registration with the Commission and
with state regulatory authorities).                                             

           The Advisory Agreements are terminable without penalty by a vote of
a majority of the Funds' outstanding voting securities or by a vote of a        
majority of the Directors on 60 days' written notice or by the Adviser on 60    
days' written notice, and will automatically terminate in the event of          
assignment. Each Advisory Agreement provides that in the absence of willful     
misfeasance, bad faith or gross negligence on the part of the Adviser, or of    
reckless disregard of its obligations thereunder, the Adviser shall not be      
liable for any action or failure to act in accordance with its duties           
thereunder.                                                                     

ALLIANCEBERNSTEIN INTERMEDIATE BOND PORTFOLIO                                   

          For services rendered by the Adviser under the Advisory Agreement,
the Fund paid the Adviser a fee effective September 7, 2004 of .45 of 1% of the 
first $2.5 billion of the Fund's average net assets and .40 of 1% of the excess 
of $2.5 billion up to 5 billion and .35 of 1% of the excess over $5 billion as a
percentage of aggregate daily net assets (for the year 2004, the Fund's         
previously effective advisory fee was waived to this amount by the Adviser after
January 1, 2004). The fee is accrued daily and paid monthly. The Adviser has    
contractually agreed through the Fund's fiscal year ending October 31, 2011 to  
waive its fee and bear certain expenses so that total operating expenses,       
excluding interest expense, do not exceed on an annual basis .85%, 1.55%, 1.55%,
1.05%, .80%, .55% and .55% of aggregate average net assets, respectively, for   
Class A, Class B, Class C, Class R, Class K, Class I and Advisor Class shares.  
This contractual agreement automatically extends each year unless the Adviser   
provides the Fund written notice 60 days prior to the Fund's fiscal year end.   

      For the fiscal years ended October 31, 2008, 2009 and 2010 the
Adviser received under the Advisory Agreement the amount of $2,586,786,         
$2,334,733 and $2,592,080 respectively, as advisory fees from the Fund. Under   
the expense limitation undertaking, $1,313,293, $1,136,115 and $1,181,888 were  
waived and/or reimbursed by the Adviser for the fiscal years ended October 31,  
2008, 2009 and 2010, respectively.                                              

          The Fund has, under the Advisory Agreement, assumed the obligation
for payment of all of its other expenses. As to the obtaining of services other 
than those specifically provided to the Fund by the Adviser, the Fund may employ
its own personnel. For such services it may also utilize personnel employed by  
the Adviser or its affiliates and, in such event, the services will be provided 
to the Fund at cost and the payments therefore must be specifically approved by 
the Fund's Board. For the fiscal year ended October 31, 2010, the cost of       
certain legal and accounting services amounting to $82,651 provided to the Fund 
by the Adviser was waived.                                                      

           The Advisory Agreement became effective with respect to the Fund on
July 1, 1999.                                                                   

     The Advisory Agreement continues in effect provided that such
continuance is specifically approved at least annually by a vote of a majority  
of the Fund's outstanding voting securities or by the Fund's Board, and in      
either case, by a majority of the Directors who are not parties to the Advisory 
Agreement or interested persons of any such party. Most recently, continuance of
the Advisory Agreement for an additional annual term was approved by vote, cast 
in person, by the Board, including a majority of the Directors who are not      
"interested persons" as defined in the 1940 Act, at their meetings held on      
November 2-4, 2010.                                                             

ALLIANCEBERNSTEIN UNCONSTRAINED BOND FUND, INC.                                 

   For the services rendered by the Adviser under the Advisory
Agreement, the Fund paid the Adviser effective September 7, 2004 a fee at the   
annual rate of .50 of 1% for the first $2.5 billion, .45 of 1% of the excess of 
$2.5 billion up to $5 billion and .40 of 1% of the excess over $5 billion as a  
percentage of the Fund's average daily net assets (for the year 2004, the Fund's
previously effective advisory fee rate was waived to this amount after January  
1, 2004). The fee is accrued daily and paid monthly. The Adviser has            
contractually agreed through the Fund's fiscal year ending October 31, 2011 to  
waive its fee and bear certain expenses so that total expenses do not exceed on 
an annual basis .90%, 1.60%, 1.60%, .60%, 1.10%, .85%, and .60% of aggregate    
daily net assets, respectively, for Class A, Class B, Class C, Advisor Class,   
Class R, Class K, and Class I shares. This contractual agreement automatically  
extends each year unless the Adviser provides written notice 60 days prior to   
the Fund's fiscal year end.                                                     

       For the fiscal years ended October 31, 2008, 2009 and 2010, the
Adviser received from the Fund advisory fees of $455,521, $331,772 and $374,781,
respectively. Under the expense limitation undertaking, $489,151 was waived     
and/or reimbursed by the Adviser for the fiscal year ended 2010.                

          The Fund has, under the Advisory Agreement, assumed the obligation
for payment of all of its other expenses. As to the obtaining of services other 
than those specifically provided to the Fund by the Adviser, the Fund may employ
its own personnel. For such services, it may also utilize personnel employed by 
the Adviser or its affiliates and, in such event, the services will be provided 
to the Fund at cost and the payments will be specifically approved by the Fund's
Board. For the fiscal year ended October 31, 2010, the Fund paid to the Adviser 
a total of $88,288 with respect to such services.                               

   The Advisory Agreement became effective on January 2, 1996.

         The Advisory Agreement will continue in effect provided that such
continuance is specifically approved at least annually by a vote of a majority  
of the Fund's outstanding voting securities or by the Fund's Board, including in
either case approval by a majority of the Directors who are not parties to the  
Advisory Agreement or "interested persons," as defined by the 1940 Act, of any  
such party. Most recently, the Advisory Agreement was approved for an additional
annual term by the Board, including majority of the Directors who are not       
parties to the Advisory Agreement or interested periods of any such party, at   
their meetings held on November 2-4, 2010.                                      

ALLIANCEBERNSTEIN GLOBAL BOND FUND, INC.                                        

   For the services rendered by the Adviser under the Advisory
Agreement, the Fund paid the Adviser a fee effective September 7, 2004 at an    
annual rate of .50 of 1% for the first $2.5 billion, .45 of 1% of the excess of 
$2.5 billion up to $5 billion and .40 of 1% of the excess over $5 billion up to 
$5 billion as a percentage of the Fund's average daily net assets (for the year 
2004, the Fund's previously effective advisory fee rate was waived to this      
amount after January 1, 2004). The fee is accrued daily and paid monthly. The   
Adviser has contractually agreed through the Fund's fiscal year ending September
30, 2011 to waive its fee and bear certain expenses so that total operating     
expenses, excluding interest expense, do not exceed on an annual basis .90%,    
1.60%, 1.60%, .60%, 1.10%, .85%, and .60% of aggregate daily net assets,        
respectively, for Class A, Class B, Class C, Advisor Class, Class R, Class K,   
and Class I shares. This contractual agreement automatically extends each year  
unless the Adviser provides written notice 60 days prior to the Fund's fiscal   
year end. For the fiscal years of the Fund ended September 30, 2008, 2009 and   
2010, the Adviser received from the Fund advisory fees of $10,057,085,          
$9,417,000 and $12,980,904. Under the expense limitation undertaking $1,347,642 
was waived and/or reimbursed by the Adviser for the fiscal year ended 2010.     

          The Fund has, under the Advisory Agreement, assumed the obligation
for payment of all of its other expenses. As to the obtaining of services other 
than those specifically provided to the Fund by the Adviser, the Fund may employ
its own personnel. For such services it may also utilize personnel employed by  
the Adviser or its affiliates and, in such event, the services will be provided 
to the Fund at cost and the payments will be specifically approved by the Fund's
Board. During the Fund's fiscal year ended September 30, 2010, the Fund paid to 
the Adviser a total of $85,510 with respect to such services.                   

 The Advisory Agreement became effective on July 22, 1992.

     The Advisory Agreement continues in effect provided that such
continuance is specifically approved at least annually by the Fund's Directors  
or by a majority vote of the holders of the outstanding voting securities of the
Fund, and, in either case, by a majority of the Directors who are not parties to
the Advisory Agreement or "interested persons" as defined in the 1940 Act of any
such party. Most recently the Advisory Agreement was approved for an additional 
annual term by a vote, cast in person, of the Directors, including a majority of
the Directors who are not parties to the Advisory Agreement or interested       
persons of any such party, at their meetings held on November 2-4, 2010.        

ALLIANCEBERNSTEIN HIGH INCOME FUND, INC.                                        

   For the services rendered by the Adviser under the Advisory
Agreement, the Fund paid the Adviser a fee effective September 7, 2004 at an    
annual rate of .50 of 1% for the first $2.5 billion, .45 of 1% of the excess of 
$2.5 billion up to $5 billion, and .40 of 1% of the excess over $5 billion of   
the Fund's average daily net assets (for the year 2004, the Fund's previously   
effective advisory fee was waived to this amount after January 1, 2004). The fee
is accrued daily and paid monthly. The Adviser has contractually agreed through 
the Fund's fiscal year ending October 31, 2011 to waive its fee and bear certain
expenses so that total operating expenses, excluding interest expense, do not   
exceed on an annual basis .95%, 1.65%, 1.65%, .65%, 1.15%, .90%, and .65% of    
aggregate daily net assets, respectively, for Class A, Class B, Class C, Advisor
Class, Class R, Class K, and Class I shares. This contractual agreement         
automatically extends each year unless the Adviser provides written notice 60   
days prior to the Fund's fiscal year end. For the fiscal years ended October 31,
2008, 2009 and 2010, the Adviser received from the Fund advisory fees of        
$4,026,514, $3,771,257 and $7,787,382, respectively. Under the expense          
limitation undertaking $736,252 was waived and/or reimbursed by the Adviser for 
the fiscal year ended 2010.                                                     

          The Fund has, under the Advisory Agreement, assumed the obligation
for payment of all of its other expenses. As to the obtaining of services other 
than those specifically provided to the Fund by the Adviser, the Fund may employ
its own personnel. For such services, it may also utilize personnel employed by 
the Adviser or its affiliates and, in such event, the services will be provided 
to the Fund at cost and the payments will be specifically approved by the Fund's
Board. The Fund paid to the Adviser a total of $89,160 in respect of such       
services during the Fund's fiscal year ended October 31, 2010.                  

    The Advisory Agreement became effective on February 1, 1994.

     The Advisory Agreement continues in effect provided that such
continuance is approved at least annually by a vote of a majority of the Fund's 
outstanding voting securities or by the Fund's Board, including in either case, 
approval by a majority of the Directors who are not parties to the Advisory     
Agreement or interested persons of any such party as defined by the Act. Most   
recently, continuance of the Advisory Agreement was approved for an additional  
annual term by the Board, including a majority of the Directors who are not     
"interested persons" as defined in the 1940 Act, at their meetings held on      
November 2-4, 2010.                                                             

        The Adviser may act as an investment adviser to other persons, firms
or corporations, including investment companies, and is the investment adviser  
to the following registered investment companies: AllianceBernstein Balanced    
Shares, Inc., AllianceBernstein Blended Style Series, Inc., AllianceBernstein   
Cap Fund, Inc., AllianceBernstein Corporate Shares, AllianceBernstein Core      
Opportunities Fund, Inc., AllianceBernstein Equity Income Fund, Inc.,           
AllianceBernstein Exchange Reserves, AllianceBernstein Fixed-Income Shares,     
Inc., AllianceBernstein Global Bond Fund, Inc., AllianceBernstein Global Growth 
Fund, Inc., AllianceBernstein Global Real Estate Investment Fund, Inc.,         
AllianceBernstein Global Thematic Growth Fund, Inc., AllianceBernstein Greater  
China '97 Fund, Inc., AllianceBernstein Growth and Income Fund, Inc.,           
AllianceBernstein High Income Fund, Inc., AllianceBernstein Institutional Funds,
Inc., AllianceBernstein International Growth Fund, Inc., AllianceBernstein Large
Cap Growth Fund, Inc., AllianceBernstein Municipal Income Fund, Inc.,           
AllianceBernstein Municipal Income Fund II, AllianceBernstein Small/Mid Cap     
Growth Fund, Inc., AllianceBernstein Trust, AllianceBernstein Unconstrained Bond
Fund, Inc., AllianceBernstein Variable Products Series Fund, Inc., Sanford C.   
Bernstein Fund, Inc., Sanford C. Bernstein Fund II, Inc., The AllianceBernstein 
Pooling Portfolios and The AllianceBernstein Portfolios, all registered open-end
investment companies; and to AllianceBernstein Global High Income Fund, Inc.,   
AllianceBernstein Income Fund, Inc., AllianceBernstein National Municipal Income
Fund, Inc., Alliance California Municipal Income Fund, Inc., Alliance New York  
Municipal Income Fund, Inc., and The Ibero-America Fund, Inc., all registered   
closed-end investment companies.                                                

Additional Information About the Funds' Portfolio Managers                      
----------------------------------------------------------                      

ALLIANCEBERNSTEIN INTERMEDIATE BOND PORTFOLIO                                   

           The management of and investment decisions for the Fund's portfolio
are made by the U.S. Investment Grade: Core Fixed Income Investment Team. Mr.   
Paul J. DeNoon, Mr. Shawn E. Keegan, Ms. Alison M. Martier and Mr. Greg J.      
Wilensky are the investment professionals(1) with the most significant          
responsibility for the day-to-day management of the Fund's portfolio. For       
additional information about the portfolio management of the Fund, see          
"Management of the Fund - Fund Managers" in the Fund's prospectuses.            

--------                                                                        
(1)   Investment professionals at the Adviser include portfolio managers and    
     research analysts. Investment professionals are part of investment groups
(or teams) that service individual fund portfolios. The number of   
      investment professionals assigned to a particular fund will vary from fund
to fund.                                                            

           The dollar ranges of the Fund's equity securities owned directly or
beneficially by the Fund's portfolio manager as of October 31, 2010 are set     
forth below:                                                                    

DOLLAR RANGE OF EQUITY SECURITIES IN THE FUND(2)
------------------------------------------------

Mr. Paul J. DeNoon                                 None             
Mr. Shawn E. Keegan                            $0 - $10,000(3)      
Ms. Alison M. Martier                              None             
Mr. Douglas J. Peebles                             None             
Mr. Greg J. Wilensky                               None             

--------                                                                        
(2)   The dollar range presented above include any vested shares awarded under  
the Adviser's Partners Compensation Plan (the "Plan").              
(3)   For information presented as of the fiscal year ended October 31, 2010,   
   with respect to Mr. Keegan, if the unvested shares awarded for calendar
      year 2010 and previous years under the Plan were included, the range would
be $10,001 - $50,000.                                               
          As of October 31, 2010, employees of the Adviser had approximately
$7,290,416 invested in shares of the Fund and approximately $408,512,031        
invested in shares of all AllianceBernstein Mutual Funds (excluding             
AllianceBernstein money market funds) through their interests in certain        
deferred compensation plans, including the Partners Compensation Plan, including
both vested and unvested amounts.                                               

     The following tables provide information regarding registered
investment companies other than the Fund, other pooled investment vehicles and  
other accounts over which the Fund's portfolio managers also have day-to-day    
management responsibilities. The tables provide the numbers of such accounts,   
the total assets in such accounts and the number of accounts and total assets   
whose fees are based on performance. The information is provided as of October  
31, 2010.                                                                       
--------------------------------------------------------------------------------
REGISTERED INVESTMENT COMPANIES 
(excluding the Fund)
--------------------------------------------------------------------------------
                                                       Total
                                             Number of     Assets of
                   Total       Total          Registered    Registered
                   Number of   Assets of      Investment    Investment
                  Registered  Registered     Companies     Companies
                     Investment  Investment     Managed with  Managed with
                     Companies   Companies      Performance-  Performance-
Portfolio Manager       Managed     Managed        based Fees    based Fees     
--------------------------------------------------------------------------------
Mr. Paul J. DeNoon            91    $22,563,000,000       90     $22,563,000,000
Mr. Shawn E. Keegan           46     $9,959,000,000       46      $9,559,000,000
Ms. Alison M. Martier         45     $9,691,000,000       45      $9,691,000,000
Mr. Douglas J. Peebles       123    $25,565,000,000      122     $25,565,000,000
Mr. Greg J. Wilensky         108    $12,840,000,000      107     $12,840,000,000

--------------------------------------------------------------------------------

OTHER POOLED INVESTMENT VEHICLES
--------------------------------------------------------------------------------
                                         Number of     Total
                Total                        Other         Assets of
                   Number of                    Pooled        Other Pooled
                 Other       Total Assets of  Investment    Investment
               Pooled      Other Pooled     Vehicles      Vehicles
                   Investment  Investment       Managed with  Managed with
                   Vehicles    Vehicles         Performance-  Performance-
Portfolio Manager     Managed     Managed          based Fees    based Fees     
--------------------------------------------------------------------------------
Mr. Paul J. DeNoon        102     $32,471,000,000          97    $32,105,000,000
Mr. Shawn E. Keegan        51      $4,576,000,000          51     $4,576,000,000
Ms. Alison M. Martier      42        $250,000,000          42       $250,000,000
Mr. Douglas J. Peebles    151     $45,009,000,000         146    $44,642,000,000
Mr. Greg J. Wilensky       87      $3,012,000,000          82     $2,646,000,000

--------------------------------------------------------------------------------

OTHER ACCOUNTS
--------------------------------------------------------------------------------
                                                       Total
                                             Number of     Assets of
             Total                       Other         Other
                Number of                   Accounts      Accounts
                    Other      Total Assets of  Managed with  Managed with
                    Accounts   Other Accounts   Performance-  Performance-
Portfolio Manager      Managed    Managed          based Fees    based Fees     
--------------------------------------------------------------------------------
Mr. Paul J. DeNoon         232    $34,313,000,000         226    $31,467,000,000
Mr. Shawn E. Keegan        186    $54,710,000,000         182    $52,438,000,000
Ms. Alison M. Martier       82     $6,305,000,000          81     $6,173,000,000
Mr. Douglas J. Peebles     406    $89,804,000,000         396    $84,499,000,000
Mr. Greg J. Wilensky       179    $11,037,000,000         177    $10,215,000,000

ALLIANCEBERNSTEIN UNCONSTRAINED BOND FUND, INC.                                 

           The management of and investment decisions for the Fund's portfolio
are made by the Global Fixed Income Investment Team and the Global Credit       
Investment Team. Mr. Paul J. DeNoon, Mr. Joran Laird, Mr. Douglas J. Peebles,   
Mr. Matthew S. Sheridan and Mr. Greg J. Wilensky are the investment             
professionals(4) with the most significant responsibility for the day-to-day    
management of the Fund's portfolio. For additional information about the        
portfolio management of the Fund, see "Management of the Fund - Portfolio       
Managers" in the Fund's prospectuses.                                           

--------                                                                        
(4)   Investment professionals at the Adviser include portfolio managers and    
     research analysts. Investment professionals are part of investment groups
(or teams) that service individual fund portfolios. The number of   
      investment professionals assigned to a particular fund will vary from fund
to fund.                                                            

           The dollar ranges of the Fund's equity securities owned directly or
beneficially by the Fund's portfolio managers as of October 31, 2010 are set    
forth below:                                                                    

DOLLAR RANGE OF EQUITY SECURITIES IN THE FUND(5)

Mr. Paul J. DeNoon                              None                
Mr. Joran Laird                                 None                
Mr. Douglas J. Peebles                      Over $100,000           
Mr. Matthew S. Sheridan                         None                
Mr. Greg J. Wilensky                            None                

--------                                                                        
(5)   The dollar range presented above include any vested shares awarded under  
the Adviser's Partners Compensation Plan (the "Plan").              

        As of October 31, 2010, employees had approximately $118,940,466
invested in shares of all AllianceBernstein Mutual Funds (excluding             
AllianceBernstein money market funds) through their interests in certain        
deferred compensation plans, including the Partners Compensation Plan, including
both vested and unvested amounts.                                               

     The following tables provide information regarding registered
investment companies other than the Fund, other pooled investment vehicles and  
other accounts over which the Fund's portfolio managers also have day-to-day    
management responsibilities. The tables provide the numbers of such accounts,   
the total assets in such accounts and the number of accounts and total assets   
whose fees are based on performance. The information is provided as of October  
31, 2010.                                                                       

--------------------------------------------------------------------------------
REGISTERED INVESTMENT COMPANIES 
(excluding the Fund)
--------------------------------------------------------------------------------
                                                       Total
                                             Number of     Assets of
                   Total       Total          Registered    Registered
                   Number of   Assets of      Investment    Investment
                  Registered  Registered     Companies     Companies
                     Investment  Investment     Managed with  Managed with
                     Companies   Companies      Performance-  Performance-
Portfolio Manager       Managed     Managed        based Fees    based Fees     
--------------------------------------------------------------------------------

Mr. Paul J. DeNoon           91     $23,087,000,000      1             None     
Mr. Joran Laird              12     $10,296,000,000     None           None     
Mr. Douglas J. Peebles      123     $26,089,000,000      1             None     
Mr. Matthew S. Sheridan      13     $10,447,000,000     None           None     
Mr. Greg J. Wilensky        108     $13,364,000,000      1             None     

--------------------------------------------------------------------------------

OTHER POOLED INVESTMENT VEHICLES
--------------------------------------------------------------------------------
                                                             Total
                                                   Number of     Assets of
                  Total                        Other         Other
                   Number of                    Pooled        Pooled
                       Other       Total Assets of  Investment    Investment
                     Pooled      Other Pooled     Vehicles      Vehicles
                         Investment  Investment       Managed with  Managed with
                         Vehicles    Vehicles         Performance-  Performance-
Portfolio Manager        Managed     Managed          based Fees    based Fees  
--------------------------------------------------------------------------------

Mr. Paul J. DeNoon           102     $32,471,000,000        5       $367,000,000
Mr. Joran Laird               26     $25,973,000,000       None          None   
Mr. Douglas J. Peebles       151     $45,009,000,000        5       $367,000,000
Mr. Matthew S. Sheridan       33     $29,482,000,000       None          None   
Mr. Greg J. Wilensky          87      $3,012,000,000        5       $367,000,000

--------------------------------------------------------------------------------

OTHER ACCOUNTS
--------------------------------------------------------------------------------
                                                         Total
                                               Number of     Assets of
               Total                       Other         Other
                  Number of                   Accounts      Accounts
                      Other      Total Assets of  Managed with  Managed with
                      Accounts   Other Accounts   Performance-  Performance-
Portfolio Manager       Managed    Managed          based Fees    based Fees    
--------------------------------------------------------------------------------

Mr. Paul J. DeNoon          232    $34,313,000,000         6      $2,846,000,000
Mr. Joran Laird              49    $16,774,000,000         4      $2,025,000,000
Mr. Douglas J. Peebles      406    $89,804,000,000        10      $5,305,000,000
Mr. Matthew S. Sheridan      54    $23,288,000,000         4      $2,025,000,000
Mr. Greg J. Wilensky        179    $11,037,000,000         2        $822,000,000

ALLIANCEBERNSTEIN GLOBAL BOND FUND, INC.                                        

           The management of and investment decisions for the Fund's portfolio
are made by the Global Fixed Income Investment Team. Mr. Paul J. DeNoon, Mr.    
Scott DiMaggio, Mr. Michael L. Mon, Mr. Douglas J. Peebles and Mr. Matthew S.   
Sheridan are the investment professionals(6) with the most significant          
responsibility for the day-to-day management of the Fund's portfolio. For       
additional information about the portfolio management of the Fund, see          
"Management of the Fund - Portfolio Managers" in the Fund's prospectuses.       

--------                                                                        
(6)   Investment professionals at the Adviser include portfolio managers and    
     research analysts. Investment professionals are part of investment groups
(or teams) that service individual fund portfolios. The number of   
      investment professionals assigned to a particular fund will vary from fund
to fund.                                                            

           The dollar ranges of the Fund's equity securities owned directly or
beneficially by the Fund's portfolio managers as of September 30, 2010 are set  
forth below:                                                                    

DOLLAR RANGE OF EQUITY SECURITIES IN THE FUND(7)

Mr. Paul J. DeNoon                             None                 
Mr. Scott DiMaggio                             None                 
Mr. Michael L. Mon                             None                 
Mr. Douglas J. Peebles                         None                 
Mr. Matthew S. Sheridan                        None                 

--------                                                                        
(7)   The dollar range presented above include any vested shares awarded under  
the Adviser's Partners Compensation Plan (the "Plan").              

            As of September 30, 2010, employees of the Adviser had approximately
$398,751,432 invested in shares of all AllianceBernstein Mutual Funds (excluding
AllianceBernstein money market funds) through their interests in certain        
deferred compensation plans, including the Partners Compensation Plan, including
both vested and unvested amounts.                                               

     The following tables provide information regarding registered
investment companies other than the Fund, other pooled investment vehicles and  
other accounts over which the Fund's portfolio managers also have day-to-day    
management responsibilities. The tables provide the numbers of such accounts,   
the total assets in such accounts and the number of accounts and total assets   
whose fees are based on performance. The information is provided as of September
30, 2010.                                                                       
--------------------------------------------------------------------------------
REGISTERED INVESTMENT COMPANIES 
(excluding the Fund)
--------------------------------------------------------------------------------
                                                           Total
                                                 Number of     Assets of
                     Total       Total            Registered    Registered
                     Number of   Assets of        Investment    Investment
                    Registered  Registered       Companies     Companies
                       Investment  Investment       Managed with  Managed with
                       Companies   Companies        Performance-  Performance-
Portfolio Manager       Managed     Managed          based Fees    based Fees   
--------------------------------------------------------------------------------
Mr. Paul J. DeNoon           91     $20,366,000,000        1           None     
Mr. Scott DiMaggio           14     $8,880,000,000       None          None     
Mr. Michael L. Mon           12     $7,145,000,000       None          None     
Mr. Douglas J. Peebles      139     $23,835,000,000        1           None     
Mr. Matthew S. Sheridan      12     $7,145,000,000       None          None     

--------------------------------------------------------------------------------

OTHER POOLED INVESTMENT VEHICLES
--------------------------------------------------------------------------------
                                                             Total
                                                   Number of     Assets of
                  Total                        Other         Other
                   Number of                    Pooled        Pooled
                       Other       Total Assets of  Investment    Investment
                     Pooled      Other Pooled     Vehicles      Vehicles
                         Investment  Investment       Managed with  Managed with
                         Vehicles    Vehicles         Performance-  Performance-
Portfolio Manager        Managed     Managed          based Fees    based Fees  
--------------------------------------------------------------------------------
Mr. Paul J. DeNoon           101     $31,876,000,000         5      $366,000,000
Mr. Scott DiMaggio            29     $25,714,000,000        None        None    
Mr. Michael L. Mon            34     $28,885,000,000        None        None    
Mr. Douglas J. Peebles       150     $43,980,000,000         5      $366,000,000
Mr. Matthew S. Sheridan       34     $28,885,000,000        None        None    

--------------------------------------------------------------------------------

OTHER ACCOUNTS
--------------------------------------------------------------------------------
                                                         Total
                                               Number of     Assets of
               Total                       Other         Other
                  Number of                   Accounts      Accounts
                      Other      Total Assets of  Managed with  Managed with
                      Accounts   Other Accounts   Performance-  Performance-
Portfolio Manager       Managed    Managed          based Fees    based Fees    
--------------------------------------------------------------------------------
Mr. Paul J. DeNoon          233    $34,296,000,000         6      $2,810,000,000
Mr. Scott DiMaggio           84    $20,640,000,000         4      $1,996,000,000
Mr. Michael L. Mon           53    $22,616,000,000         4      $1,996,000,000
Mr. Douglas J. Peebles    1,891    $91,278,000,000        10      $5,267,000,000
Mr. Matthew S. Sheridan      53    $22,616,000,000         4      $1,996,000,000

ALLIANCEBERNSTEIN HIGH INCOME FUND, INC.                                        

           The management of and investment decisions for the Fund's portfolio
are made by the Global Fixed Income Team and Global Credit Investment Team. Mr. 
Paul DeNoon, Mr. Gershon Distenfeld, Mr. Douglas Peebles, Mr. Marco Santamaria  
and Mr. Matthew Sheridan are the investment professionals(8) with the most      
significant responsibility for the day-to-day management of the Fund's          
portfolio. For additional information about the portfolio management of the     
Fund, see "Management of the Fund - Portfolio Managers" in the Fund's           
prospectus.                                                                     

--------                                                                        
(8)   Investment professionals at the Adviser include portfolio managers and    
     research analysts. Investment professionals are part of investment groups
(or teams) that service individual fund portfolios. The number of   
      investment professionals assigned to a particular fund will vary from fund
to fund.                                                            

           The dollar ranges of the Fund's equity securities owned directly or
beneficially by the Fund's portfolio managers as of October 31, 2010 are set    
forth below:                                                                    

DOLLAR RANGE OF EQUITY SECURITIES IN THE FUND(9)

Mr. Paul J. DeNoon                             None(10)             
Mr. Gershon Distenfeld                         None                 
Mr. Douglas J. Peebles                         None(11)             
Mr. Marco Santamaria                           None                 
Mr. Matthew S. Sheridan                        None                 

--------                                                                        
(9)   The dollar range presented above include any vested shares awarded under  
the Adviser's Partners Compensation Plan (the "Plan").              

(10)  For information presented as of the fiscal year ended October 31, 2010,   
   with respect to Mr. DeNoon, if the unvested shares awarded for calendar
      year 2010 and previous years under the Plan were included, the range would
be $500,001-$1,000,000.                                             

(11)  For information presented as of the fiscal year ended October 31, 2010,   
    with respect to Mr. Peebles, if the unvested shares awarded for calendar
      year 2010 and previous years under the Plan were included, the range would
be $100,001-$500,000.                                               

          As of October 31, 2010, employees of the Adviser had approximately
$12,754,298 invested in shares of the Fund and approximately $408,512,031       
invested in shares of all AllianceBernstein Mutual Funds (excluding             
AllianceBernstein money market funds) through their interests in certain        
deferred compensation plans, including the Partners Compensation Plan, including
both vested and unvested amounts.                                               

     The following tables provide information regarding registered
investment companies other than the Fund, other pooled investment vehicles and  
other accounts over which the Fund's portfolio managers also has day-to-day     
management responsibilities. The tables provide the numbers of such accounts,   
the total assets in such accounts and the number of accounts and total assets   
whose fees are based on performance. The information is provided as of October  
31, 2010.                                                                       
--------------------------------------------------------------------------------
REGISTERED INVESTMENT COMPANIES 
(excluding the Fund)
--------------------------------------------------------------------------------
                                                             Total
                                                   Number of     Assets of
                      Total       Total             Registered    Registered
                      Number of   Assets of         Investment    Investment
                     Registered  Registered        Companies     Companies
                        Investment  Investment        Managed with  Managed with
                        Companies   Companies         Performance-  Performance-
Portfolio Manager       Managed     Managed           based Fees    based Fees  
--------------------------------------------------------------------------------
Mr. Paul J. DeNoon           91     $20,843,000,000         1           None    
Mr. Gershon Distenfeld       30      $2,703,000,000        None         None    
Mr. Douglas J. Peebles      123     $23,845,000,000         1           None    
Mr. Marco Santamaria          1        $152,000,000        None         None    
Mr. Matthew S. Sheridan      12      $8,130,000,000        None         None    

--------------------------------------------------------------------------------

OTHER POOLED INVESTMENT VEHICLES
--------------------------------------------------------------------------------
                                                             Total
                                                   Number of     Assets of
                  Total                        Other         Other
                   Number of                    Pooled        Pooled
                       Other       Total Assets of  Investment    Investment
                     Pooled      Other Pooled     Vehicles      Vehicles
                         Investment  Investment       Managed with  Managed with
                         Vehicles    Vehicles         Performance-  Performance-
Portfolio Manager        Managed     Managed          based Fees    based Fees  
--------------------------------------------------------------------------------
Mr. Paul J. DeNoon           102     $32,471,000,000         5      $367,000,000
Mr. Gershon Distenfeld        44      $4,881,000,000       None         None    
Mr. Douglas J. Peebles       151     $45,009,000,000         5      $367,000,000
Mr. Marco Santamaria           7      $3,509,000,000       None         None    
Mr. Matthew S. Sheridan       33     $29,482,000,000       None         None    

--------------------------------------------------------------------------------

OTHER ACCOUNTS
--------------------------------------------------------------------------------
                                                         Total
                                               Number of     Assets of
               Total                       Other         Other
                  Number of                   Accounts      Accounts
                      Other      Total Assets of  Managed with  Managed with
                      Accounts   Other Accounts   Performance-  Performance-
Portfolio Manager       Managed    Managed          based Fees    based Fees    
--------------------------------------------------------------------------------
Mr. Paul J. DeNoon          232    $34,313,000,000        6       $2,846,000,000
Mr. Gershon Distenfeld      141    $52,931,000,000        3       $2,140,000,000
Mr. Douglas J. Peebles      406    $89,804,000,000       10       $5,305,000,000
Mr. Marco Santamaria          5     $6,513,000,000      None           None     
Mr. Matthew S. Sheridan      54    $23,288,000,000        4       $2,025,000,000

Investment Professional Conflict of Interest Disclosure                         
-------------------------------------------------------                         

            As an investment adviser and fiduciary, the Adviser owes its clients
and shareholders an undivided duty of loyalty. We recognize that conflicts of   
interest are inherent in our business and accordingly have developed policies   
and procedures (including oversight monitoring) reasonably designed to detect,  
manage and mitigate the effects of actual or potential conflicts of interest in 
the area of employee personal trading, managing multiple accounts for multiple  
clients, including AllianceBernstein Mutual Funds, and allocating investment    
opportunities. Investment professionals, including portfolio managers and       
research analysts, are subject to the above-mentioned policies and oversight    
monitoring to ensure that all clients are treated equitably. We place the       
interests of our clients first and expect all of our employees to meet their    
fiduciary duties.                                                               

    Employee Personal Trading. The Adviser has adopted a Code of
Business Conduct and Ethics that is designed to detect and prevent conflicts of 
interest when investment professionals and other personnel of the Adviser own,  
buy or sell securities which may be owned by, or bought or sold for, clients.   
Personal securities transactions by an employee may raise a potential conflict  
of interest when an employee owns or trades in a security that is owned or      
considered for purchase or sale by a client, or recommended for purchase or sale
by an employee to a client. Subject to the reporting requirements and other     
limitations of its Code of Business Conduct and Ethics, the Adviser permits its 
employees to engage in personal securities transactions, and also allows them to
acquire investments in the AllianceBernstein Mutual Funds through direct        
purchase and/or notionally in connection with deferred incentive compensation   
awards. The Adviser's Code of Ethics and Business Conduct requires disclosure of
all personal accounts and maintenance of brokerage accounts with designated     
broker-dealers approved by the Adviser. The Code also requires preclearance of  
all securities transactions (except transactions in open-end mutual funds) and  
imposes a 90-day holding period for securities purchased by employees to        
discourage short-term trading.                                                  

        Managing Multiple Accounts for Multiple Clients. The Adviser has
compliance policies and oversight monitoring in place to address conflicts of   
interest relating to the management of multiple accounts for multiple clients.  
Conflicts of interest may arise when an investment professional has             
responsibilities for the investments of more than one account because the       
investment professional may be unable to devote equal time and attention to each
account. The investment professional or investment professional teams for each  
client may have responsibilities for managing all or a portion of the           
investments of multiple accounts with a common investment strategy, including   
other registered investment companies, unregistered investment vehicles, such as
hedge funds, pension plans, separate accounts, collective trusts and charitable 
foundations. Among other things, the Adviser's policies and procedures provide  
for the prompt dissemination to investment professionals of initial or changed  
investment recommendations by analysts so that investment professionals are     
better able to develop investment strategies for all accounts they manage. In   
addition, investment decisions by investment professionals are reviewed for the 
purpose of maintaining uniformity among similar accounts and ensuring that      
accounts are treated equitably. No investment professional that manages client  
accounts carrying performance fees is compensated directly or specifically for  
the performance of those accounts. Investment professional compensation reflects
a broad contribution in multiple dimensions to long-term investment success for 
our clients and is not tied specifically to the performance of any particular   
client's account, nor is it directly tied to the level or change in level of    
assets under management.                                                        

         Allocating Investment Opportunities. The Adviser has policies and
procedures intended to address conflicts of interest relating to the allocation 
of investment opportunities. These policies and procedures are designed to      
ensure that information relevant to investment decisions is disseminated        
promptly within its portfolio management teams and investment opportunities are 
allocated equitably among different clients. The investment professionals at the
Adviser routinely are required to select and allocate investment opportunities  
among accounts. Portfolio holdings, position sizes, and industry and sector     
exposures tend to be similar across similar accounts, which minimizes the       
potential for conflicts of interest relating to the allocation of investment    
opportunities. Nevertheless, investment opportunities may be allocated          
differently among accounts due to the particular characteristics of an account, 
such as size of the account, cash position, tax status, risk tolerance and      
investment restrictions or for other reasons.                                   

       The Adviser's procedures are also designed to address potential
conflicts of interest that may arise when the Adviser has a particular financial
incentive, such as a performance-based management fee, relating to an account.  
An investment professional may perceive that he or she has an incentive to      
devote more time to developing and analyzing investment strategies and          
opportunities or allocating securities preferentially to accounts for which the 
Adviser could share in investment gains.                                        

          To address these conflicts of interest, the Adviser's policies and
procedures require, among other things, the prompt dissemination to investment  
professionals of any initial or changed investment recommendations by analysts; 
the aggregation of orders to facilitate best execution for all accounts; price  
averaging for all aggregated orders; objective allocation for limited investment
opportunities (e.g., on a rotational basis) to ensure fair and equitable        
allocation among accounts; and limitations on short sales of securities. These  
procedures also require documentation and review of justifications for any      
decisions to make investments only for select accounts or in a manner           
disproportionate to the size of the account.                                    

Portfolio Manager Compensation                                                  
------------------------------                                                  

          The Adviser's compensation program for investment professionals is
designed to be competitive and effective in order to attract and retain the     
highest caliber employees. The compensation program for investment professionals
is designed to reflect their ability to generate long-term investment success   
for our clients, including shareholders of the AllianceBernstein Mutual Funds.  
Investment professionals' annual compensation is comprised of the following:    

        (i) Fixed base salary: This is generally the smallest portion of
compensation. The base salary is a relatively low, fixed salary within a similar
range for all investment professionals. The base salary is determined at the    
outset of employment based on level of experience, does not change significantly
from year-to-year and hence, is not particularly sensitive to performance.      

          (ii) Discretionary incentive compensation in the form of an annual
cash bonus: The Adviser's overall profitability determines the total amount of  
incentive compensation available to investment professionals. This portion of   
compensation is determined subjectively based on qualitative and quantitative   
factors. In evaluating this component of an investment professional's           
compensation, the Adviser considers the contribution to his/her team or         
discipline as it relates to that team's overall contribution to the long-term   
investment success, business results and strategy of the Adviser. Quantitative  
factors considered include, among other things, relative investment performance 
(e.g., by comparison to competitor or peer group funds or similar styles of     
investments, and appropriate, broad-based or specific market indices), and      
consistency of performance. There are no specific formulas used to determine    
this part of an investment professional's compensation and the compensation is  
not tied to any pre-determined or specified level of performance. The Adviser   
also considers qualitative factors such as the complexity and risk of investment
strategies involved in the style or type of assets managed by the investment    
professional; success of marketing/business development efforts and client      
servicing; seniority/length of service with the firm; management and supervisory
responsibilities; and fulfillment of the Adviser's leadership criteria.         

        (iii) Discretionary incentive compensation in the form of awards
under the Adviser's Partners Compensation Plan ("deferred awards"): The         
Adviser's overall profitability determines the total amount of deferred awards  
available to investment professionals. The deferred awards are allocated among  
investment professionals based on criteria similar to those used to determine   
the annual cash bonus. There is no fixed formula for determining these amounts. 
Deferred awards, for which, prior to 2009, there were various investment        
options, vest over a four-year period and are generally forfeited if the        
employee resigns or the Adviser terminates his/her employment. Prior to 2009,   
investment options under the deferred awards plan included many of the same     
AllianceBernstein Mutual Funds offered to mutual fund investors. Beginning in   
2009, all deferred awards are in the form of the Adviser's publicly traded      
equity securities. Prior to 2002, investment professional compensation also     
included discretionary long-term incentive in the form of restricted grants of  
the Adviser's Master Limited Partnership Units.                                 

          (iv) Contributions under the Adviser's Profit Sharing/401(k) Plan:
The contributions are based on the Adviser's overall profitability. The amount  
and allocation of the contributions are determined at the sole discretion of the
Adviser.                                                                        

          (v) Compensation under the Adviser's Special Option Program: Under
this Program, certain investment professionals may be permitted to allocate a   
portion of their deferred awards to options to buy the Adviser's publicly traded
equity securities, and to receive a two-for-one match of such allocated amount. 
The determination of who may be eligible to participate in the Special Option   
Program is made at the sole discretion of the Adviser.                          

Board of Directors Information                                                  
------------------------------                                                  

   The business and affairs of each Fund are managed under the
direction of each Fund's Board, which is composed of the same Directors. Certain
information concerning the Funds' Directors is set forth below.                 

                                                        [Enlarge/Download Table]


                                                         PORTFOLIOS  OTHER PUBLIC        
                                                         IN FUND     COMPANY             
                              PRINCIPAL                  COMPLEX     DIRECTORSHIPS       
NAME, ADDRESS*,               OCCUPATION(S) DURING       OVERSEEN    HELD BY             
AGE AND                       PAST FIVE YEARS OR         BY          DIRECTOR IN THE     
(YEAR FIRST ELECTED**)        LONGER                     DIRECTOR    PAST FIVE YEARS     
----------------------        --------------------       ----------  ---------------     
                                                                                         
INDEPENDENT DIRECTORS                                                                    

Chairman of the Board                                                                    

William H. Foulk, Jr., #, ##  Investment Adviser and an       97     None                
78                            Independent Consultant                                     
(1998 - Intermediate Bond)    since prior to 2006.                                       
(1992 - Global Bond)          Previously, he was Senior                                  
(1993 - High Income)          Manager of Barrett                                         
(1995 - Unconstrained Bond)   Associates, Inc., a                                        
                              registered investment                                      
                              adviser. He was formerly                                   
                              Deputy Comptroller and                                     
                              Chief Investment Officer                                   
                              of the State of New York                                   
                              and, prior thereto, Chief                                  
                              Investment Officer of the                                  
                              New York Bank for                                          
                              Savings. He has served as                                  
                              a director or trustee of                                   
                              various AllianceBernstein                                  
                              Funds since 1983 and has                                   
                              been Chairman of the                                       
                              AllianceBernstein Funds                                    
                              and of the Independent                                     
                              Directors Committee of                                     
                              such Funds since 2003.                                     

John H. Dobkin, ##            Independent Consultant          96     None                
68                            since prior to 2006.                                       
(1998 - Intermediate Bond)    Formerly, President of                                     
(1992 - Global Bond)          Save Venice, Inc.                                          
(1993 - High Income)          (preservation                                              
(1995 - Unconstrained Bond)   organization) from 2001 -                                  
                              2002, Senior Advisor from                                  
                              June 1999 - June 2000 and                                  
                              President of Historic                                      
                              Hudson Valley (historic                                    
                              preservation) from                                         
                              December 1989 - May 1999.                                  
                              Previously, Director of                                    
                              the National Academy of                                    
                              Design. He has served as                                   
                              a director or trustee of                                   
                              various AllianceBernstein                                  
                              Funds since 1992.                                          

Michael J. Downey, ##         Private Investor since          96     Asia Pacific Fund,  
67                            prior to 2006. Formerly,               Inc. and The Merger 
(2005 - Intermediate Bond)    managing partner of                    Fund since prior to 
(2005 - Global Bond)          Lexington Capital, LLC                 2006 and Prospect   
(2005 - High Income)          (investment advisory                   Acquisition Corp.   
(2005 - Unconstrained Bond)   firm) from December 1997               (financial services)
                              until December 2003. From              since 2007 until    
                              1987 until 1993, Chairman              2009                
                              and CEO of Prudential                                      
                              Mutual Fund Management,                                    
                              director of the                                            
                              Prudential Mutual Funds                                    
                              and member of the                                          
                              Executive Committee of                                     
                              Prudential Securities                                      
                              Inc. He has served as a                                    
                              director or trustee of                                     
                              the AllianceBernstein                                      
                              Funds since 2005.                                          

D. James Guzy, ##             Chairman of the Board of        96     Cirrus Logic        
74                            PLX Technology                         Corporation         
(2005 - Intermediate Bond)    (semi-conductors) and of               (semi-conductors)   
(2005 - Global Bond)          SRC Computers Inc., with               and PLX Technology, 
(2005 - High Income)          which he has been                      Inc.                
(2005 - Unconstrained Bond)   associated since prior to              (semi-conductors)   
                              2006. He was a Director                since prior to 2006 
                              of Intel Corporation                   and Intel           
                              (semi-conductors) from                 Corporation         
                              1969 until 2008, and                   (semi-conductors)   
                              served as Chairman of the              since prior to 2006 
                              Finance Committee of such              until 2008          
                              company for several years                                  
                              until May 2008. He has                                     
                              served as a director or                                    
                              trustee of one or more of                                  
                              the AllianceBernstein                                      
                              Funds since 1982.                                          

Nancy P. Jacklin, ##          Professorial Lecturer at        96     None                
62                            the Johns Hopkins School                                   
(2006 - Intermediate Bond)    of Advanced International                                  
(2006 - Global Bond)          Studies since 2008.                                        
(2006 - High Income)          Formerly, U.S. Executive                                   
(2006 - Unconstrained Bond)   Director of the                                            
                              International Monetary                                     
                              Fund (December 2002-May                                    
                              2006); Partner, Clifford                                   
                              Chance (1992-2002);                                        
                              Sector Counsel,                                            
                              International Banking and                                  
                              Finance, and Associate                                     
                              General Counsel, Citicorp                                  
                              (1985-1992); Assistant                                     
                              General Counsel                                            
                              (International), Federal                                   
                              Reserve Board of                                           
                              Governors (1982-1985);                                     
                              and Attorney Advisor,                                      
                              U.S. Department of the                                     
                              Treasury (1973-1982).                                      
                              Member of the Bar of the                                   
                              District of Columbia and                                   
                              of New York; and member                                    
                              of the Council on Foreign                                  
                              Relations. She has served                                  
                              as a director or trustee                                   
                              of the AllianceBernstein                                   
                              Funds since 2006.                                          

Garry L. Moody, ##            Independent Consultant.         96     None                
58                            Formerly, Partner,                                         
(2008 - Intermediate Bond)    Deloitte & Touche LLP                                      
(2008 - Global Bond)          (1995-2008) where he held                                  
(2008 - High Income)          a number of senior                                         
(2008 - Unconstrained Bond)   positions, including Vice                                  
                              Chairman, and U.S. and                                     
                              Global Investment                                          
                              Management Practice                                        
                              Managing Partner;                                          
                              President, Fidelity                                        
                              Accounting and Custody                                     
                              Services Company                                           
                              (1993-1995); and Partner,                                  
                              Ernst & Young LLP                                          
                              (1975-1993), where he                                      
                              served as the National                                     
                              Director of Mutual Fund                                    
                              Tax Services. He has                                       
                              served as a director or                                    
                              trustee, and as Chairman                                   
                              of the Audit Committee,                                    
                              of most of the                                             
                              AllianceBernstein Funds                                    
                              since 2008.                                                

Marshall C. Turner, Jr., ##   Private Investor since          96     Xilinx, Inc.        
69                            prior to 2006. Interim                 (programmable logic 
(2005 - Intermediate Bond)    CEO of MEMC Electronic                 semi-conductors) and
(2005 - Global Bond)          Materials, Inc.                        MEMC Electronic     
(2005 - High Income)          (semi-conductor and solar              Materials, Inc.     
(2005 - Unconstrained Bond)   cell substrates) from                  (semi-conductor and 
                              November 2008 until March              solar cell          
                              2009. He was Chairman and              substrates) since   
                              CEO of Dupont Photomasks,              prior to 2006       
                              Inc. (components of                                        
                              semi-conductor                                             
                              manufacturing),                                            
                              2003-2005, and President                                   
                              and CEO, 2005-2006, after                                  
                              the company was acquired                                   
                              and renamed Toppan                                         
                              Photomasks, Inc. He has                                    
                              served as a director or                                    
                              trustee of one or more of                                  
                              the AllianceBernstein                                      
                              Funds since 1992.                                          

Earl D. Weiner, ##            Of Counsel, and Partner         96     None                
71                            prior to January 2007, of                                  
(2007 - Intermediate Bond)    the law firm Sullivan &                                    
(2007 - Global Bond)          Cromwell LLP, and member                                   
(2007 - High Income)          of ABA Federal Regulation                                  
(2007 - Unconstrained Bond)   of Securities Committee                                    
                              Task Force to draft                                        
                              editions of the Fund                                       
                              Director's Guidebook. He                                   
                              has served as a director                                   
                              or trustee of the                                          
                              AllianceBernstein Funds                                    
                              since 2007 and is                                          
                              Chairman of the                                            
                              Governance and Nominating                                  
                              Committees of most of the                                  
                              Funds.                                                     

INTERESTED DIRECTOR                                                                      
-------------------                                                                      

Robert M. Keith, +,++         Senior Vice President of        97     None                
50                            the Adviser+++ and head                                    
                              of AllianceBernstein                                       
                              Investments, Inc.                                          
                              ("ABI")+++ since July                                      
                              2008; Director of ABI and                                  
                              President of the                                           
                              AllianceBernstein Mutual                                   
                              Funds. Previously, he                                      
                              served as Executive                                        
                              Managing Director of ABI                                   
                              from December 2006 to                                      
                              June 2008. Prior to                                        
                              joining ABI in 2006,                                       
                              Executive Managing                                         
                              Director of Bernstein                                      
                              Global Wealth Management,                                  
                              and prior thereto, Senior                                  
                              Managing Director and                                      
                              Global Head of Client                                      
                              Service and Sales of the                                   
                              Adviser's institutional                                    
                              investment management                                      
                              business since 2004.                                       
                              Prior thereto, Managing                                    
                              Director and Head of                                       
                              North American Client                                      
                              Service and Sales in the                                   
                              Adviser's institutional                                    
                              investment management                                      
                              business, with which he                                    
                              had been associated since                                  
                              prior to 2004.                                             

--------                                                                        
*     The address for each of the Fund's Directors is c/o AllianceBernstein     
 L.P., Attention: Philip L. Kirstein, 1345 Avenue of the Americas, New
York, NY 10105.                                                     

**    There is no stated term of office for the Funds' Directors.               

#     Member of the Fair Value Pricing Committee.                               

##    Member of the Audit Committee, the Governance and Nominating Committee and
the Independent Directors Committee.                                

+     Mr. Keith became a Director of the Funds as of December 16, 2010.         

++    Mr. Keith is an "interested person", as defined in Section 2(a)(19) of the
    1940 Act, of the Funds due to his position as a Senior Vice President of
the Adviser.                                                        

+++   The Adviser and ABI are affiliates of the Funds.                          

           The management of the business and affairs of each Fund are managed
under the direction of the Board. Directors who are not "interested persons" of 
the Fund as defined in the 1940 Act, are referred to as "Independent Directors",
and Directors who are "interested persons" of the Fund are referred to as       
"Interested Directors." Certain information concerning the Fund's governance    
structure and each Director is set forth below.                                 

       Experience, Skills, Attributes and Qualifications of the Funds'
Directors. The Governance and Nominating Committee of each Fund's Board, which  
is composed of Independent Directors, reviews the experience, qualifications,   
attributes and skills of potential candidates for nomination or election by the 
Board, and conducts a similar review in connection with the proposed nomination 
of current Directors for re-election by stockholders at any annual or special   
meeting of stockholders. In evaluating a candidate for nomination or election as
a Director, the Governance and Nominating Committee takes into account the      
contribution that the candidate would be expected to make to the diverse mix of 
experience, qualifications, attributes and skills that the Governance and       
Nominating Committee believes contributes to good governance for the Fund.      
Additional information concerning the Governance and Nominating Committee's     
consideration of nominees appears in the description of the Committee below.    

         Each Fund's Board believes that, collectively, the Directors have
balanced and diverse experience, qualifications, attributes and skills, which   
allow the Board to operate effectively in governing the Fund and protecting the 
interests of stockholders. The Board of each Fund has concluded that, based on  
each Director's experience, qualifications, attributes or skills on an          
individual basis and in combination with those of the other Directors, each     
Director is qualified and should continue to serve as such.                     

         In determining that a particular Director was and continues to be
qualified to serve as a Director, each Board has considered a variety of        
criteria, none of which, in isolation, was controlling. In addition, each Board 
has taken into account the actual service and commitment of each Director during
his or her tenure (including the Director's commitment and participation in     
Board and committee meetings, as well as his or her current and prior leadership
of standing and ad hoc committees) in concluding that each should continue to   
serve. Additional information about the specific experience, skills, attributes 
and qualifications of each Director, which in each case led to the Board's      
conclusion that the Director should serve (or continue to serve) as trustee or  
director of the Fund, is provided in the table above and in the next paragraph. 

         Among other attributes and qualifications common to all Directors
are their ability to review critically, evaluate, question and discuss          
information provided to them (including information requested by the Directors),
to interact effectively with the Adviser, other service providers, counsel and  
the Fund's independent registered public accounting firm, and to exercise       
effective business judgment in the performance of their duties as Directors. In 
addition to his or her service as a Director of the Fund and other              
AllianceBernstein Funds as noted in the table above: Mr. Dobkin has experience  
as an executive of a number of organizations and served as Chairman of the Audit
Committee of many of the AllianceBernstein Funds from 2001 to 2008; Mr. Downey  
has experience in the investment advisory business including as Chairman and    
Chief Executive Officer of a large fund complex and as director of a number of  
non-AllianceBernstein funds and as Chairman of a non-AllianceBernstein          
closed-end fund; Mr. Foulk has experience in the investment advisory and        
securities businesses, including as Deputy Controller and Chief Investment      
Officer of the State of New York (where his responsibilities included bond      
issuances, cash management and oversight of the New York Common Retirement      
Fund), has served as Chairman of the AllianceBernstein Funds and of the         
Independent Directors Committee since 2003, and is active in a number of mutual 
fund related organizations and committees; Mr. Guzy has experience as a         
corporate director including as Chairman of a public company and Chairman of the
Finance Committee of a large public technology company; Ms. Jacklin has         
experience as a financial services regulator including as U.S. Executive        
Director of the International Monetary Fund, which is responsible for ensuring  
the stability of the international monetary system, and as a financial services 
lawyer in private practice; Mr. Keith has experience as an executive of the     
Adviser with responsibility for, among other things, the AllianceBernstein      
Funds; Mr. Moody has experience as an certified public accountant including     
experience as Vice Chairman and U.S. and Global Investment Management Practice  
Partner for a major accounting firm, is a member of the governing council of an 
organization of independent directors of mutual funds, and has served as        
Chairman of the Audit Committee of most of the AllianceBernstein Funds since    
2008; Mr. Turner has experience as a director (including Chairman and Chief     
Executive officer of a number of companies) and as a venture capital investor   
including prior service as general partner of three institutional venture       
capital partnerships; and Mr. Weiner has experience as a securities lawyer whose
practice includes registered investment companies and as Chairman, director or  
trustee of a number of boards, and has served as Chairman of the Governance and 
Nominating Committee of most of the AllianceBernstein Funds. The disclosure     
herein of a director's experience, qualifications, attributes and skills does   
not impose on such director any duties, obligations, or liability that are      
greater than the duties, obligations and liability imposed on such director as a
member of the Board and any committee thereof in the absence of such experience,
qualifications, attributes and skills.                                          

    Board Structure and Oversight Function. Each Fund's Board is
responsible for oversight of that Fund. Each Fund has engaged the Adviser to    
manage the Fund on a day-to-day basis. Each Board is responsible for overseeing 
the Adviser and the Fund's other service providers in the operations of that    
Fund in accordance with the Fund's investment objective and policies and        
otherwise in accordance with its prospectus, the requirements of the 1940 Act   
and other applicable Federal, state and other securities and other laws, and the
Fund's charter and bylaws. Each Board meets in-person at regularly scheduled    
meetings eight times throughout the year. In addition, the Directors may meet   
in-person or by telephone at special meetings or on an informal basis at other  
times. The Independent Directors also regularly meet without the presence of any
representatives of management. As described below, each Board has established   
four standing committees - the Audit, Governance and Nominating, Independent    
Directors, and Fair Value Pricing Committees - and may establish ad hoc         
committees or working groups from time to time, to assist the Board in          
fulfilling its oversight responsibilities. Each committee is composed           
exclusively of Independent Directors. The responsibilities of each committee,   
including its oversight responsibilities, are described further below. The      
Independent Directors have also engaged independent legal counsel, and may from 
time to time engage consultants and other advisors, to assist them in performing
their oversight responsibilities.                                               

     An Independent Director serves as Chairman of each Board. The
Chairman's duties include setting the agenda for each Board meeting in          
consultation with management, presiding at each Board meeting, meeting with     
management between Board meetings, and facilitating communication and           
coordination between the Independent Directors and management. The Directors    
have determined that a Board's leadership by an Independent Director and its    
committees composed exclusively of Independent Directors is appropriate because 
they believe it sets the proper tone to the relationships between the Fund, on  
the one hand, and the Adviser and other service providers, on the other, and    
facilitates the exercise of the Board's independent judgment in evaluating and  
managing the relationships. In addition, each Fund is required to have an       
Independent Director as Chairman pursuant to certain 2003 regulatory settlements
involving the Adviser.                                                          

            Risk Oversight. Each Fund is subject to a number of risks, including
investment, compliance and operational risks. Day-to-day risk management with   
respect to a Fund resides with the Adviser or other service providers (depending
on the nature of the risk), subject to supervision by the Adviser. Each Board   
has charged the Adviser and its affiliates with (i) identifying events or       
circumstances, the occurrence of which could have demonstrable and material     
adverse effects on the Fund; (ii) to the extent appropriate, reasonable or      
practicable, implementing processes and controls reasonably designed to lessen  
the possibility that such events or circumstances occur or to mitigate the      
effects of such events or circumstances if they do occur; and (iii) creating and
maintaining a system designed to evaluate continuously, and to revise as        
appropriate, the processes and controls described in (i) and (ii) above.        

            Risk oversight forms part of a Board's general oversight of a Fund's
investment program and operations and is addressed as part of various regular   
Board and committee activities. Each Fund's investment management and business  
affairs are carried out by or through the Adviser and other service providers.  
Each of these persons has an independent interest in risk management but the    
policies and the methods by which one or more risk management functions are     
carried out may differ from the Fund's and each other's in the setting of       
priorities, the resources available or the effectiveness of relevant controls.  
Oversight of risk management is provided by the Board and the Audit Committee.  
The Directors regularly receive reports from, among others, management          
(including the Global Heads of Investment Risk and Trading Risk of the Adviser),
a Fund's Senior Officer (who is also a Fund's chief compliance officer), its    
independent registered public accounting firm, counsel, and internal auditors   
for the Adviser, as appropriate, regarding risks faced by the Fund and the      
Adviser's risk management programs.                                             

       Not all risks that may affect a Fund can be identified, nor can
controls be developed to eliminate or mitigate their occurrence or effects. It  
may not be practical or cost-effective to eliminate or mitigate certain risks,  
the processes and controls employed to address certain risks may be limited in  
their effectiveness, and some risks are simply beyond the reasonable control of 
the Fund or the Adviser, its affiliates or other service providers. Moreover, it
is necessary to bear certain risks (such as investment-related risks) to achieve
a Fund's goals. As a result of the foregoing and other factors a Fund's ability 
to manage risk is subject to substantial limitations.                           

         Each Fund's Board has four standing committees of the Board -- an
Audit Committee, a Governance and Nominating Committee, a Fair Value Pricing    
Committee and an Independent Directors Committee. The members of the Audit,     
Governance and Nominating, Fair Value Pricing and Independent Directors         
Committees are identified above.                                                

            The function of the Audit Committee is to assist the Boards in their
oversight of the Fund's financial reporting process. The Audit Committee of     
Intermediate Bond, Unconstrained Bond, Global Bond and High Income met twice,   
three times, twice and twice, respectively, during the Fund's most recently     
completed fiscal year.                                                          

            The function of the Governance and Nominating Committee includes the
nomination of persons to fill any vacancies or newly created positions on the   
Boards. The Governance and Nominating Committee of Intermediate Bond,           
Unconstrained Bond, Global Bond and High Income met four, four, four and four   
times, respectively, during the Fund's most recently completed fiscal year.     

           The Governance and Nominating Committee has a charter and, pursuant
to the charter, the Governance and Nominating Committee will consider candidates
for nomination as a trustee submitted by a shareholder or group of shareholders 
who have beneficially owned at least 5% of the Fund's common stock or shares of 
beneficial interest for at least two years prior to the time of submission and  
who timely provide specified information about the candidates and the nominating
shareholder or group. To be timely for consideration by the Governance and      
Nominating Committee, the submission, including all required information, must  
be submitted in writing to the attention of the Secretary at the principal      
executive offices of the Funds not less than 120 days before the date of the    
proxy statement for the previous year's annual meeting of shareholders. If the  
Funds did not hold an annual meeting of shareholders in the previous year, the  
submission must be delivered or mailed and received within a reasonable amount  
of time before the Funds begins to print and mail its proxy materials. Public   
notice of such upcoming annual meeting of shareholders may be given in a        
shareholder report or other mailing to shareholders or by other means deemed by 
the Governance and Nominating Committee or the Board to be reasonably calculated
to inform shareholders.                                                         

    Shareholders submitting a candidate for consideration by the
Governance and Nominating Committee must provide the following information to   
the Governance and Nominating Committee: (i) a statement in writing setting     
forth (A) the name, date of birth, business address and residence address of the
candidate; (B) any position or business relationship of the candidate, currently
or within the preceding five years, with the shareholder or an associated person
of the shareholder as defined below; (C) the class or series and number of all  
shares of a Fund owned of record or beneficially by the candidate; (D) any other
information regarding the candidate that is required to be disclosed about a    
nominee in a proxy statement or other filing required to be made in connection  
with the solicitation of proxies for election of Directors pursuant to Section  
20 of the 1940 Act and the rules and regulations promulgated thereunder; (E)    
whether the shareholder believes that the candidate is or will be an "interested
person" of the Funds (as defined in the 1940 Act) and, if believed not to be an 
"interested person," information regarding the candidate that will be sufficient
for the Funds to make such determination; and (F) information as to the         
candidate's knowledge of the investment company industry, experience as a       
director or senior officer of public companies, directorships on the boards of  
other registered investment companies and educational background; (ii) the      
written and signed consent of the candidate to be named as a nominee and to     
serve as a Director if elected; (iii) the written and signed agreement of the   
candidate to complete a directors' and officers' questionnaire if elected; (iv) 
the shareholder's consent to be named as such by the Funds; (v) the class or    
series and number of all shares of a fund of the Funds owned beneficially and of
record by the shareholder and any associated person of the shareholder and the  
dates on which such shares were acquired, specifying the number of shares owned 
beneficially but not of record by each, and stating the names of each as they   
appear on the Funds' record books and the names of any nominee holders for each;
and (vi) a description of all arrangements or understandings between the        
shareholder, the candidate and/or any other person or persons (including their  
names) pursuant to which the recommendation is being made by the shareholder.   
"Associated Person of the shareholder" means any person who is required to be   
identified under clause (vi) of this paragraph and any other person controlling,
controlled by or under common control with, directly or indirectly, (a) the     
shareholder or (b) the associated person of the shareholder.                    

           The Governance and Nominating Committee may require the shareholder
to furnish such other information as it may reasonably require or deem necessary
to verify any information furnished pursuant to the nominating procedures       
described above or to determine the qualifications and eligibility of the       
candidate proposed by the shareholder to serve on the Board. If the shareholder 
fails to provide such other information in writing within seven days of receipt 
of written request from the Governance and Nominating Committee, the            
recommendation of such candidate as a nominee will be deemed not properly       
submitted for consideration, and will not be considered, by the Committee.      

      The Governance and Nominating Committee will consider only one
candidate submitted by such a shareholder or group for nomination for election  
at an annual meeting of shareholders. The Governance and Nominating Committee   
will not consider self-nominated candidates. The Governance and Nominating      
Committee will consider and evaluate candidates submitted by shareholders on the
basis of the same criteria as those used to consider and evaluate candidates    
submitted from other sources. These criteria include the candidate's relevant   
knowledge, experience, and expertise, the candidate's ability to carry out his  
or her duties in the best interests of the Fund, the candidate's ability to     
qualify as an Independent Director. When assessing a candidate for nomination,  
the Committee considers whether the individual's background, skills, and        
experience will complement the background, skills, and experience of other      
nominees and will contribute to the diversity of the Board.                     

           The function of the Fair Value Pricing Committee is to consider, in
advance if possible, any fair valuation decision of the Adviser's Valuation     
Committee relating to a security held by the Funds made under unique or highly  
unusual circumstances not previously addressed by the Valuation Committee that  
would result in a change in the Funds' NAV by more than $0.01 per share. The    
Fair Value Pricing Committee did not meet during the Funds' most recently       
completed fiscal year.                                                          

          The function of the Independent Directors Committee is to consider
and take action on matters that the Board or Committee believes should be       
addressed in executive session of the Independent Directors, such as review and 
approval of the Advisory and Distribution Services Agreements. The Independent  
Directors Committee of Intermediate Bond, Unconstrained Bond, Global Bond and   
High Income met seven, seven, seven and seven times, respectively, during the   
Fund's most recently completed fiscal year.                                     

         The dollar range of each Fund's securities owned by each Director
and the aggregate dollar range of securities owned in all of the registered     
investment companies to which the Adviser provides investment advisory services 
(collectively, the "AllianceBernstein Fund Complex") owned by each Director are 
set forth below.                                                                

ALLIANCEBERNSTEIN INTERMEDIATE BOND PORTFOLIO                                   

                                                      AGGREGATE DOLLAR
                                                     RANGE OF EQUITY
                              DOLLAR RANGE OF          SECURITIES IN THE
                              EQUITY SECURITIES IN     ALLIANCEBERNSTEIN
                               THE PORTFOLIO AS OF      FUND COMPLEX AS OF
                              DECEMBER 31, 2010        DECEMBER 31, 2010
                              -----------------        -----------------

John H. Dobkin                 None                     Over $100,000     
Michael J. Downey              None                     Over $100,000     
William H. Foulk, Jr.          None                     Over $100,000     
D. James Guzy                  None                     Over $100,000     
Nancy P. Jacklin               None                     Over $100,000     
Robert M. Keith*               None                          None         
Garry L. Moody                 None                     Over $100,000     
Marshall C. Turner, Jr.        None                     Over $100,000     
Earl D. Weiner                 None                     Over $100,000     

--------                                                                        
*     For information presented as of December 31, 2010, with respect to Mr.    
Keith, unvested interests in certain deferred compensation plans,   
including the Partners Compensation Plan are not included.          

ALLIANCEBERNSTEIN UNCONSTRAINED BOND FUND, INC.                                 

                                                      AGGREGATE DOLLAR
                                                     RANGE OF EQUITY
                              DOLLAR RANGE OF          SECURITIES IN THE
                              EQUITY SECURITIES IN     ALLIANCEBERNSTEIN
                               THE PORTFOLIO AS OF      FUND COMPLEX AS OF
                              DECEMBER 31, 2010        DECEMBER 31, 2010
                              -----------------        -----------------

John H. Dobkin                       None               Over $100,000     
Michael J. Downey                    None               Over $100,000     
William H. Foulk, Jr.                None               Over $100,000     
D. James Guzy                        None               Over $100,000     
Nancy P. Jacklin                     None               Over $100,000     
Robert M. Keith*                     None                    None         
Garry L. Moody                       None               Over $100,000     
Marshall C. Turner, Jr.         $50,001-$100,000        Over $100,000     
Earl D. Weiner                       None               Over $100,000     

--------                                                                        
*     For information presented as of December 31, 2010, with respect to Mr.    
Keith, unvested interests in certain deferred compensation plans,   
including the Partners Compensation Plan are not included.          

ALLIANCEBERNSTEIN GLOBAL BOND FUND, INC.                                        

                                                      AGGREGATE DOLLAR
                                                     RANGE OF EQUITY
                              DOLLAR RANGE OF          SECURITIES IN THE
                              EQUITY SECURITIES IN     ALLIANCEBERNSTEIN
                               THE PORTFOLIO AS OF      FUND COMPLEX AS OF
                              DECEMBER 31, 2010        DECEMBER 31, 2010
                              -----------------        -----------------

John H. Dobkin                 $10,001 - $50,000        Over $100,000     
Michael J. Downey              None                     Over $100,000     
William H. Foulk, Jr.          None                     Over $100,000     
D. James Guzy                  None                     Over $100,000     
Nancy P. Jacklin               None                     Over $100,000     
Robert M. Keith*               None                          None         
Garry L. Moody                 None                     Over $100,000     
Marshall C. Turner, Jr.        None                     Over $100,000     
Earl D. Weiner                 None                     Over $100,000     

--------                                                                        
*     For information presented as of December 31, 2010, with respect to Mr.    
Keith, unvested interests in certain deferred compensation plans,   
including the Partners Compensation Plan are not included.          

ALLIANCEBERNSTEIN HIGH INCOME FUND, INC.                                        

                                                      AGGREGATE DOLLAR
                                                     RANGE OF EQUITY
                              DOLLAR RANGE OF          SECURITIES IN THE
                              EQUITY SECURITIES IN     ALLIANCEBERNSTEIN
                               THE PORTFOLIO AS OF      FUND COMPLEX AS OF
                              DECEMBER 31, 2010        DECEMBER 31, 2010
                              -----------------        -----------------

John H. Dobkin                 None                     Over $100,000     
Michael J. Downey              None                     Over $100,000     
William H. Foulk, Jr.          None                     Over $100,000     
D. James Guzy                  None                     Over $100,000     
Nancy P. Jacklin               None                     Over $100,000     
Robert M. Keith*               None                          None         
Garry L. Moody                 None                     Over $100,000     
Marshall C. Turner, Jr.        None                     Over $100,000     
Earl D. Weiner                 None                     Over $100,000     

--------                                                                        
*     For information presented as of December 31, 2010, with respect to Mr.    
Keith, unvested interests in certain deferred compensation plans,   
including the Partners Compensation Plan are not included.          

Officer Information                                                             
-------------------                                                             

Certain information concerning each Fund's officers is set forth below.         

NAME, ADDRESS,*          POSITION(S)             PRINCIPAL OCCUPATION           
AND AGE                  HELD WITH FUND          DURING PAST 5 YEARS            
-------                  --------------          -------------------            

Robert M. Keith,         President and Chief     See above.                     
50                       Executive Officer                                      

Philip L. Kirstein,      Senior Vice President   Senior Vice President and      
Independent              and Independent         Independent Compliance Officer 
65                       Compliance Officer      of the AllianceBernstein Funds,
                                        with which he has been
                                                associated since October 2004.
                                       Prior thereto, he was
                                             Of Counsel to Kirkpatrick &
                                                 Lockhart, LLP from October 2003
                                              to October 2004, and General
                                          Counsel of Merrill Lynch
                                                 Investment Managers, L.P. since
                                      prior to March 2003.

Emilie D. Wrapp,         Secretary               Senior Vice President,         
55                                               Assistant General Counsel and  
                                               Assistant Secretary of ABI,**
                                         with which she has been
                                                 associated since prior to 2006.

Joseph J. Mantineo,      Treasurer and Chief     Senior Vice President of       
51                       Financial Officer       ABIS,** with which he has been 
                                                 associated since prior to 2006.

Stephen M. Woetzel,      Controller              Vice President of ABIS,** with 
39                                               which he has been associated   
                                      since prior to 2006.

Intermediate Bond                                                               
-----------------                                                               

Paul J. DeNoon,          Vice President          Senior Vice President of the   
48                                               Adviser,** with which he has   
                                                been associated since prior to
                       2006.

Shawn E. Keegan,         Vice President          Vice President of the          
39                                               Adviser,** with which he has   
                                                been associated since prior to
                       2006.

Alison M. Martier,       Vice President          Senior Vice President of the   
54                                               Adviser,** with which she has  
                                                been associated since prior to
                       2006.

Douglas J. Peebles,      Vice President          Senior Vice President of the   
45                                               Adviser,** with which he has   
                                                been associated since prior to
                       2006.

Greg J. Wilensky,        Vice President          Senior Vice President of the   
43                                               Adviser,** with which he has   
                                                been associated since prior to
                       2006.

Unconstrained Bond                                                              
------------------                                                              

Paul J. DeNoon,          Vice President          See above.                     
48                                                                              

Joran Laird,             Vice President          Vice President of the          
35                                               Adviser,** with which he has   
                                                been associated since prior to
                       2006.

Douglas J. Peebles,      Vice President          See above.                     
45                                                                              

Matthew S. Sheridan,     Vice President          Vice President of the          
35                                               Adviser,** with which he has   
                                                been associated since prior to
                       2006.

Greg J. Wilensky,        Vice President          See above.                     
43                                                                              

Global Bond                                                                     
-----------                                                                     

Paul J. DeNoon,          Vice President          See above.                     
48                                                                              

Scott DiMaggio,          Vice President          Senior Vice President of the   
39                                               Adviser,** with which he has   
                                                been associated since prior to
                       2006.

Michael L. Mon,          Vice President          Vice President of the          
41                                               Adviser,** with which he has   
                                                been associated since prior to
                       2006.

Douglas J. Peebles,      Senior Vice President   See above.                     
45                                                                              

Matthew S. Sheridan,     Vice President          See above.                     
35                                                                              

High Income                                                                     
-----------                                                                     

Paul J. DeNoon,          Vice President          See above.                     
48                                                                              

Gershon M. Distenfeld,   Vice President          Senior Vice President of the   
35                                               Adviser,** with which he has   
                                                been associated since prior to
                       2006.

Douglas J. Peebles,      Senior Vice President   See above.                     
45                                                                              

Marco Santamaria,        Vice President          Vice President of the          
45                                               Adviser,** with which he has   
                                            been associated since June
                                               2010. Prior thereto, he was a
                                            founding partner at Global
                                         Securities Advisors, an
                                          emerging-market-oriented
                                               fixed-income hedge fund since
                                prior to 2006.

Matthew S. Sheridan,     Vice President          See above.                     
35                                                                              

--------                                                                        
*     The address for each of the Fund's Officers is 1345 Avenue of the         
Americas, New York, NY 10105.                                       
**    The Adviser, ABI and ABIS are affiliates of each Fund.                    

         The Funds do not pay any fees to, or reimburse expenses of, their
Directors who are considered "interested persons" of the Funds. The aggregate   
compensation paid by a Fund to each of the Directors during its fiscal year, the
aggregate compensation paid to each of the Directors during calendar year 2010  
by the AllianceBernstein Fund Complex, and the total number of registered       
investment companies (and separate investment portfolios within the companies)  
in the AllianceBernstein Fund Complex with respect to which each of the         
Directors serves as a director or trustee are set forth below. Neither the Funds
nor any other fund in the AllianceBernstein Fund Complex provides compensation  
in the form of pension or retirement benefits to any of its directors or        
trustees. Each of the Directors is a director or trustee of one or more other   
registered investment companies in the AllianceBernstein Fund Complex.          

ALLIANCEBERNSTEIN INTERMEDIATE BOND PORTFOLIO 

                                                        [Enlarge/Download Table]


                                                         Total Number of      Total Number of    
                                                         Investment           Investment Funds   
                                      Total              Companies in the     within the         
                      Aggregate       Compensation       AllianceBernstein    AllianceBernstein  
                      Compensation    from the           Fund Complex,        Fund Complex,      
                      from the Fund*  AllianceBernstein  Including the        Including the Fund,
                      for the Fiscal  Fund Complex,      Fund, as to which    as to which the    
                      Year Ended      Including          the Director is a    Director is a      
Name of Director      10/31/10        the Fund           Director or Trustee  Director or Trustee
----------------      ------------    -----------------  -------------------  -------------------
                                                                                                 
John H. Dobkin        $2,591          $236,900                33                   96            
Michael J. Downey     $2,591          $236,900                33                   96            
William H. Foulk, Jr. $4,875          $482,300                34                   97            
D. James Guzy         $2,591          $236,900                33                   96            
Nancy P. Jacklin      $2,591          $236,900                33                   96            
Robert M. Keith       $    0          $      0                34                   97            
Garry L. Moody        $2,968          $264,900                33                   96            
Marshall C. Turner    $2,591          $236,900                33                   96            
Earl D. Weiner        $2,788          $254,900                33                   96            

          As of January 4, 2011, the Directors and officers of the Fund as a
group owned less than 1% of the shares of the Fund.                             

ALLIANCEBERNSTEIN UNCONSTRAINED BOND FUND, INC. 

                                                        [Enlarge/Download Table]


                                                         Total Number of      Total Number of    
                                                         Investment           Investment Funds   
                                      Total              Companies in the     within the         
                      Aggregate       Compensation       AllianceBernstein    AllianceBernstein  
                      Compensation    from the           Fund Complex,        Fund Complex,      
                      from the Fund   AllianceBernstein  Including the        Including the Fund,
                      for the Fiscal  Fund Complex,      Fund, as to which    as to which the    
                      Year Ended      Including          the Director is a    Director is a      
Name of Director      10/31/10        the Fund           Director or Trustee  Director or Trustee
----------------      ------------    -----------------  -------------------  -------------------
                                                                                                 
John H. Dobkin        $5,664          $236,900                33                   96            
Michael J. Downey     $5,664          $236,900                33                   96            
William H. Foulk, Jr. $10,647         $482,300                34                   97            
D. James Guzy         $5,664          $236,900                33                   96            
Nancy P. Jacklin      $5,664          $236,900                33                   96            
Robert M. Keith       $    0          $      0                34                   97            
Garry L. Moody        $6,484          $264,900                33                   96            
Marshall C. Turner    $5,664          $236,900                33                   96            
Earl D. Weiner        $6,092          $254,900                33                   96            

          As of January 4, 2011, the Directors and officers of the Fund as a
group owned less than 1% of the shares of the Fund.                             

ALLIANCEBERNSTEIN GLOBAL BOND FUND, INC.

                                                        [Enlarge/Download Table]


                                                         Total Number of      Total Number of    
                                                         Investment           Investment Funds   
                                      Total              Companies in the     within the         
                      Aggregate       Compensation       AllianceBernstein    AllianceBernstein  
                      Compensation    from the           Fund Complex,        Fund Complex,      
                      from the Fund   AllianceBernstein  Including the        Including the Fund,
                      for the Fiscal  Fund Complex,      Fund, as to which    as to which the    
                      Year Ended      Including          the Director is a    Director is a      
Name of Director      10/31/10        the Fund           Director or Trustee  Director or Trustee
----------------      ------------    -----------------  -------------------  -------------------
                                                                                                 
John H. Dobkin        $5,661          $236,900                33                   96            
Michael J. Downey     $5,661          $236,900                33                   96            
William H. Foulk, Jr. $10,644         $482,300                34                   97            
D. James Guzy         $5,661          $236,900                33                   96            
Nancy P. Jacklin      $5,661          $236,900                33                   96            
Robert M. Keith       $    0          $      0                34                   97            
Garry L. Moody        $6,482          $264,900                33                   96            
Marshall C. Turner    $5,661          $236,900                33                   96            
Earl D. Weiner        $6,090          $254,900                33                   96            

          As of January 4, 2011, the Directors and officers of the Fund as a
group owned less than 1% of the shares of the Fund.                             

ALLIANCEBERNSTEIN HIGH INCOME FUND, INC.

                                                        [Enlarge/Download Table]


                                                         Total Number of      Total Number of    
                                                         Investment           Investment Funds   
                                      Total              Companies in the     within the         
                      Aggregate       Compensation       AllianceBernstein    AllianceBernstein  
                      Compensation    from the           Fund Complex,        Fund Complex,      
                      from the Fund   AllianceBernstein  Including the        Including the Fund,
                      for the Fiscal  Fund Complex,      Fund, as to which    as to which the    
                      Year Ended      Including          the Director is a    Director is a      
Name of Director      10/31/10        the Fund           Director or Trustee  Director or Trustee
----------------      ------------    -----------------  -------------------  -------------------
                                                                                                 
John H. Dobkin        $5,664          $236,900                33                    96           
Michael J. Downey     $5,664          $236,900                33                    96           
William H. Foulk, Jr. $10,647         $482,300                34                    97           
D. James Guzy         $5,664          $236,900                33                    96           
Nancy P. Jacklin      $5,664          $236,900                33                    96           
Robert M. Keith       $    0          $      0                34                    97           
Garry L. Moody        $6,484          $264,900                33                    96           
Marshall C. Turner    $5,664          $236,900                33                    96           
Earl D. Weiner        $6,093          $254,900                33                    96           

          As of January 4, 2011, the Directors and officers of the Fund as a
group owned less than 1% of the shares of the Fund.                             

--------------------------------------------------------------------------------

EXPENSES OF THE FUNDS 

--------------------------------------------------------------------------------

Distribution Services Agreement                                                 
-------------------------------                                                 

         Each Fund has entered into a Distribution Services Agreement (the
"Agreement") with ABI, the Fund's principal underwriter, to permit ABI to       
distribute the Fund's shares and to permit the Fund to pay distribution services
fees to defray expenses associated with distribution of its Class A shares,     
Class B shares, Class C shares, Class R shares and Class K shares in accordance 
with a plan of distribution that is included in the Agreement and that has been 
duly adopted and approved in accordance with Rule 12b-1 adopted by the          
Commission under the 1940 Act (the "Plan").                                     

      The Plan is in compliance with rules of the Financial Industry
Regulatory Authority ("FINRA"), which effectively limit the annual asset-based  
sales charges and service fees that a mutual fund may pay on a class of shares  
to .75% and .25%, respectively, of the average annual net assets attributable to
that class. The rules also limit the aggregate of all front-end, deferred and   
asset-based sales charges imposed with respect to a class of shares by a mutual 
fund that also charges a service fee to 6.25% of cumulative gross sales of      
shares of that class, plus interest at the prime rate plus 1% per annum.        

         In approving the Plan, the Directors of each Fund determined that
there was a reasonable likelihood that the Plan would benefit the Funds and its 
shareholders. The distribution services fee of a particular class will not be   
used to subsidize the provision of distribution services with respect to any    
other class.                                                                    

        The Adviser may from time to time and from its own funds or such
other resources as may be permitted by rules of the Commission make payments for
distribution services to ABI; the latter may in turn pay part or all of such    
compensation to brokers or other persons for their distribution assistance.     

           The Plan will continue in effect with respect to each Fund and each
class of shares thereof for successive one-year periods provided that each such 
continuance is specifically approved at least annually by a majority of the     
Independent Directors of the Funds who have no direct or indirect financial     
interest in the operation of the Plan or any agreement related thereto (the     
"Qualified Directors") and by a vote of a majority of the entire Board cast in  
person at a meeting called for that purpose. Most recently, the Directors       
approved the continuance of the Plan at their meetings held on November 2-4,    
2010.                                                                           

           All material amendments to the Agreement will become effective only
upon approval as provided in the preceding paragraph, and the Plan may not be   
amended in order to increase materially the costs that the Fund may bear        
pursuant to the Agreement without the approval of a majority of the holders of  
the outstanding voting shares of the Fund or the class or classes of the Fund   
affected. The Agreement may be terminated (a) by the Fund without penalty at any
time by a majority vote of the holders of the Fund's outstanding voting         
securities, voting separately by class, or by a majority vote of the Qualified  
Directors or (b) by ABI. To terminate the Agreement, any party must give the    
other parties 60 days' written notice; to terminate the Plan only, the Fund is  
not required to give prior notice to ABI. The Agreement will terminate          
automatically in the event of its assignment. The Rule 12b-1 Plan is of a type  
known as a "reimbursement plan", which means that it reimburses the distributor 
for the actual costs of services rendered.                                      

       In the event that the Plan is terminated by either party or not
continued with respect to the Class A, Class B, Class C, Class R or Class K     
shares, (i) no distribution services fees (other than current amounts accrued   
but not yet paid) would be owed by the Fund to ABI with respect to that class   
and (ii) the Fund would not be obligated to pay ABI for any amounts expended    
under the Agreement not previously recovered by ABI from distribution services  
fees in respect of shares of such class or through deferred sales charges.      

            During the fiscal year ended October 31, 2010 for Intermediate Bond,
Unconstrained Bond and High Income and during the fiscal year ended September   
30, 2010 for Global Bond, with respect to Class A shares, the distribution      
services fees for expenditures payable to ABI amounted to $1,238,084, $132,273, 
$2,894,475 and $4,713,156, respectively, which constituted .30%, .30%, .30%, and
..30%, annually, of the respective Fund's aggregate average daily net assets    
attributable to Class A shares during the fiscal year. The Adviser made payments
from its own resources aggregating $308,722, $111,072, $1,930,737, and          
$1,794,904, respectively.                                                       

         For the fiscal year ended October 31, 2010 for Intermediate Bond,
Unconstrained Bond and High Income and during the fiscal year ended September   
30, 2010 for Global Bond, expenses incurred by each Fund and costs allocated to 
each Fund in connection with activities primarily intended to result in the sale
of Class A shares were as follows:                                              

Category of         Intermediate   Unconstrained                                
Expense             Bond           Bond          High Income   Global Bond      
-----------         ------------   -----------   -----------   -----------      

Advertising         $        0     $      0      $        0    $        0       

Printing and                                                                    
Mailing of                                                                      
Prospectuses to                                                                 
Persons Other                                                                   
Than Current                                                                    
Shareholders        $      822     $    424      $    2,539    $    1,803       

Compensation                                                                    
to Broker-                                                                      
Dealers and                                                                     
Other Financial                                                                 
Intermediaries                                                                  
(excluding ABI)     $1,166,583     $144,785      $3,078,130    $4,634,379       

Compensation                                                                    
to ABI              $  145,764     $ 39,817      $  266,583    $  398,048       

Compensation                                                                    
to Sales                                                                        
Personnel           $   39,623     $  4,655      $1,129,501    $  960,274       

Other (includes                                                                 
printing of                                                                     
sales literature,                                                               
travel,                                                                         
entertainment,                                                                  
due diligence                                                                   
and other                                                                       
promotional                                                                     
expenses)           $  194,014     $ 53,664      $  348,459    $  513,556       

Totals              $1,546,806     $243,345      $4,825,212    $6,508,060       

            During the fiscal year ended October 31, 2010 for Intermediate Bond,
Unconstrained Bond and High Income and during the fiscal year ended September   
30, 2010 for Global Bond, with respect to Class B shares, the distribution      
services fees for expenditures payable to ABI amounted to $187,771, $50,104,    
$459,076, and $904,168, respectively, which constituted 1.00%, 1.00%, 1.00%, and
1.00%, annually, of the respective Fund's aggregate average daily net assets    
attributable to Class B shares during the fiscal year. The Adviser made payments
from its own resources aggregating $0, $0, $0, and $0, respectively. For        
Intermediate Bond, Unconstrained Bond, High Income and Global Bond, $131,851,   
$43,403, $353,743 and $708,135, respectively, were used to offset the           
distribution services fees paid in prior years.                                 

         For the fiscal year ended October 31, 2010 for Intermediate Bond,
Unconstrained Bond and High Income and during the fiscal year ended September   
30, 2010 for Global Bond, expenses incurred by each Fund and costs allocated to 
each Fund in connection with activities primarily intended to result in the sale
of Class B shares were as follows:                                              

Category of         Intermediate   Unconstrained                                
Expense             Bond           Bond          High Income   Global Bond      
-----------         ------------   -----------   -----------   -----------      

Advertising         $     0        $      0      $        0    $        0       

Printing and                                                                    
Mailing of                                                                      
Prospectuses to                                                                 
Persons Other                                                                   
Than Current                                                                    
Shareholders        $       47     $     62      $       73    $      105       

Compensation                                                                    
to Broker-                                                                      
Dealers and                                                                     
Other Financial                                                                 
Intermediaries                                                                  
(excluding ABI)     $   48,582     $  6,232      $  102,130    $  190,002       

Compensation                                                                    
to ABI              $    2,804     $    166      $      522    $    1,242       

Compensation                                                                    
to Sales                                                                        
Personnel           $      794     $     20      $    1,922    $    3,083       

Interest on                                                                     
Financing           $        0     $      0      $        0    $        0       

Other (includes                                                                 
printing of                                                                     
sales literature,                                                               
travel,                                                                         
entertainment,                                                                  
due diligence                                                                   
and other                                                                       
promotional                                                                     
expenses)           $    3,693     $    221      $      686    $    1,601       

Totals              $   55,920     $  6,701      $  105,333    $  196,033       

            During the fiscal year ended October 31, 2010 for Intermediate Bond,
Unconstrained Bond and High Income and during the fiscal year ended September   
30, 2010 for Global Bond, with respect to Class C shares, the distribution      
services fees for expenditures payable to ABI amounted to $637,316, $138,650,   
$3,436,523, and $6,098,126, respectively, which constituted 1.00%, 1.00%, 1.00%,
and 1.00%, annually, of the respective Fund's aggregate average daily net assets
attributable to Class C shares during the fiscal year. The Adviser made payments
from its own resources aggregating $118,948, $54,515, $1,858,690, and $672,233, 
respectively. For Global Bond, $0 was used to offset the distribution service   
fees paid in prior years.                                                       

         For the fiscal year ended October 31, 2010 for Intermediate Bond,
Unconstrained Bond and High Income and during the fiscal year ended September   
30, 2010 for Global Bond, expenses incurred by each Fund and costs allocated to 
each Fund in connection with activities primarily intended to result in the sale
of Class C shares were as follows:                                              

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Category of         Intermediate   Unconstrained                                
Expense             Bond           Bond          High Income   Global Bond      
-----------         ------------   -----------   -----------   -----------      

Advertising         $        0     $      0      $        0    $        0       

Printing and                                                                    
Mailing of                                                                      
Prospectuses to                                                                 
Persons Other                                                                   
Than Current                                                                    
Shareholders        $      206     $    110      $      817    $      430       

Compensation                                                                    
to Broker-                                                                      
Dealers and                                                                     
Other Financial                                                                 
Intermediaries                                                                  
(excluding ABI)     $  654,645     $126,737      $4,532,256    $6,130,331       

Compensation                                                                    
to ABI              $   39,294     $ 26,890      $  110,988    $  135,322       

Compensation                                                                    
to Sales                                                                        
Personnel           $   10,922     $  3,422      $  506,603    $  329,285       

Interest on                                                                     
Financing           $        0     $      0      $        0    $        0       

Other (includes                                                                 
printing of                                                                     
sales literature,                                                               
travel,                                                                         
entertainment,                                                                  
due diligence                                                                   
and other                                                                       
promotional                                                                     
expenses)           $   51,197     $ 36,006      $  144,549    $  174,991       

Totals              $  756,264     $193,165      $5,295,213    $6,770,359       

            During the fiscal year ended October 31, 2010 for Intermediate Bond,
Unconstrained Bond and High Income and during the fiscal year ended September   
30, 2010 for Global Bond, with respect to Class R, shares, the distribution     
services fees for expenditures payable to ABI amounted to $1,949, $2,204,       
$38,462, and $35,959, respectively, which constituted .50%, .50%, .50%, and     
..50%, annually, of the respective Fund's aggregate average daily net assets    
attributable to Class R shares during the fiscal year. The Adviser made payments
from its own resources aggregating $11,688, $4,230, $35,617, and $29,630,       
respectively.                                                                   

         For the fiscal year ended October 31, 2010 for Intermediate Bond,
Unconstrained Bond and High Income and during the fiscal year ended September   
30, 2010 for Global Bond, expenses incurred by each Fund and costs allocated to 
each Fund in connection with activities primarily intended to result in the sale
of Class R shares were as follows:                                              

Category of         Intermediate   Unconstrained                                
Expense             Bond           Bond          High Income   Global Bond      
-----------         ------------   -----------   -----------   -----------      

Advertising         $        2     $      3      $        6    $        0       

Printing and                                                                    
Mailing of                                                                      
Prospectuses to                                                                 
Persons Other                                                                   
Than Current                                                                    
Shareholders        $       24     $      8      $       17    $        0       

Compensation                                                                    
to Broker-                                                                      
Dealers and                                                                     
Other Financial                                                                 
Intermediaries                                                                  
(excluding ABI)     $    4,183     $  3,092      $   40,114    $   41,105       

Compensation                                                                    
to ABI              $    3,506     $  1,335      $    3,398    $    6,073       

Compensation                                                                    
to Sales                                                                        
Personnel           $    1,484     $    241      $   20,006    $   16,603       

Interest on                                                                     
Financing           $        0     $      0      $        0    $        0       

Other (includes                                                                 
printing of                                                                     
sales literature,                                                               
travel,                                                                         
entertainment,                                                                  
due diligence                                                                   
and other                                                                       
promotional                                                                     
expenses)           $    4,438     $  1,755      $    4,551    $    7,795       

Totals              $   13,637     $  6,434      $   68,092    $   71,576       

            During the fiscal year ended October 31, 2010 for Intermediate Bond,
Unconstrained Bond and High Income and during the fiscal year ended September   
30, 2010 for Global Bond, with respect to Class K shares, the distribution      
services fees for expenditures payable to ABI amounted to $11,031, $100, $3,611,
and $1,799, respectively, which constituted .25%, .25%, .25%, and .25%,         
annually, of the respective Fund's aggregate average daily net assets           
attributable to Class K shares during the fiscal year. The Adviser made payments
from its own resources aggregating $5,566, $47, $702, and $4,724, respectively. 
For Intermediate Bond, $0 was used to offset the distribution services fees paid
in prior years. For Global Bond, $0 was used to offset the distribution service 
fees paid in prior years.                                                       

         For the fiscal year ended October 31, 2010 for Intermediate Bond,
Unconstrained Bond and High Income and during the fiscal year ended September   
30, 2010 for Global Bond, expenses incurred by each Fund and costs allocated to 
each Fund in connection with activities primarily intended to result in the sale
of Class K shares were as follows:                                              

Category of         Intermediate   Unconstrained                                
Expense             Bond           Bond          High Income   Global Bond      
-----------         ------------   -----------   -----------   -----------      

Advertising         $        0     $      0      $        0    $        0       

Printing and                                                                    
Mailing of                                                                      
Prospectuses to                                                                 
Persons Other                                                                   
Than Current                                                                    
Shareholders        $        8     $      0      $        4    $        0       

Compensation                                                                    
to Broker-                                                                      
Dealers and                                                                     
Other Financial                                                                 
Intermediaries                                                                  
(excluding ABI)     $   12,410     $    114      $    3,764    $    1,928       

Compensation                                                                    
to ABI              $    1,659     $     15      $      130    $      131       

Compensation                                                                    
to Sales                                                                        
Personnel           $      355     $      0      $    4,278    $      278       

Interest on                                                                     
Financing  `        $        0     $      0      $        0    $        0       

Other (includes                                                                 
printing of                                                                     
sales literature,                                                               
travel,                                                                         
entertainment,                                                                  
due diligence                                                                   
and other                                                                       
promotional                                                                     
expenses)           $    2,165     $     18      $      159    $      164       

Totals              $   16,597     $    147      $    8,335    $    2,501       

         Distribution services fees are accrued daily and paid monthly and
charged as expenses of each Fund as accrued. The distribution services fees     
attributable to the Class B, Class C, Class R and Class K shares are designed to
permit an investor to purchase such shares through broker-dealers without the   
assessment of an initial sales charge and at the same time to permit ABI to     
compensate broker-dealers in connection with the sale of such shares. In this   
regard the purpose and function of the combined contingent deferred sales charge
("CDSC") and respective distribution services fee on the Class B shares and     
Class C shares and distribution services fees on the Class R shares and the     
Class K shares are the same as those of the initial sales charge and            
distribution services fee with respect to the Class A shares in that in each    
case the sales charge and/or distribution services fee provide for the financing
of the distribution of the relevant class of the Fund's shares.                 

          With respect to Class A shares of each Fund, distribution expenses
accrued by ABI in one fiscal year may not be paid from distribution services    
fees received from the Fund in subsequent fiscal years. ABI's compensation with 
respect to Class B, Class C, Class R and Class K shares under the Plan is       
directly tied to the expenses incurred by ABI. Actual distribution expenses for 
Class B, Class C, Class R and Class K shares for any given year, however, will  
probably exceed the distribution services fees payable under the Plan with      
respect to the class involved and, in the case of Class B and Class C shares,   
payments received from CDSCs. The excess will be carried forward by ABI and     
reimbursed from distribution services fees payable under the Plan with respect  
to the class involved and, in the case of Class B and Class C shares, payments  
subsequently received through CDSCs, so long as the Plan is in effect.          

         For the fiscal year ended October 31, 2010 for Intermediate Bond,
Unconstrained Bond and High Income and during the fiscal year ended September   
30, 2010 for Global Bond, unreimbursed distribution expenses incurred and       
carried over of reimbursement in future years in respect of the Class B, Class  
C, Class R and Class K shares of each Fund were as follows:                     

Intermediate   Unconstrained    
Class                   Bond           Bond          High Income   Global Bond  
-----                   ------------   -----------   -----------   -----------  

Class B                 $      0       $8,391,025   $ 6,310,714    $26,325,583  
(% of the net                                                             
  assets of Class B)          0%          217.60%        15.74%         32.51%

Class C                 $756,828       $1,964,833   $ 5,809,290    $12,039,783  
(% of the net                                                             
  assets of Class C)       1.14%           14.84%         1.07%          1.76%

Class R                 $ 74,815       $   24,090   $    37,971    $    42,946  
(% of the net                                                             
  assets of Class R)       9.86%            4.67%          .29%           .36%

Class K                 $ 27,717       $   12,967   $     9,945    $     2,042  
(% of the net                                                             
  assets of Class K)        .64%            6.33%          .61%           .16%

Transfer Agency Agreement                                                       
-------------------------                                                       

         ABIS, an indirect wholly-owned subsidiary of the Adviser, located
principally at 8000 IH 10 W, 4th Floor, San Antonio, Texas 78230, acts as the   
Fund's registrar, transfer agent and dividend-disbursing agent for a fee based  
upon the number of account holders for each of the Class A, Class B, Class C,   
Class R, Class K, Class I and Advisor Class shares of the Funds plus            
reimbursement for out-of-pocket expenses. The transfer agency fee with respect  
to the Class B shares and Class C shares is higher than the transfer agency fee 
with respect to the Class A, Class R, Class K, Class I and Advisor Class shares.
For the fiscal year ended October 31, 2010 for Intermediate Bond, Unconstrained 
Bond and High Income and for the fiscal year ended September 30, 2010 for Global
Bond, the Fund paid ABIS $552,804, $42,536, $737,115 and $1,095,554,            
respectively, for transfer agency services.                                     

         ABIS acts as the transfer agent for each Fund. ABIS registers the
transfer, issuance and redemption of Fund shares and disburses dividends and    
other distributions to Fund shareholders.                                       

         Many Fund shares are owned by selected dealers or selected agents
(as defined below), financial intermediaries or other financial representatives 
("financial intermediaries") for the benefit of their customers. In those cases,
the Funds often do not maintain an account for you. Thus, some or all of the    
transfer agency functions for these accounts are performed by the financial     
intermediaries. Each Fund, ABI and/or the Adviser pay to these financial        
intermediaries, including those that sell shares of the AllianceBernstein Mutual
Funds, fees for sub-accounting or shareholder servicing in amounts ranging up to
$19 per customer fund account per annum. Retirement plans may also hold Fund    
shares in the name of the plan, rather than the participant. Plan recordkeepers,
who may have affiliated financial intermediaries who sell shares of the Fund,   
may be paid for each plan participant fund account in amounts up to $19 per     
account per annum and/or up to 0.25% per annum of the average daily assets held 
in the plan. To the extent any of these payments for sub-accounting or          
shareholder servicing or retirement plan accounts are made by the Fund, they are
included in your Prospectus in the Fund expense tables under "Fees and Expenses 
of the Funds." In addition, financial intermediaries may be affiliates of       
entities that receive compensation from the Adviser or ABI for maintaining      
retirement plan "platforms" that facilitate trading by affiliated and           
non-affiliated financial intermediaries and recordkeeping for retirement plans. 

           Because financial intermediaries and plan recordkeepers may be paid
varying amounts per class for sub-accounting or shareholder servicing, the      
service requirements of which may also vary by class, this may create an        
additional incentive for financial intermediaries and their financial advisors  
to favor one fund complex over another or one class of shares over another.     

Code of Ethics and Proxy Voting and Procedures                                  
----------------------------------------------                                  

        The Funds, the Adviser and ABI have each adopted codes of ethics
pursuant to Rule 17j-1 of the 1940 Act. These codes of ethics permit personnel  
subject to the codes to invest in securities, including securities that may be  
purchased or held by the Fund.                                                  

    Information regarding how each Fund voted proxies related to
portfolio securities during the most recent 12-month period ended June 30, 2010 
is available (1) without charge, upon request, by calling (800) 277-4618; or on 
or through the Fund's website at www.AllianceBernstein.com; or both; and (2) on 
the Commission's website at www.sec.gov.                                        

--------------------------------------------------------------------------------

PURCHASE OF SHARES

--------------------------------------------------------------------------------

    The following information supplements that set forth in your
Prospectus under the heading "Investing in the Funds."                          

           Effective January 31, 2009, sales of Class B shares of the Funds to
new investors were suspended. Class B shares are only issued (i) upon the       
exchange of Class B shares from another AllianceBernstein Fund, (ii) for        
purposes of dividend reinvestment, (iii) through the Funds' Automatic Investment
Program for accounts that established the Program prior to January 31, 2009, and
(iv) for purchase of additional Class B shares by Class B shareholders as of    
January 31, 2009. The ability to establish a new Automatic Investment Program   
for accounts containing Class B shares was suspended as of January 31, 2009.    

General                                                                         
-------                                                                         

        Shares of the Funds are offered on a continuous basis at a price
equal to its NAV plus an initial sales charge at the time of purchase (the      
"Class A shares"), with a CDSC (the "Class B shares"), or without any initial   
sales charge and, as long as the shares are held for one year or more, without  
any CDSC (the "Class C shares"), to group retirement plans, as defined below,   
eligible to purchase Class R shares, without any initial sales charge or CDSC   
(the "Class R shares"), to group retirement plans eligible to purchase Class K  
shares, without any initial sales charge or CDSC (the "Class K shares"), to     
group retirement plans and certain investment advisory clients of, and certain  
other persons associated with, the Adviser and its affiliates eligible to       
purchase Class I shares, without any initial sales charge or CDSC (the "Class I 
shares"), or to investors eligible to purchase Advisor Class shares, without any
initial sales charge or CDSC (the "Advisor Class shares"), in each case as      
described below. "Group retirement plans" are defined as 401(k) plans, 457      
plans, employer-sponsored 403(b) plans, profit sharing and money purchase       
pension plans, defined benefit plans, and non-qualified deferred compensation   
plans where plan level or omnibus accounts are held on the books of the Fund.   
All of the classes of shares of the Funds, except the Class I and Advisor Class 
shares, are subject to Rule 12b-1 asset-based sales charges. Shares of the Funds
that are offered subject to a sales charge are offered through (i) investment   
dealers that are members of FINRA and have entered into selected dealer         
agreements with ABI ("selected dealers"), (ii) depository institutions and other
financial intermediaries or their affiliates, that have entered into selected   
agent agreements with ABI ("selected agents") and (iii) ABI.                    

           Investors may purchase shares of the Funds either through financial
intermediaries or directly through ABI. A transaction, service, administrative  
or other similar fee may be charged by your financial intermediary with respect 
to the purchase, sale or exchange of shares made through the financial          
intermediary. Such financial intermediary may also impose requirements with     
respect to the purchase, sale or exchange of shares that are different from, or 
in addition to, those imposed by the Fund, including requirements as to the     
classes of shares available through that financial intermediary and the minimum 
initial and subsequent investment amounts. A Fund is not responsible for, and   
has no control over, the decision of any financial intermediary to impose such  
differing requirements. Sales personnel of financial intermediaries distributing
the Fund's Fund shares may receive differing compensation for selling different 
classes of shares.                                                              

            In order to open your account, a Fund or your financial intermediary
is required to obtain certain information from you for identification purposes. 
This information may include name, date of birth, permanent residential address 
and social security/taxpayer identification number. It will not be possible to  
establish your account without this information. If the Fund or your financial  
intermediary is unable to verify the information provided, your account may be  
closed, and other appropriate action may be taken as permitted by law.          

Frequent Purchases and Sales of Fund Shares                                     
-------------------------------------------                                     

         Each Fund's Board has adopted policies and procedures designed to
detect and deter frequent purchases and redemptions of Fund shares or excessive 
or short-term trading that may disadvantage long-term Fund shareholders. These  
policies are described below. There is no guarantee that the Funds will be able 
to detect excessive or short-term trading and to identify shareholders engaged  
in such practices, particularly with respect to transactions in omnibus         
accounts. Shareholders should be aware that application of these policies may   
have adverse consequences, as described below, and avoid frequent trading in    
Fund shares through purchases, sales and exchanges of shares. Each Fund reserves
the right to restrict, reject or cancel, without any prior notice, any purchase 
or exchange order for any reason, including any purchase or exchange order      
accepted by any shareholder's financial intermediary.                           

        Risks Associated With Excessive Or Short-Term Trading Generally.
While the Funds will try to prevent market timing by utilizing the procedures   
described below, these procedures may not be successful in identifying or       
stopping excessive or short-term trading in all circumstances. By realizing     
profits through short-term trading, shareholders that engage in rapid purchases 
and sales or exchanges of a Fund's shares dilute the value of shares held by    
long-term shareholders. Volatility resulting from excessive purchases and sales 
or exchanges of Fund shares, especially involving large dollar amounts, may     
disrupt efficient portfolio management and cause a Fund to sell shares at       
inopportune times to accommodate redemptions relating to short-term trading. In 
particular, a Fund may have difficulty implementing its long-term investment    
strategies if it is forced to maintain a higher level of its assets in cash to  
accommodate significant short-term trading activity. In addition, a Fund may    
incur increased administrative and other expenses due to excessive or short-term
trading, including increased brokerage costs and realization of taxable capital 
gains.                                                                          

        Funds that may invest significantly in foreign securities may be
particularly susceptible to short-term trading strategies. This is because      
foreign securities are typically traded on markets that close well before the   
time a Fund calculates its NAV at 4:00 p.m., Eastern time, which gives rise to  
the possibility that developments may have occurred in the interim that would   
affect the value of these securities. The time zone differences among           
international stock markets can allow a shareholder engaging in a short-term    
trading strategy to exploit differences in Fund share prices that are based on  
closing prices of foreign securities established some time before the Fund      
calculates its own share price (referred to as "time zone arbitrage"). The Funds
have procedures, referred to as fair value pricing, designed to adjust closing  
market prices of foreign securities to reflect what is believed to be the fair  
value of those securities at the time a Fund calculates its NAV. While there is 
no assurance, the Funds expect that the use of fair value pricing, in addition  
to the short-term trading policies discussed below, will significantly reduce a 
shareholder's ability to engage in time zone arbitrage to the detriment of other
Fund shareholders.                                                              

        A shareholder engaging in a short-term trading strategy may also
target a Fund that does not invest primarily in foreign securities. Any Fund    
that invests in securities that are, among other things, thinly traded, traded  
infrequently or relatively illiquid has the risk that the current market price  
for the securities may not accurately reflect current market values. A          
shareholder may seek to engage in short-term trading to take advantage of these 
pricing differences (referred to as "price arbitrage"). All Funds may be        
adversely affected by price arbitrage.                                          

       Policy Regarding Short-Term Trading. Purchases and exchanges of
shares of the Fund should be made for investment purposes only. The Funds will  
seek to prevent patterns of excessive purchases and sales or exchanges of Fund  
shares. The Funds seek to prevent such practices to the extent they are detected
by the procedures described below. The Funds reserve the right to modify this   
policy, including any surveillance or account blocking procedures established   
from time to time to effectuate this policy, at any time without notice.        

           o     Transaction Surveillance Procedures. The Funds, through their
             agents, ABI and ABIS, maintain surveillance procedures to
               detect excessive or short-term trading in Fund shares. This
                surveillance process involves several factors, which include
                scrutinizing transactions in Fund shares that exceed certain
              monetary thresholds or numerical limits within a specified
              period of time. Generally, more than two exchanges of Fund
          shares during any 90-day period or purchases of shares
                 followed by a sale within 90 days will be identified by these
              surveillance procedures. For purposes of these transaction
           surveillance procedures, the Funds may consider trading
                  activity in multiple accounts under common ownership, control,
             or influence. Trading activity identified by either, or a
              combination, of these factors, or as a result of any other
           information available at the time, will be evaluated to
                 determine whether such activity might constitute excessive or
            short-term trading. These surveillance procedures may be
              modified from time to time, as necessary or appropriate to
                  improve the detection of excessive or short-term trading or to
address specific circumstances.             

           o     Account Blocking Procedures. If the Funds determine, in their
                sole discretion, that a particular transaction or pattern of
           transactions identified by the transaction surveillance
                 procedures described above is excessive or short-term trading
               in nature, the relevant Fund account(s) will be immediately
                 "blocked" and no future purchase or exchange activity will be
                permitted. However, sales of Fund shares back to the Fund or
                redemptions will continue to be permitted in accordance with
            the terms of the Fund's current Prospectus. As a result,
               unless the shareholder redeems his or her shares, which may
                  have consequences if the shares have declined in value, a CDSC
             is applicable or adverse tax consequences may result, the
                 shareholder may be "locked" into an unsuitable investment. In
            the event an account is blocked, certain account-related
               privileges, such as the ability to place purchase, sale and
              exchange orders over the internet or by phone, may also be
              suspended. A blocked account will generally remain blocked
                 unless and until the account holder or the associated broker,
               dealer or other financial intermediary provides evidence or
                assurance acceptable to the Fund that the account holder did
        not or will not in the future engage in excessive or
short-term trading.                         

         o     Applications of Surveillance Procedures and Restrictions to
             Omnibus Accounts. Omnibus account arrangements are common
            forms of holding shares of the Funds, particularly among
                certain brokers, dealers and other financial intermediaries,
                 including sponsors of retirement plans and variable insurance
              products. The Funds apply their surveillance procedures to
                 these omnibus account arrangements. As required by Commission
                 rules, the Funds have entered into agreements with all of its
       financial intermediaries that require the financial
                intermediaries to provide the Funds, upon the request of the
        Funds or their agents, with individual account level
             information about their transactions. If the Funds detect
                 excessive trading through its monitoring of omnibus accounts,
          including trading at the individual account level, the
                financial intermediaries will also execute instructions from
                the Funds to take actions to curtail the activity, which may
          include applying blocks to accounts to prohibit future
                  purchases and exchanges of Fund shares. For certain retirement
                 plan accounts, the Funds may request that the retirement plan
           or other intermediary revoke the relevant participant's
           privilege to effect transactions in Fund shares via the
                 internet or telephone, in which case the relevant participant
             must submit future transaction orders via the U.S. Postal
Service (i.e., regular mail).               

            Risks to Shareholders Resulting From Imposition of Account Blocks in
Response to Excessive Short-Term Trading Activity. A shareholder identified as  
having engaged in excessive or short-term trading activity whose account is     
"blocked" and who may not otherwise wish to redeem his or her shares effectively
may be "locked" into an investment in a Fund that the shareholder did not intend
to hold on a long-term basis or that may not be appropriate for the             
shareholder's risk profile. To rectify this situation, a shareholder with a     
"blocked" account may be forced to redeem Fund shares, which could be costly if,
for example, these shares have declined in value, the shareholder recently paid 
a front-end sales charge or the shares are subject to a CDSC, or the sale       
results in adverse tax consequences to the shareholder. To avoid this risk, a   
shareholder should carefully monitor the purchases, sales, and exchanges of Fund
shares and avoid frequent trading in Fund shares.                               

      Limitations on Ability to Detect and Curtail Excessive Trading
Practices. Shareholders seeking to engage in excessive or short-term trading    
activities may deploy a variety of strategies to avoid detection and, despite   
the efforts of the Funds and their agents to detect excessive or short duration 
trading in Fund shares, there is no guarantee that the Fund will be able to     
identify these shareholders or curtail their trading practices. In particular,  
the Fund may not be able to detect excessive or short-term trading in Fund      
shares attributable to a particular investor who effects purchase and/or        
exchange activity in Fund shares through omnibus accounts. Also, multiple tiers 
of these entities may exist, each utilizing an omnibus account arrangement,     
which may further compound the difficulty of detecting excessive or short       
duration trading activity in Fund shares.                                       

Purchase of Shares                                                              
------------------                                                              

          A Fund reserves the right to suspend the sale of its shares to the
public in response to conditions in the securities markets or for other reasons.
If the Fund suspends the sale of its shares, shareholders will not be able to   
acquire its shares, including through an exchange.                              

          The public offering price of shares of a Fund is its NAV, plus, in
the case of Class A shares of the Fund, a sales charge. On each Fund business   
day on which a purchase or redemption order is received by the Fund and trading 
in the types of securities in which the Fund invests might materially affect the
value of the Fund's shares, the NAV per share is computed as of the next close  
of regular trading on the Exchange (currently 4:00 p.m., Eastern time) by       
dividing the value of the total assets attributable to a class, less its        
liabilities, by the total number of its shares then outstanding. A Fund business
day is any day on which the Exchange is open for trading.                       

            The respective NAVs of the various classes of shares of the Fund are
expected to be substantially the same. However, the NAVs of the Class B, Class C
and Class R shares of the Fund will generally be slightly lower than the NAVs of
the Class A, Class K, Class I and Advisor Class shares of the Fund, as a result 
of the differential daily expense accruals of the higher distribution and, in   
some cases, transfer agency fees applicable with respect to those classes of    
shares.                                                                         

    A Fund will accept unconditional orders for its shares to be
executed at the public offering price equal to its NAV next determined (plus    
applicable Class A sales charges), as described below. Orders received by ABI   
prior to the close of regular trading on the Exchange on each day the Exchange  
is open for trading are priced at the NAV computed as of the close of regular   
trading on the Exchange on that day (plus applicable Class A sales charges). In 
the case of orders for purchase of shares placed through financial              
intermediaries, the applicable public offering price will be the NAV as so      
determined, but only if the financial intermediary receives the order prior to  
the close of regular trading on the Exchange. The financial intermediary is     
responsible for transmitting such orders by a prescribed time to the Fund or its
transfer agent. If the financial intermediary fails to do so, the investor will 
not receive that day's NAV. If the financial intermediary receives the order    
after the close of regular trading on the Exchange, the price received by the   
investor will be based on the NAV determined as of the close of regular trading 
on the Exchange on the next day it is open for trading.                         

        A Fund may, at its sole option, accept securities as payment for
shares of the Fund if the Adviser believes that the securities are appropriate  
investments for the Fund. The securities are valued by the method described     
under "Net Asset Value" below as of the date the Fund receives the securities   
and corresponding documentation necessary to transfer the securities to the     
Portfolio. This is a taxable transaction to the shareholder.                    

          Following the initial purchase of the Fund's shares, a shareholder
may place orders to purchase additional shares by telephone if the shareholder  
has completed the appropriate portion of the Mutual Fund Application or an      
"Autobuy" application, both of which may be obtained by calling the "For        
Literature" telephone number shown on the cover of this SAI. Except with respect
to certain omnibus accounts, telephone purchase orders with payment by          
electronic funds transfer may not exceed $500,000. Payment for shares purchased 
by telephone can be made only by electronic funds transfer from a bank account  
maintained by the shareholder at a bank that is a member of the National        
Automated Clearing House Association ("NACHA"). Telephone purchase requests must
be received before 4:00 p.m., Eastern time, on a Fund business day to receive   
that day's public offering price. Telephone purchase requests received after    
4:00 p.m., Eastern time, are automatically placed the following Fund business   
day, and the applicable public offering price will be the public offering price 
determined as of the close of business on such following business day.          

          Full and fractional shares are credited to a shareholder's account
in the amount of his or her subscription. As a convenience, and to avoid        
unnecessary expense to the Fund, the Fund will not issue share certificates     
representing shares of the Fund. Ownership of the Fund's shares will be shown on
the books of the Fund's transfer agent. Lost certificates will not be replaced  
with another certificate, but will be shown on the books of the Fund's transfer 
agent. This facilitates later redemption and relieves the shareholder of the    
responsibility for and inconvenience of lost or stolen certificates.            

            Each class of shares of the Funds represents an interest in the same
portfolio of investments of the Fund, has the same rights and are identical in  
all respects, except that (i) Class A shares bear the expense of the initial    
sales charge (or CDSC, when applicable) and Class B shares and Class C shares   
bear the expense of the CDSC, (ii) Class B shares, Class C shares and Class R   
shares each bear the expense of a higher distribution services fee than that    
borne by Class A shares and Class K shares, and Class I shares and Advisor Class
shares do not bear such a fee, (iii) Class B shares and Class C shares bear     
higher transfer agency costs than those borne by Class A, Class R, Class K,     
Class I and Advisor Class shares, (iv) Class B shares are subject to a          
conversion feature and will convert to Class A shares under certain             
circumstances, and (v) each of Class A, Class B, Class C, Class R and Class K   
shares has exclusive voting rights with respect to provisions of the Plan       
pursuant to which its distribution services fee is paid and other matters for   
which separate class voting is appropriate under applicable law, provided that, 
if the Fund submits to a vote of the Class A shareholders, an amendment to the  
Plan that would materially increase the amount to be paid thereunder with       
respect to the Class A shares, then such amendment will also be submitted to the
Class B and Advisor Class shareholders because the Class B shares convert to    
Class A shares under certain circumstances, and the Class A shareholders and the
Class B shareholders will vote separately by class. Each class has different    
exchange privileges and certain different shareholder service options available.

    The Directors of the Funds have determined that currently no
conflict of interest exists between or among the classes of shares of the Funds.
On an ongoing basis, the Directors of the Funds, pursuant to their fiduciary    
duties under the 1940 Act and state law, will seek to ensure that no such       
conflict arises.                                                                

Alternative Purchase Arrangements                                               
---------------------------------                                               

           Classes A, B and C Shares. Class A, Class B and Class C shares have
the following alternative purchase arrangements: Class A shares are generally   
offered with an initial sales charge, Class B shares are generally offered with 
a CDSC and Class C shares are sold to investors choosing the asset--based sales 
charge alternative. Special purchase arrangements are available for group       
retirement plans. See "Alternative Purchase Arrangements - Group Retirement     
Plans and Tax-Deferred Accounts" below. These alternative purchase arrangements 
permit an investor to choose the method of purchasing shares that is most       
beneficial given the amount of the purchase, the length of time the investor    
expects to hold the shares and other circumstances. Investors should consider   
whether, during the anticipated life of their investment in the Fund, the       
accumulated distribution services fee and CDSC on Class B shares prior to       
conversion, or the accumulated distribution services fee and CDSC on Class C    
shares, would be less than the initial sales charge and accumulated distribution
services fee on Class A shares purchased at the same time, and to what extent   
such differential would be offset by the higher return of Class A shares. Class 
A shares will normally be more beneficial than Class B shares to the investor   
who qualifies for reduced initial sales charges on Class A shares, as described 
below. In this regard, ABI will reject any order (except orders from certain    
group retirement plans) for more than $100,000 for Class B shares (see          
"Alternative Purchase Arrangements - Group Retirement Plans and Tax-Deferred    
Accounts" below). Class C shares will normally not be suitable for the investor 
who qualifies to purchase Class A shares at NAV. For this reason, ABI will      
reject any order for more than $1,000,000 for Class C shares.                   

            Class A shares are subject to a lower distribution services fee and,
accordingly, pay correspondingly higher dividends per share than Class B shares 
or Class C shares. However, because initial sales charges are deducted at the   
time of purchase, most investors purchasing Class A shares would not have all   
their funds invested initially and, therefore, would initially own fewer shares.
Investors not qualifying for reduced initial sales charges who expect to        
maintain their investment for an extended period of time might consider         
purchasing Class A shares because the accumulated continuing distribution       
charges on Class B shares or Class C shares may exceed the initial sales charge 
on Class A shares during the life of the investment. Again, however, such       
investors must weigh this consideration against the fact that, because of such  
initial sales charges, not all their funds will be invested initially.          

       Other investors might determine, however, that it would be more
advantageous to purchase Class B shares or Class C shares in order to have all  
their funds invested initially, although remaining subject to higher continuing 
distribution charges and being subject to a CDSC for a three-year (four-year for
Unconstrained Bond) and one--year period, respectively. For example, based on   
current fees and expenses, an investor subject to the 4.25% initial sales charge
on Class A shares would have to hold his or her investment approximately seven  
years for the Class C distribution services fee to exceed the initial sales     
charge plus the accumulated distribution services fee of Class A shares. In this
example, an investor intending to maintain his or her investment for a longer   
period might consider purchasing Class A shares. This example does not take into
account the time value of money, which further reduces the impact of the Class C
distribution services fees on the investment, fluctuations in NAV or the effect 
of different performance assumptions.                                           

      Those investors who prefer to have all of their funds invested
initially but may not wish to retain Fund shares for the three-year (four-year  
for Intermediate Bond) period during which Class B shares are subject to a CDSC 
may find it more advantageous to purchase Class C shares.                       

          During the fiscal years ended October 31, 2008, 2009 and 2010, the
aggregate amount of underwriting commission payable with respect to shares of   
Intermediate Bond was $93,302, $264,102, $290,030, and $312,191, respectively.  
Of that amount ABI received amounts of $2,081, $15,528, and $18,946,            
respectively, representing that portion of the sales charges paid on shares of  
the Fund sold during the year which was not re-allowed to selected dealers (and 
was, accordingly, retained by ABI). During the Fund's fiscal years ended October
31, 2008, 2009, and 2010 ABI received CDSCs of $6,007, $9,011, and $5,611,      
respectively, on Class A shares, $29,523, $22,147, and $14,090, respectively, on
Class B shares, and $4,072, $7,965, and $2,650, respectively, on Class C shares.

          During the fiscal years ended October 31, 2008, 2009 and 2010, the
aggregate amount of underwriting commission payable with respect to shares of   
Unconstrained Bond was $119,895, $58,614, and $49,922, respectively. Of that    
amount, ABI received the amounts of $4,524, $4,029, and $3,898, respectively,   
representing that portion of the sales charges paid on shares of the Fund sold  
during the year which was not re-allowed to selected dealers (and was,          
accordingly, retained by ABI). During the Fund's fiscal years ended October 31, 
2008, 2009, and 2010, ABI received contingent deferred sales charges of $11,438,
$174, and $335, respectively, on Class A shares, $8,401, $15,233, and $7,148,   
respectively, on Class B shares, and $4,380, $2,058, and $2,830, respectively,  
on Class C shares.                                                              

            During the fiscal years ended September 30, 2008, 2009 and 2010, the
aggregate amount of underwriting commission payable with respect to shares of   
Global Bond was $3,619,264, $1,694,384 and $4,024,179, respectively. Of those   
amounts, ABI received the amounts of $219,813, $120,043 and $227,199,           
respectively, representing that portion of the sales charges paid on shares of  
the Fund sold during the year which was not re-allowed to selected dealers (and 
was, accordingly, retained by ABI). During the Fund's fiscal years ended        
September 30, 2008, 2009 and 2010, ABI received CDSCs of $44,147, $17,641 and   
$19,953, respectively, on Class A shares, $132,810, $176,422 and $85,631,       
respectively, on Class B shares and $134,516, $239,526 and $93,676,             
respectively, on Class C shares.                                                

          During the fiscal years ended October 31, 2008, 2009 and 2010, the
aggregate amount of underwriting commission payable with respect to shares of   
High Income was $562,420, $1,345,362 and $6,746,608, respectively. Of that      
amount, ABI received the amounts of $33,817, $110,108 and $389,705,             
respectively, representing that portion of the sales charges paid on shares of  
the Fund sold during the year which was not re-allowed to selected dealers (and 
was, accordingly, retained by ABI). During the Fund's fiscal years ended October
31, 2008, 2009 and 2010 ABI received CDSCs of $8,355, $4,164 and $20,571,       
respectively, on Class A shares, $50,423, $33,146 and $40,972, respectively, on 
Class B shares, and $21,648, $26,574 and $100,269, respectively, on Class C     
shares.                                                                         

Class A Shares                                                                  
--------------                                                                  

           The public offering price of Class A shares is the NAV plus a sales
charge, as set forth below.                                                     

Sales Charge
------------

                                                             Discount or
                                                               Commission to
                                                            Dealers or
                                                As % of the      Agents of up to
                            As % of Net       Public           % of Offering
Amount of Purchase            Amount Invested   Offering Price   Price          
------------------            ---------------   --------------   ---------------
Up to $100,000...............     4.44%             4.25%              4.00%    
$100,000 up to $250,000......     3.36              3.25               3.00     
$250,000 up to $500,000......     2.30              2.25               2.00     
$500,000 up to $1,000,000*...     1.78              1.75               1.50     

--------                                                                        
*     There is no initial sales charge on transactions of $1,000,000 or more.   

        All or a portion of the initial sales charge may be paid to your
financial representative. With respect to purchases of $1,000,000 or more, Class
A shares redeemed within one year of purchase may be subject to a CDSC of up to 
1%. The CDSC on Class A shares will be waived on certain redemptions, as        
described below under "--Contingent Deferred Sales Charge."                     

       No initial sales charge is imposed on Class A shares issued (i)
pursuant to the automatic reinvestment of income dividends or capital gains     
distributions, (ii) in exchange for Class A shares of other AllianceBernstein   
Mutual Funds (as that term is defined under "Combined Purchase Privilege"       
below), except that an initial sales charge will be imposed on Class A shares   
issued in exchange for Class A shares of AllianceBernstein Exchange Reserves    
that were purchased for cash without the payment of an initial sales charge and 
without being subject to a CDSC, or (iii) upon the automatic conversion of Class
B shares as described below under "--Class B Shares--Conversion Feature". A Fund
receives the entire NAV of its Class A shares sold to investors. ABI's          
commission is the sales charge shown in the Prospectus less any applicable      
discount or commission reallowed to selected dealers and agents. ABI will       
reallow discounts to selected dealers and agents in the amounts indicated in the
table above. In this regard, ABI may elect to reallow the entire sales charge to
selected dealers and agents for all sales with respect to which orders are      
placed with ABI. A selected dealer who receives reallowance in excess of 90% of 
such a sales charge may be deemed to be an "underwriter" under the Securities   
Act.                                                                            

          In addition to the circumstances described above, certain types of
investors may be entitled to pay no initial sales charge in certain             
circumstances described below.                                                  

            Class A Shares - Sales at NAV. A Fund may sell its Class A shares at
NAV (i.e., without any initial sales charge) to certain categories of investors 
including:                                                                      

 (i)   investment management clients of the Adviser or its
                affiliates, including clients and prospective clients of the
        Adviser's AllianceBernstein Institutional Investment
Management Division;                        

           (ii)  officers and present or former Directors of the Fund or other
          investment companies managed by the Adviser, officers,
            directors and present or retired full-time employees and
           former employees (for subsequent investment in accounts
             established during the course of their employment) of the
                Adviser, ABI, ABIS and their affiliates; officers, directors
              and present and full-time employees of selected dealers or
              agents; or the spouse or domestic partner, sibling, direct
                ancestor or direct descendant (collectively, "relatives") of
                any such person; or any trust, individual retirement account
                  or retirement plan account for the benefit of any such person;

           (iii) the Adviser, ABI, ABIS and their affiliates; certain employee
             benefit plans for employees of the Adviser, ABI, ABIS and
their affiliates;                           

         (iv)  persons participating in a fee-based program, sponsored and
               maintained by a registered broker-dealer or other financial
                  intermediary and approved by ABI, under which such persons pay
              an asset-based fee for service in the nature of investment
advisory or administrative services;        

 (v)   certain retirement plan accounts as described under
               "Alternative Purchase Arrangements - Group Retirement Plans
and Tax-Deferred Accounts"; and             

            (vi)  current Class A shareholders of AllianceBernstein Mutual Funds
            and investors who receive a "Fair Funds Distribution" (a
                  "Distribution") resulting from a Commission enforcement action
           against the Adviser and current Class A shareholders of
             AllianceBernstein Mutual Funds who receive a Distribution
               resulting from any Commission enforcement action related to
               trading in shares of AllianceBernstein Mutual Funds who, in
                  each case, purchase shares of an AllianceBernstein Mutual Fund
                from ABI through deposit with ABI of the Distribution check.

Class B Shares                                                                  
--------------                                                                  

           Effective January 31, 2009, sales of Class B shares of the Funds to
new investors were suspended. Class B shares are only issues (i) upon the       
exchange of Class B shares from another AllianceBernstein Fund, and (ii) for    
purposes of dividend reinvestment, (iii) through the Fund's Automatic Investment
Program for accounts that established the Program prior to January 31, 2009, and
(iv) for purchases of additional Class B shares by Class B shareholders as of   
January 31, 2009. The ability to establish a new Automatic Investment Program   
for accounts containing Class B shares was suspended as of January 31, 2009.    

          Investors may purchase Class B shares at the public offering price
equal to the NAV per share of the Class B shares on the date of purchase without
the imposition of a sales charge at the time of purchase. The Class B shares are
sold without an initial sales charge so that the Fund will receive the full     
amount of the investor's purchase payment.                                      

       Conversion Feature. For Intermediate Bond, Global Bond and High
Income, six years after the end of the calendar month in which the shareholder's
purchase order was accepted, Class B shares will automatically convert to Class 
A shares and will no longer be subject to a higher distribution services fee.   
For Unconstrained Bond, eight years after the end of the calendar month in which
the shareholder's purchase order was accepted, Class B shares will automatically
convert to Class A shares and will no longer be subject to a higher distribution
services fee. Such conversion will occur on the basis of the relative NAVs of   
the two classes, without the imposition of any sales load, fee or other charge. 
The purpose of the conversion feature is to reduce the distribution services fee
paid by holders of Class B shares that have been outstanding long enough for ABI
to have been compensated for distribution expenses incurred in the sale of the  
shares.                                                                         

    For purposes of conversion to Class A shares, Class B shares
purchased through the reinvestment of dividends and distributions paid in       
respect of Class B shares in a shareholder's account will be considered to be   
held in a separate sub-account. Each time any Class B shares in the             
shareholder's account (other than those in the sub-account) convert to Class A  
shares, an equal pro-rata portion of the Class B shares in the sub-account will 
also convert to Class A shares.                                                 

            The conversion of Class B shares to Class A shares is subject to the
continuing availability of an opinion of counsel to the effect that the         
conversion of Class B shares to Class A shares does not constitute a taxable    
event under federal income tax law. The conversion of Class B shares to Class A 
shares may be suspended if such an opinion is no longer available at the time   
such conversion is to occur. In that event, no further conversions of Class B   
shares would occur, and shares might continue to be subject to the higher       
distribution services fee for an indefinite period which may extend beyond the  
period ending six years after the end of the calendar month in which the        
shareholder's purchase order was accepted.                                      

Class C Shares                                                                  
--------------                                                                  

          Investors may purchase Class C shares at the public offering price
equal to the NAV per share of the Class C shares on the date of purchase without
the imposition of a sales charge either at the time of purchase or, as long as  
the shares are held for one year or more, upon redemption. Class C shares are   
sold without an initial sales charge so that the Fund will receive the full     
amount of the investor's purchase payment and, as long as the shares are held   
for one year or more, without a CDSC so that the investor will receive as       
proceeds upon redemption the entire NAV of his or her Class C shares. The Class 
C distribution services fee enables the Fund to sell Class C shares without     
either an initial sales charge or CDSC, as long as the shares are held for one  
year or more. Class C shares do not convert to any other class of shares of the 
Fund and incur higher distribution services fees and transfer agency costs than 
Class A shares and Advisor Class shares, and will thus have a higher expense    
ratio and pay correspondingly lower dividends than Class A shares and Advisor   
Class shares.                                                                   

          Contingent Deferred Sales Charge. Class B shares that are redeemed
within four years of purchase will be subject to a CDSC at the rates set forth  
below charged as a percentage of the dollar amount subject thereto. Class A     
share purchases of $1,000,000 or more and Class C shares that are redeemed      
within one year of purchase will be subject to a CDSC of 1%, as are Class A     
share purchases by certain group retirement plans (see "Alternative Purchase    
Arrangements -- Group Retirement Plans and Tax-Deferred Accounts" below). The   
charge will be assessed on an amount equal to the lesser of the cost of the     
shares being redeemed or their NAV at the time of redemption. Accordingly, no   
sales charge will be imposed on increases in NAV above the initial purchase     
price. In addition, no charge will be assessed on shares derived from           
reinvestment of dividends or capital gains distributions.                       

           To illustrate, assume that an investor purchased 100 Class B shares
at $10 per share (at a cost of $1,000) and in the second year after purchase,   
the NAV per share is $12 and, during such time, the investor has acquired 10    
additional Class B shares upon dividend reinvestment. If at such time the       
investor makes his or her first redemption of 50 Class B shares (proceeds of    
$600), 10 Class B shares will not be subject to the charge because of dividend  
reinvestment. With respect to the remaining 40 Class B shares, the charge is    
applied only to the original cost of $10 per share and not to the increase in   
NAV of $2 per share. Therefore, $400 of the $600 redemption proceeds will be    
charged at a rate of 3.0% (the applicable rate in the second year after purchase
as set forth below).                                                            

     For Class B shares, the amount of the CDSC, if any, will vary
depending on the number of years from the time of payment for the purchase of   
Class B shares until the time of redemption of such shares.                     

                                    Contingent Deferred Sales Charge
                                     for the Fund as a % of Dollar
Year Since Purchase                     Amount Subject to Charge    
-------------------                     ------------------------    
First                                              3.0%             
Second                                             2.0%             
Third                                              1.0%             
Thereafter                                         None             

         In determining the CDSC applicable to a redemption of Class B and
Class C shares, it will be assumed that the redemption is, first, of any shares 
that are not subject to a CDSC (for example, because the shares were acquired   
upon the reinvestment of dividends or distributions) and, second, of shares held
longest during the time they are subject to the sales charge. When shares       
acquired in an exchange are redeemed, the applicable CDSC and conversion        
schedules will be the schedules that applied at the time of the purchase of     
shares of the corresponding class of the AllianceBernstein Mutual Fund          
originally purchased by the shareholder. If you redeem your shares and directly 
invest the proceeds in units of CollegeBoundfund, the CDSC will apply to the    
units of CollegeBoundfund. The CDSC period begins with the date of your original
purchase, not the date of exchange for the other Class B shares or Class C      
shares, as applicable, or purchase of CollegeBoundfund units.                   

            Proceeds from the CDSC are paid to ABI and are used by ABI to defray
the expenses of ABI related to providing distribution-related services to the   
Fund in connection with the sale of Fund shares, such as the payment of         
compensation to selected dealers and agents for selling Fund shares. The        
combination of the CDSC and the distribution services fee enables the Fund to   
sell shares without a sales charge being deducted at the time of purchase.      

           The CDSC is waived on redemptions of shares (i) following the death
or disability, as defined in the United States Internal Revenue Code of 1986, as
amended (the "Code"), of a shareholder, (ii) to the extent that the redemption  
represents a minimum required distribution from an individual retirement account
or other retirement plan to a shareholder that has attained the age of 70 1/2,  
(iii) that had been purchased by present or former Directors of the Funds, by   
the relative of any such person, by any trust, individual retirement account or 
retirement plan account for the benefit of any such person or relative, or by   
the estate of any such person or relative, (iv) pursuant to, and in accordance  
with, a systematic withdrawal plan (see "Sales Charge Reduction                 
Programs--Systematic Withdrawal Plan" below), (v) to the extent that the        
redemption is necessary to meet a plan participant's or beneficiary's request   
for a distribution or loan from a group retirement plan or to accommodate a plan
participant's or beneficiary's direction to reallocate his or her plan account  
among other investment alternatives available under a group retirement plan,    
(vi) due to the complete termination of a trust upon the death of the           
trustor/grantor, beneficiary or trustee, but only if the trust termination is   
specifically provided for in the trust document, or (vii) that had been         
purchased with proceeds from a Distribution resulting from any Commission       
enforcement action related to trading in shares of AllianceBernstein Mutual     
Funds through deposit with ABI of the Distribution check. The CDSC is also      
waived for (i) permitted exchanges of shares, (ii) holders of Class A shares who
purchased $1,000,000 or more of Class A shares where the participating broker or
dealer involved in the sale of such shares waived the commission it would       
normally receive from ABI or (iii) Class C shares sold through programs offered 
by financial intermediaries and approved by ABI where such programs offer only  
shares that are not subject to a CDSC, where the financial intermediary         
establishes a single omnibus account for the Fund or in the case of a group     
retirement plan, a single account for each plan, and where no advance commission
is paid to any financial intermediary in connection with the purchase of such   
shares.                                                                         

Class R Shares                                                                  
--------------                                                                  

           Class R shares are offered only to group retirement plans that have
plan assets of up to $10 million. Class R shares are not available to retail    
non-retirement accounts, traditional or Roth IRAs, Coverdell Education Savings  
Accounts, SEPs, SAR-SEPs, SIMPLE IRAs, individual 403(b) plans and to           
AllianceBernstein sponsored retirement products. Class R shares incur a .50%    
distribution services fee and thus have a higher expense ratio than Class A     
shares, Class K shares and Class I shares and pay correspondingly lower         
dividends than Class A shares, Class K shares and Class I shares.               

Class K Shares                                                                  
--------------                                                                  

          Class K shares are available at NAV to group retirement plans that
have plan assets of at least $1 million. Class K shares generally are not       
available to retail non-retirement accounts, traditional and Roth IRAs,         
Coverdell Education Savings Accounts, SEPs, SAR-SEPs, SIMPLE IRAs, individual   
403(b) plans and AllianceBernstein sponsored retirement products. Class K shares
do not have an initial sales charge or CDSC but incur a .25% distribution       
services fee and thus (i) have a lower expense ratio than Class R shares and pay
correspondingly higher dividends than Class R shares and (ii) have a higher     
expense ratio than Class I shares and pay correspondingly lower dividends than  
Class I shares.                                                                 

Class I Shares                                                                  
--------------                                                                  

         Class I shares are available at NAV to all group retirement plans
that have plan assets in excess of $10 million, to certain related group        
retirement plans with plan assets of less than $10 million in assets if the     
sponsor of such plans has at least one group retirement plan with plan assets in
excess of $10 million that invests in Class I shares and to certain investment  
advisory clients of, and certain other persons associated with, the Adviser and 
its affiliates. Class I shares generally are not available to retail            
non-retirement accounts, traditional and Roth IRAs, Coverdell Education Savings 
Accounts, SEPs, SAR-SEPs, SIMPLE IRAs, individual 403(b) plans and              
AllianceBernstein sponsored retirement products. Class I shares do not incur any
distribution services fees and will thus have a lower expense ratio and pay     
correspondingly higher dividends than Class R and Class K shares.               

Advisor Class Shares                                                            
--------------------                                                            

         Advisor Class shares may be purchased and held solely (i) through
accounts established under fee-based programs, sponsored and maintained by      
registered broker-dealers or other financial intermediaries and approved by ABI,
(ii) through self-directed defined contribution employee benefit plans (e.g.,   
401(k) plans) that have at least $10 million in assets and are purchased        
directly by the plan without the involvement of a financial intermediary or     
(iii) by the categories of investors described in clauses (i) through (iv) under
"Class A Shares -- Sales at NAV" (other than officers, directors and present and
full-time employees of selected dealers or agents, or relatives of such person, 
or any trust, individual retirement account or retirement plan account for the  
benefit of such relative, none of whom is eligible on the basis solely of such  
status to purchase and hold Advisor Class shares). Generally, a fee-based       
program must charge an asset-based or other similar fee and must invest at least
$250,000 in Advisor Class shares of the Fund in order to be approved by ABI for 
investment in Advisor Class shares. A transaction fee may be charged by your    
financial intermediary with respect to the purchase, sale or exchange of Advisor
Class shares made through such financial intermediary. Advisor Class shares do  
not incur any distribution services fees, and will thus have a lower expense    
ratio and pay correspondingly higher dividends than Class A, Class B, Class C,  
Class R, or Class K shares.                                                     

Alternative Purchase Arrangements - Group Retirement Plans and Tax-Deferred     
Accounts                                                                        
---------------------------------------------------------------------------     

            A Fund offers special distribution arrangements for group retirement
plans. However, plan sponsors, plan fiduciaries and other financial             
intermediaries may establish requirements as to the purchase, sale or exchange  
of shares of the Fund, including maximum and minimum initial investment         
requirements, that are different from those described in this SAI. Group        
retirement plans also may not offer all classes of shares of the Fund. In order 
to enable participants investing through group retirement plans to purchase     
shares of the Fund, the maximum and minimum investment amounts may be different 
for shares purchased through group retirement plans from those described herein.
In addition, the Class A and Class B CDSC may be waived for investments made    
through certain group retirement plans. Therefore, plan sponsors or fiduciaries 
may not adhere to these share class eligibility standards as set forth in the   
Prospectuses and this SAI. A Fund is not responsible for, and has no control    
over, the decision of any plan sponsor or fiduciary to impose such differing    
requirements.                                                                   

  Class A Shares. Class A shares are available at NAV to all
AllianceBernstein sponsored group retirement plans, regardless of size, and to  
the AllianceBernstein Link, AllianceBernstein Individual 401(k) and             
AllianceBernstein SIMPLE IRA plans with at least $250,000 in plan assets or 100 
or more employees. Effective June 30, 2005, for purposes of determining whether 
a SIMPLE IRA plan has at least $250,000 in plan assets, all of the SIMPLE IRAs  
of an employer's employees are aggregated. ABI measures the asset levels and    
number of employees in these plans once monthly. Therefore, if a plan that is   
not initially eligible for Class A shares meets the asset level or number of    
employees required for Class A eligibility, ABI may not initially fill orders   
with Class A shares if an order is received prior to its monthly measurement of 
assets and employees. If the plan terminates the Fund as an investment option   
within one year, then all plan purchases of Class A shares will be subject to a 
1%, 1-year CDSC on redemption.                                                  

          Class A shares are also available at NAV to group retirement plans
with plan assets in excess of $10 million. The 1%, 1-year CDSC also generally   
applies. However, the 1%, 1-year CDSC may be waived if the financial            
intermediary agrees to waive all commissions or other compensation paid in      
connection with the sale of such shares (typically up to a 1% advance payment   
for sales of Class A shares at NAV) other than the service fee paid pursuant to 
the Fund's distribution service plan.                                           

      Class B Shares. Class B shares are generally not available for
purchase by group retirement plans. However, Class B shares may continue to be  
purchased by group retirement plans that have already selected Class B shares as
an investment alternative under their plan prior to September 2, 2003.          

         Class C Shares. Class C shares are available to AllianceBernstein
Link, AllianceBernstein Individual 401(k) and AllianceBernstein SIMPLE IRA plans
with less than $250,000 in plan assets and less than 100 employees. Class C     
shares are also available to group retirement plans with plan assets of less    
than $1 million. If an AllianceBernstein Link, AllianceBernstein Individual     
401(k) or AllianceBernstein SIMPLE IRA plan holding Class C shares becomes      
eligible to purchase Class A shares at NAV, the plan sponsor or other           
appropriate fiduciary of such plan may request ABI in writing to liquidate the  
Class C shares and purchase Class A shares with the liquidation proceeds. Any   
such liquidation and repurchase may not occur before the expiration of the      
1-year period that begins on the date of the plan's last purchase of Class C    
shares.                                                                         

     Class R Shares. Class R shares are available to certain group
retirement plans with plan assets of up to $10 million. Class R shares are not  
subject to a front-end sales charge or CDSC, but are subject to a .50%          
distribution fee.                                                               

     Class K Shares. Class K shares are available to certain group
retirement plans with plan assets of at least $1 million. Class K shares are not
subject to a front-end sales charge or CDSC, but are subject to a .25%          
distribution fee.                                                               

     Class I Shares. Class I shares are available to certain group
retirement plans with plan assets of at least $10 million and certain           
institutional clients of the Adviser who invest at least $2 million in a Fund.  
Class I shares are not subject to a front-end sales charge, CDSC or a           
distribution fee.                                                               

Choosing a Class of Shares for Group Retirement Plans                           
-----------------------------------------------------                           

          Plan sponsors, plan fiduciaries and other financial intermediaries
may establish requirements as to the purchase, sale or exchange of shares of the
Fund, including maximum and minimum initial investment requirements, that are   
different from those described in this SAI. Plan fiduciaries should consider how
these requirements differ from the Fund's share class eligibility criteria      
before determining whether to invest.                                           

         It is expected that the Funds will eventually offer only Class R,
Class K and Class I shares to group retirement plans. Currently, the Funds also 
make their Class A shares available at NAV to group retirement plans with plan  
assets in excess of $10 million. Unless waived under the circumstances described
above, a 1%, 1-year CDSC applies to the sale of Class A shares by a plan.       
Because Class K shares have no CDSC and lower 12b-1 distribution fees and Class 
I shares have no CDSC and Rule 12b-1 distribution fees, plans should consider   
purchasing Class K or Class I shares, if eligible, rather than Class A shares.  

         In selecting among the Class A, Class K and Class R shares, plans
purchasing shares through a financial intermediary that is not willing to waive 
advance commission payments (and therefore are not eligible for the waiver of   
the 1%, 1-year CDSC applicable to Class A shares) should weigh the following:   

   o     the lower Rule 12b-1 distribution fees (0.30%) and the 1%, 1-year
CDSC with respect to Class A shares;                    

      o     the higher Rule 12b-1 distribution fees (0.50%) and the absence of a
CDSC with respect to Class R shares; and                

     o     the lower Rule 12b-1 distribution fees (0.25%) and the absence of a
CDSC with respect to Class K shares.                    

Because Class A and Class K shares have lower Rule 12b-1
distribution fees than Class R shares, plans should consider purchasing Class A 
or Class K shares, if eligible, rather than Class R shares.                     

        As described above, effective January 31, 2009, sales of Class B
shares to new investors were suspended. While Class B were generally not        
available to group retirement plans, Class B shares are available for continuing
contributions from plans that have already selected Class B shares as an        
investment option under their plans prior to September 2, 2003. Plans should    
weigh the fact that Class B shares will convert to Class A shares after a period
of time against the fact that Class A, Class R, Class K and Class I shares have 
lower expenses, and therefore higher returns, than Class B shares, before       
determining which class to make available to its plan participants.             

Sales Charge Reduction Programs                                                 
-------------------------------                                                 

     The AllianceBernstein Mutual Funds offer shareholders various
programs through which shareholders may obtain reduced sales charges or         
reductions in CDSC through participation in such programs. In order for         
shareholders to take advantage of the reductions available through the combined 
purchase privilege, rights of accumulation and letters of intent, the Fund must 
be notified by the shareholder or his or her financial intermediary that they   
qualify for such a reduction. If the Fund is not notified that a shareholder is 
eligible for these reductions, the Fund will be unable to ensure that the       
reduction is applied to the shareholder's account.                              

           Combined Purchase Privilege. Shareholders may qualify for the sales
charge reductions by combining purchases of shares of a Fund into a single      
"purchase." By combining such purchases, shareholders may be able to take       
advantage of the quantity discounts described under "Alternative Purchase       
Arrangements - Class A Shares." A "purchase" means a single purchase or         
concurrent purchases of shares of a Fund or any other AllianceBernstein Mutual  
Fund, including AllianceBernstein Institutional Funds, by (i) an individual, his
or her spouse or domestic partner or the individual's children under the age of 
21 years purchasing shares for his, her or their own account(s), including      
certain CollegeBoundfund accounts; (ii) a trustee or other fiduciary purchasing 
shares for a single trust, estate or single fiduciary account with one or more  
beneficiaries involved; or (iii) the employee benefit plans of a single         
employer. The term "purchase" also includes purchases by any "company," as the  
term is defined in the 1940 Act, but does not include purchases by any such     
company that has not been in existence for at least six months or that has no   
purpose other than the purchase of shares of the Fund or shares of other        
registered investment companies at a discount. The term "purchase" does not     
include purchases by any group of individuals whose sole organizational nexus is
that the participants therein are credit card holders of a company, policy      
holders of an insurance company, customers of either a bank or broker-dealer or 
clients of an investment adviser.                                               

Currently, the AllianceBernstein Mutual Funds include:  

AllianceBernstein Balanced Shares, Inc.                                         
AllianceBernstein Blended Style Series, Inc.                                    
-AllianceBernstein 2000 Retirement Strategy                                   
-AllianceBernstein 2005 Retirement Strategy                                   
-AllianceBernstein 2010 Retirement Strategy                                   
-AllianceBernstein 2015 Retirement Strategy                                   
-AllianceBernstein 2020 Retirement Strategy                                   
-AllianceBernstein 2025 Retirement Strategy                                   
-AllianceBernstein 2030 Retirement Strategy                                   
-AllianceBernstein 2035 Retirement Strategy                                   
-AllianceBernstein 2040 Retirement Strategy                                   
-AllianceBernstein 2045 Retirement Strategy                                   
-AllianceBernstein 2050 Retirement Strategy                                   
-AllianceBernstein 2055 Retirement Strategy                                   
-U.S. Large Cap Portfolio                                                     
AllianceBernstein Bond Fund, Inc.                                               
-AllianceBernstein Bond Inflation Strategy                                    
-AllianceBernstein Intermediate Bond Portfolio                                
-AllianceBernstein Municipal Bond Inflation Strategy                            
-AllianceBernstein Real Asset Strategy                                          
AllianceBernstein Cap Fund, Inc.                                                
-AllianceBernstein Small Cap Growth Portfolio                                 
-AllianceBernstein U.S. Strategic Research Portfolio                        
-AllianceBernstein Market Neutral Strategy - U.S.                           
-AllianceBernstein Market Neutral Strategy - Global                         
-AllianceBernstein International Discovery Equity Portfolio                 
AllianceBernstein Core Opportunities Fund, Inc.                                 
AllianceBernstein Equity Income Fund, Inc.                                      
AllianceBernstein Exchange Reserves                                             
AllianceBernstein Global Bond Fund, Inc.                                        
AllianceBernstein Global Growth Fund, Inc.                                      
AllianceBernstein Global Real Estate Investment Fund, Inc.                      
AllianceBernstein Global Thematic Growth Fund, Inc.                             
AllianceBernstein Greater China '97 Fund, Inc.                                  
AllianceBernstein Growth and Income Fund, Inc.                                  
AllianceBernstein High Income Fund, Inc.                                        
AllianceBernstein International Growth Fund, Inc.                               
AllianceBernstein Large Cap Growth Fund, Inc.                                   
AllianceBernstein Municipal Income Fund, Inc.                                   
-AllianceBernstein High Income Municipal Portfolio                            
-California Portfolio                                                         
-National Portfolio                                                           
-New York Portfolio                                                           
AllianceBernstein Municipal Income Fund II                                      
-Arizona Portfolio                                                            
-Massachusetts Portfolio                                                      
-Michigan Portfolio                                                           
-Minnesota Portfolio                                                          
-New Jersey Portfolio                                                         
-Ohio Portfolio                                                               
-Pennsylvania Portfolio                                                       
-Virginia Portfolio                                                           
AllianceBernstein Small/Mid Cap Growth Fund, Inc.                               
AllianceBernstein Trust                                                         
-AllianceBernstein Global Value Fund                                          
-AllianceBernstein International Value Fund                                   
-AllianceBernstein Small/Mid Cap Value Fund                                   
-AllianceBernstein Value Fund                                                 
AllianceBernstein Unconstrained Bond Fund, Inc.                                 
The AllianceBernstein Portfolios                                                
-AllianceBernstein Balanced Wealth Strategy                                   
-AllianceBernstein Conservative Wealth Strategy                               
-AllianceBernstein Growth Fund                                                
-AllianceBernstein Tax-Managed Balanced Wealth Strategy                       
-AllianceBernstein Tax-Managed Wealth Appreciation Strategy                   
-AllianceBernstein Tax Managed Conservative Wealth Strategy                   
-AllianceBernstein Wealth Appreciation Strategy                               
Sanford C. Bernstein Fund, Inc.                                                 
-Intermediate California Municipal Portfolio                                  
-Intermediate Diversified Municipal Portfolio                                 
-Intermediate New York Municipal Portfolio                                    
-International Portfolio                                                      
-Overlay A Portfolio                                                        
-Overlay B Portfolio                                                        
-Short Duration Portfolio                                                   
-Tax-Aware Overlay A Portfolio                                              
-Tax-Aware Overlay B Portfolio                                              
-Tax-Aware Overlay C Portfolio                                              
-Tax-Aware Overlay N Portfolio                                              
-Tax-Managed International Portfolio                                        

           Prospectuses for the AllianceBernstein Mutual Funds may be obtained
without charge by contacting ABIS at the address or the "For Literature"        
telephone number shown on the front cover of this SAI.                          

           Cumulative Quantity Discount (Right of Accumulation). An investor's
purchase of additional Class A shares of a Fund may be combined with the value  
of the shareholder's existing accounts, thereby enabling the shareholder to take
advantage of the quantity discounts described under "Alternative Purchase       
Arrangements - Class A Shares." In such cases, the applicable sales charge on   
the newly purchased shares will be based on the total of:                       

(i)   the investor's current purchase;                  

           (ii)  the NAV (at the close of business on the previous day) of (a)
                  all shares of the Fund held by the investor and (b) all shares
              held by the investor of any other AllianceBernstein Mutual
             Fund, including AllianceBernstein Institutional Funds and
                 certain CollegeBoundfund accounts for which the investor, his
                or her spouse or domestic partner, or child under the age of
21 is the participant; and                  

        (iii) the NAV of all shares described in paragraph (ii) owned by
               another shareholder eligible to combine his or her purchase
           with that of the investor into a single "purchase" (see
above).                                     

        For example, if an investor owned shares of an AllianceBernstein
Mutual Fund worth $200,000 at their then current NAV and, subsequently,         
purchased Class A shares of a Fund worth an additional $100,000, the initial    
sales charge for the $100,000 purchase would be at the 2.25% rate applicable to 
a single $300,000 purchase of shares of the Fund, rather than the 3.25% rate.   

        Letter of Intent. Class A investors may also obtain the quantity
discounts described under "Alternative Purchase Arrangements - Class A Shares"  
by means of a written Letter of Intent, which expresses the investor's intention
to invest at least $100,000 in Class A shares of a Fund or any AllianceBernstein
Mutual Fund within 13 months. Each purchase of shares under a Letter of Intent  
will be made at the public offering price or prices applicable at the time of   
such purchase to a single transaction of the dollar amount indicated in the     
Letter of Intent. At the investor's option, a Letter of Intent may include      
purchases of shares of the Fund or any other AllianceBernstein Mutual Fund made 
not more than 90 days prior to the date that the investor signs the Letter of   
Intent, in which case the 13-month period during which the Letter of Intent is  
in effect will begin on the date of that earliest purchase. However, sales      
charges will not be reduced for purchases made prior to the date the Letter of  
Intent is signed.                                                               

          Investors qualifying for the Combined Purchase Privilege described
above may purchase shares of the AllianceBernstein Mutual Funds under a single  
Letter of Intent. For example, if at the time an investor signs a Letter of     
Intent to invest at least $100,000 in Class A shares of the Fund, the investor  
and the investor's spouse or domestic partner each purchase shares of the Fund  
worth $20,000 (for a total of $40,000), it will only be necessary to invest a   
total of $60,000 during the following 13 months in shares of the Fund or any    
other AllianceBernstein Mutual Fund, to qualify for the 3.25% sales charge on   
the total amount being invested (the sales charge applicable to an investment of
$100,000).                                                                      

          The Letter of Intent is not a binding obligation upon the investor
to purchase the full amount indicated. The minimum initial investment under a   
Letter of Intent is 5% of such amount. Shares purchased with the first 5% of    
such amount will be held in escrow (while remaining registered in the name of   
the investor) to secure payment of the higher sales charge applicable to the    
shares actually purchased if the full amount indicated is not purchased, and    
such escrowed shares will be involuntarily redeemed at their then NAV to pay the
additional sales charge, if necessary. Dividends on escrowed shares, whether    
paid in cash or reinvested in additional Fund shares, are not subject to escrow.
When the full amount indicated has been purchased, the escrow will be released. 

         Investors wishing to enter into a Letter of Intent in conjunction
with their initial investment in Class A shares of a Fund can obtain a form of  
Letter of Intent by contacting ABIS at the address or telephone numbers shown on
the cover of this SAI.                                                          

          Reinstatement Privilege. A shareholder who has redeemed any or all
of his or her Class A shares may reinvest all or any portion of the proceeds    
from that redemption in Class A shares of any AllianceBernstein Mutual Fund at  
NAV without any sales charge, provided that such reinvestment is made within 120
calendar days after the redemption or repurchase date.Shares are sold to a      
reinvesting shareholder at the NAV next determined as described above. A        
reinstatement pursuant to this privilege will not cancel the redemption or      
repurchase transaction; therefore, any gain or loss so realized will be         
recognized for federal income tax purposes except that no loss will be          
recognized to the extent that the proceeds are reinvested in shares of the Fund 
within 30 calendar days after the redemption or repurchase transaction.         
Investors may exercise the reinstatement privilege by written request sent to   
the Fund at the address shown on the cover of this SAI.                         

         Dividend Reinvestment Program. Shareholders may elect to have all
income and capital gains distributions from their account paid to them in the   
form of additional shares of the same class of a Fund pursuant to the Fund's    
Dividend Reinvestment Program. No initial sales charge or CDSC will be imposed  
on shares issued pursuant to the Dividend Reinvestment Program. Shares issued   
under this program will have an aggregate NAV as of the close of business on the
declaration date of the dividend or distribution equal to the cash amount of the
distribution. Investors wishing to participate in the Dividend Reinvestment     
Program should complete the appropriate section of the Mutual Fund Application  
found in your Prospectus. Current shareholders should contact ABIS to           
participate in the Dividend Reinvestment Program.                               

           In certain circumstances where a shareholder has elected to receive
dividends and/or capital gain distributions in cash but the account has been    
determined to be lost due to mail being returned to us by the Postal Service as 
undeliverable, such shareholder's distributions option will automatically be    
placed within the Dividend Reinvestment Program for future distributions. No    
interest will accrue on amounts represented by uncashed distribution checks.    

    Dividend Direction Plan. A shareholder who already maintains
accounts in more than one AllianceBernstein Mutual Fund may direct that income  
dividends and/or capital gains paid by one AllianceBernstein Mutual Fund be     
automatically reinvested, in any amount, without the payment of any sales or    
service charges, in shares of the same class of the other AllianceBernstein     
Mutual Fund(s). Further information can be obtained by contacting ABIS at the   
address or the "For Literature" telephone number shown on the cover of this SAI.
Investors wishing to establish a dividend direction plan in connection with     
their initial investment should complete the appropriate section of the Mutual  
Fund Application. Current shareholders should contact ABIS to establish a       
dividend direction plan.                                                        

Systematic Withdrawal Plan                                                      
--------------------------                                                      

       General. Any shareholder who owns or purchases shares of a Fund
having a current NAV of at least $5,000 may establish a systematic withdrawal   
plan under which the shareholder will periodically receive a payment in a stated
amount of not less than $50 on a selected date. The $5,000 account minimum does 
not apply to a shareholder owning shares through an individual retirement       
account or other retirement plan who has attained the age of 70- 1/2 who wishes 
to establish a systematic withdrawal plan to help satisfy a required minimum    
distribution. Systematic withdrawal plan participants must elect to have their  
dividends and distributions from the Fund automatically reinvested in additional
shares of the Fund.                                                             

        Shares of a Fund owned by a participant in the Fund's systematic
withdrawal plan will be redeemed as necessary to meet withdrawal payments and   
such payments will be subject to any taxes applicable to redemptions and, except
as discussed below with respect to Class A, Class B and Class C shares, any     
applicable CDSC. Shares acquired with reinvested dividends and distributions    
will be liquidated first to provide such withdrawal payments and thereafter     
other shares will be liquidated to the extent necessary, and depending upon the 
amount withdrawn, the investor's principal may be depleted. A systematic        
withdrawal plan may be terminated at any time by the shareholder or the Fund.   

           Withdrawal payments will not automatically end when a shareholder's
account reaches a certain minimum level. Therefore, redemptions of shares under 
the plan may reduce or even liquidate a shareholder's account and may subject   
the shareholder to the Fund's involuntary redemption provisions. See "Redemption
and Repurchase of Shares -- General." Purchases of additional shares            
concurrently with withdrawals are undesirable because of sales charges          
applicable when purchases are made. While an occasional lump-sum investment may 
be made by a holder of Class A shares who is maintaining a systematic withdrawal
plan, such investment should normally be an amount equivalent to three times the
annual withdrawal or $5,000, whichever is less.                                 

           Payments under a systematic withdrawal plan may be made by check or
electronically via the Automated Clearing House ("ACH") network. Investors      
wishing to establish a systematic withdrawal plan in conjunction with their     
initial investment in shares of a Fund should complete the appropriate portion  
of the Mutual Fund Application, while current Fund shareholders desiring to do  
so can obtain an application form by contacting ABIS at the address or the "For 
Literature" telephone number shown on the cover of this SAI.                    

         CDSC Waiver for Class A, Class B Shares and Class C Shares. Under
the systematic withdrawal plan, up to 1% monthly, 2% bi-monthly or 3% quarterly 
of the value at the time of redemption of the Class A, Class B or Class C shares
in a shareholder's account may be redeemed free of any CDSC.                    

     Class B shares that are not subject to a CDSC (such as shares
acquired with reinvested dividends or distributions) will be redeemed first and 
will count toward the foregoing limitations. Remaining Class B shares that are  
held the longest will be redeemed next. Redemptions of Class B shares in excess 
of the foregoing limitations will be subject to any otherwise applicable CDSC.  

           With respect to Class A and Class C shares, shares held the longest
will be redeemed first and will count toward the foregoing limitations.         
Redemptions in excess of those limitations will be subject to any otherwise     
applicable CDSC.                                                                

Payments to Financial Advisors and Their Firms                                  
----------------------------------------------                                  

        Financial intermediaries market and sell shares of a Fund. These
financial intermediaries employ financial advisors and receive compensation for 
selling shares of the Fund. This compensation is paid from various sources,     
including any sales charge, CDSC and/or Rule 12b-1 fee that you or the Fund may 
pay. Your individual financial advisor may receive some or all of the amounts   
paid to the financial intermediary that employs him or her.                     

            In the case of Class A shares, all or a portion of the initial sales
charge that you pay may be paid by ABI to financial intermediaries selling Class
A shares. ABI may also pay these financial intermediaries a fee of up to 1% on  
purchases of $1 million or more. Additionally, up to 100% of the Rule 12b-1 fees
applicable to Class A shares each year may be paid to financial intermediaries, 
including your financial intermediary, that sell Class A shares.                

       In the case of Class B shares, ABI may pay, at the time of your
purchase, a commission to financial intermediaries selling Class B shares in an 
amount equal to 4% of your investment. Additionally, up to 30% of the Rule 12b-1
fees applicable to Class B shares each year may be paid to financial            
intermediaries, including your financial intermediary, that sell Class B shares.

       In the case of Class C shares, ABI may pay, at the time of your
purchase, a commission to firms selling Class C shares in an amount equal to 1% 
of your investment. Additionally, up to 100% of the Rule 12b-1 fee applicable to
Class C shares each year may be paid to financial intermediaries, including your
financial intermediary, that sell Class C shares.                               

        In the case of Class R and Class K shares up to 100% of the Rule
12b-1 fee applicable to Class R and Class K shares each year may be paid to     
financial intermediaries, including your financial intermediary, that sell Class
R and Class K shares.                                                           

       In the case of Advisor Class shares, your financial advisor may
charge ongoing fees or transactional fees. ABI may pay a portion of "ticket" or 
other transactional charges.                                                    

          Your financial advisor's firm receives compensation from the Fund,
ABI and/or the Adviser in several ways from various sources, which include some 
or all of the following:                                                        

o     upfront sales commissions;                                    

o     Rule 12b-1 fees;                                              

o     additional distribution support;                              

o     defrayal of costs for educational seminars and training; and  

 o     payments related to providing shareholder record-keeping and/or
transfer agency services.                               

     Please read your Prospectus carefully for information on this
compensation.                                                                   

Other Payments for Distribution Services and Educational Support                
----------------------------------------------------------------                

          In addition to the commissions paid to financial intermediaries at
the time of sale and the fees described under "Asset-Based Sales Charges or     
Distribution and/or Service (Rule 12b-1) Fees," in your Prospectus, some or all 
of which may be paid to financial intermediaries (and, in turn, to your         
financial advisor), ABI, at its expense, currently provides additional payments 
to firms that sell shares of the AllianceBernstein Mutual Funds. Although the   
individual components may be higher and the total amount of payments made to    
each qualifying firm in any given year may vary, the total amount paid to a     
financial intermediary in connection with the sale of shares of the             
AllianceBernstein Mutual Funds will generally not exceed the sum of (a) 0.25% of
the current year's fund sales by that firm and (b) 0.10% of average daily net   
assets attributable to that firm over the year. These sums include payments to  
reimburse directly or indirectly the costs incurred by these firms and their    
employees in connection with educational seminars and training efforts about the
AllianceBernstein Mutual Funds for the firms' employees and/or their clients and
potential clients. The costs and expenses associated with these efforts may     
include travel, lodging entertainment and meals.                                

           For 2011, ABI's additional payments to these firms for distribution
services and educational support related to the AllianceBernstein Mutual Funds  
are expected to be approximately 0.04% of the average monthly assets of the     
AllianceBernstein Mutual Funds, or approximately $18 million. In 2010, ABI paid 
approximately 0.04% of the average monthly assets of the AllianceBernstein      
Mutual Funds or approximately $16.5 million for distribution services and       
education support related to the AllianceBernstein Mutual Funds.                

        A number of factors are considered in determining the additional
payments, including each firm's AllianceBernstein Mutual Fund sales, assets and 
redemption rates, and the willingness and ability of the firm to give ABI access
to its financial advisors for educational or marketing purposes. In some cases, 
firms will include the AllianceBernstein Mutual Funds on a "preferred list."    
ABI's goal is to make the financial advisors who interact with current and      
prospective investors and shareholders more knowledgeable about the             
AllianceBernstein Mutual Funds so that they can provide suitable information and
advice about the funds and related investor services.                           

        Each Fund and ABI also make payments for recordkeeping and other
transfer agency services to financial intermediaries that sell AllianceBernstein
Mutual Fund shares. Please see "Expenses of the Fund - Transfer Agency          
Agreement" above. These expenses paid by the Fund are included in "Other        
Expenses" under "Fees and Expenses of the Fund - Annual Fund Operating Expenses"
in your Prospectus.                                                             

        If one mutual fund sponsor makes greater distribution assistance
payments than another, your financial advisor and his or her firm may have an   
incentive to recommend one fund complex over another. Similarly, if your        
financial advisor or his or her firm receives more distribution assistance for  
one share class versus another, then they may have an incentive to recommend    
that class.                                                                     

        Please speak with your financial advisor to learn more about the
total amounts paid to your financial advisor and his or her firm by the Fund,   
the Adviser, ABI and by sponsors of other mutual funds he or she may recommend  
to you. You should also consult disclosures made by your financial advisor at   
the time of your purchase.                                                      

            ABI anticipates that the firms that will receive additional payments
for distribution services and/or educational support include:                   

Advisor Group, Inc.                                                 
Ameriprise Financial Services                                       
AXA Advisors                                                        
Bank of America                                                     
Cadaret, Grant & Co.                                                
CCO Investment Services Corp.                                       
Chase Investment Services                                           
Commonwealth Financial Network                                      
Donegal Securities                                                  
Financial Network Investment Company                                
LPL Financial Corporation                                           
Merrill Lynch                                                       
Morgan Stanley Smith Barney                                         
Multi-Financial Securities Corporation                              
Northwestern Mutual Investment Services                             
PrimeVest Financial Services                                        
Raymond James                                                       
RBC Wealth Management                                               
Robert W. Baird                                                     
UBS Financial Services                                              
Wells Fargo Advisors                                                
Wells Fargo Investments                                             

        ABI expects that additional firms may be added to this list from
time to time.                                                                   

         Although the Funds may use brokers and dealers who sell shares of
the Funds to effect portfolio transactions, the Funds do not consider the sale  
of AllianceBernstein Mutual Fund shares as a factor when selecting brokers or   
dealers to effect portfolio transactions.                                       

--------------------------------------------------------------------------------

REDEMPTION AND REPURCHASE OF SHARES 

--------------------------------------------------------------------------------

    The following information supplements that set forth in your
Prospectus under the heading "Investing in the Funds." If you are an Advisor    
Class shareholder through an account established under a fee-based program your 
fee-based program may impose requirements with respect to the purchase, sale or 
exchange of Advisor Class shares of the Fund that are different from those      
described herein. A transaction fee may be charged by your financial            
intermediary with respect to the purchase, sale or exchange of Advisor Class    
shares made through such financial intermediary. The Fund has authorized one or 
more brokers to receive on its behalf purchase and redemption orders. Such      
brokers are authorized to designate other intermediaries to receive purchase and
redemption orders on the Fund's behalf. In such cases, orders will receive the  
NAV next computed after such order is properly received by the authorized broker
or designee and accepted by the Fund.                                           

Redemption                                                                      
----------                                                                      

       Subject only to the limitations described below, each Fund will
redeem the shares tendered to them, as described below, at a redemption price   
equal to their NAV as next computed following the receipt of shares tendered for
redemption in proper form. Except for any CDSC which may be applicable to Class 
A, Class B or Class C shares, there is no redemption charge. Payment of the     
redemption price normally will be made within seven days after the Fund's       
receipt of such tender for redemption. If a shareholder is in doubt about what  
documents are required by his or her fee-based program or employee benefit plan,
the shareholder should contact his or her financial intermediary.               

           The right of redemption may not be suspended or the date of payment
upon redemption postponed for more than seven days after shares are tendered for
redemption, except for any period during which the Exchange is closed (other    
than customary weekend and holiday closings), or during which the Commission    
determines that trading thereon is restricted, or for any period during which an
emergency (as determined by the Commission) exists as a result of which disposal
by the Fund of securities owned by it is not reasonably practicable or as a     
result of which it is not reasonably practicable for the Fund fairly to         
determine the value of its net assets, or for such other periods as the         
Commission may by order permit for the protection of security holders of the    
Fund.                                                                           

         Payment of the redemption price normally will be made in cash but
may be made, at the option of the Fund, in kind. No interest will accrue on     
uncashed redemption checks. The value of a shareholder's shares on redemption or
repurchase may be more or less than the cost of such shares to the shareholder, 
depending upon the market value of the Fund's portfolio securities at the time  
of such redemption or repurchase. Redemption proceeds from Class A, Class B and 
Class C shares will reflect the deduction of the CDSC, if any. Payment received 
by a shareholder upon redemption or repurchase of his or her shares, assuming   
the shares constitute capital assets in his or her hands, will result in        
long-term or short-term capital gain (or loss) depending upon the shareholder's 
holding period and basis in respect of the shares redeemed.                     

        To redeem shares of a Fund for which no shares certificates have
been issued, the registered owner or owners should forward a letter to the Fund 
containing a request for redemption. The Fund may require the signature or      
signatures on the letter to be Medallion Signature Guaranteed. Please contact   
ABIS to confirm whether a Medallion Signature Guarantee is needed.              

         To redeem shares of a Fund represented by share certificates, the
investor should forward the appropriate share certificate or certificates,      
endorsed in blank or with blank stock powers attached, to the Fund with the     
request that the shares represented thereby, or a specified portion thereof, be 
redeemed. The stock assignment form on the reverse side of each share           
certificate surrendered to the Fund for redemption must be signed by the        
registered owner or owners exactly as the registered name appears on the face of
the certificate or, alternatively, a stock power signed in the same manner may  
be attached to the share certificate or certificates or, where tender is made by
mail, separately mailed to the relevant Fund. The signature or signatures on the
assignment form must be guaranteed in the manner described above.               

    Telephone Redemption by Electronic Funds Transfer. Each Fund
shareholder is entitled to request redemption by electronic funds transfer (of  
shares for which no share certificates have been issued) by telephone at (800)  
221-5672 if the shareholder has completed the appropriate portion of the Mutual 
Fund Application or, if an existing shareholder has not completed this portion, 
by an "Autosell" application obtained from ABIS (except for certain omnibus     
accounts). A telephone redemption request by electronic funds transfer may not  
exceed $100,000, and must be made by 4:00 p.m., Eastern time, on a Fund business
day as defined above. Proceeds of telephone redemptions will be sent by         
electronic funds transfer to a shareholder's designated bank account at a bank  
selected by the shareholder that is a member of the NACHA.                      

           Telephone Redemption by Check. Each Fund shareholder is eligible to
request redemption by check of Fund shares for which no share certificates have 
been issued by telephone at (800) 221-5672 before 4:00 p.m., Eastern time, on a 
Fund business day in an amount not exceeding $100,000. Proceeds of such         
redemptions are remitted by check to the shareholder's address of record. A     
shareholder otherwise eligible for telephone redemption by check may cancel the 
privilege by written instruction to ABIS, or by checking the appropriate box on 
the Mutual Fund Application.                                                    

            Telephone Redemptions - General. During periods of drastic economic,
market or other developments, such as the terrorist attacks on September 11,    
2001, it is possible that shareholders would have difficulty in reaching ABIS by
telephone (although no such difficulty was apparent at any time in connection   
with the attacks). If a shareholder were to experience such difficulty, the     
shareholder should issue written instructions to ABIS at the address shown on   
the cover of this SAI. The Fund reserves the right to suspend or terminate its  
telephone redemption service at any time without notice. Telephone redemption by
check is not available with respect to shares (i) for which certificates have   
been issued, (ii) held in nominee or "street name" accounts, (iii) held by a    
shareholder who has changed his or her address of record within the preceding 30
calendar days or (iv) held in any retirement plan account. Neither the Fund, the
Adviser, ABI nor ABIS will be responsible for the authenticity of telephone     
requests for redemptions that the Fund reasonably believes to be genuine. The   
Fund will employ reasonable procedures in order to verify that telephone        
requests for redemptions are genuine, including, among others, recording such   
telephone instructions and causing written confirmations of the resulting       
transactions to be sent to shareholders. If the Fund did not employ such        
procedures, it could be liable for losses arising from unauthorized or          
fraudulent telephone instructions. Financial intermediaries may charge a        
commission for handling telephone requests for redemptions.                     

Repurchase                                                                      
----------                                                                      

The Fund may repurchase shares through ABI or financial 
intermediaries. The repurchase price will be the NAV next determined after ABI  
receives the request (less the CDSC, if any, with respect to the Class A, Class 
B and Class C shares), except that requests placed through financial            
intermediaries before the close of regular trading on the Exchange on any day   
will be executed at the NAV determined as of such close of regular trading on   
that day if received by ABI prior to its close of business on that day (normally
5:00 p.m., Eastern time). The financial intermediary is responsible for         
transmitting the request to ABI by 5:00 p.m., Eastern time, (certain financial  
intermediaries may enter into operating agreements permitting them to transmit  
purchase information that was received prior to the close of business to ABI    
after 5:00 p.m., Eastern time, and receive that day's NAV). If the financial    
intermediary fails to do so, the shareholder's right to receive that day's      
closing price must be settled between the shareholder and that financial        
intermediary. A shareholder may offer shares of the Fund to ABI either directly 
or through a financial intermediary. Neither the Fund nor ABI charges a fee or  
commission in connection with the repurchase of shares (except for the CDSC, if 
any, with respect to Class A, Class B and Class C shares). Normally, if shares  
of the Fund are offered through a financial intermediary, the repurchase is     
settled by the shareholder as an ordinary transaction with or through that      
financial intermediary, who may charge the shareholder for this service. The    
repurchase of shares of the Fund as described above with respect to financial   
intermediaries is a voluntary service of the Fund, and the Fund may suspend or  
terminate this practice at any time.                                            

General                                                                         
-------                                                                         

    The Fund reserves the right to close out an account that has
remained below $1,000 for 90 days. No CDSC will be deducted from the proceeds of
this redemption. In the case of a redemption or repurchase of shares of the Fund
recently purchased by check, redemption proceeds will not be made available     
until the relevant Fund is reasonably assured that the check has cleared,       
normally up to 15 calendar days following the purchase date.                    

--------------------------------------------------------------------------------

SHAREHOLDER SERVICES

--------------------------------------------------------------------------------

    The following information supplements that set forth in your
Prospectus under the heading "Investing in the Funds." The shareholder services 
set forth below are applicable to all classes of shares unless otherwise        
indicated.                                                                      

  If you are an Advisor Class shareholder through an account
established under a fee-based program or a shareholder in a group retirement    
plan, your fee-based program or retirement plan may impose requirements with    
respect to the purchase, sale or exchange of shares of the Fund that are        
different from those described herein. A transaction fee may be charged by your 
financial intermediary with respect to the purchase, sale or exchange of Advisor
Class shares made through such intermediary.                                    

Automatic Investment Program                                                    
----------------------------                                                    

    Investors may purchase shares of a Fund through an automatic
investment program utilizing electronic funds transfer drawn on the investor's  
own bank account. Under such a program, pre-authorized monthly drafts for a     
fixed amount are used to purchase shares through the financial intermediary     
designated by the investor at the public offering price next determined after   
ABI receives the proceeds from the investor's bank. The monthly drafts must be  
in minimum amounts of either $50 or $200, depending on the investor's initial   
purchase. If an investor makes an initial purchase of at least $2,500, the      
minimum monthly amount for pre-authorized drafts is $50. If an investor makes an
initial purchase of less than $2,500, the minimum monthly amount for            
pre-authorized drafts is $200 and the investor must commit to a monthly         
investment of at least $200 until the investor's account balance is $2,500 or   
more. In electronic form, drafts can be made on or about a date each month      
selected by the shareholder. Investors wishing to establish an automatic        
investment program in connection with their initial investment should complete  
the appropriate portion of the Mutual Fund Application. As of January 31, 2009, 
the Automatic Investment Program is available for purchase of Class B shares    
only if a shareholder was enrolled in the Program prior to January 31, 2009.    
Current shareholders should contact ABIS at the address or telephone numbers    
shown on the cover of this SAI to establish an automatic investment program.    

            Shareholders committed to monthly investments of $25 or more through
the Automatic Investment Program by October 15, 2004 are able to continue their 
program despite the $50 monthly minimum.                                        

Exchange Privilege                                                              
------------------                                                              

           You may exchange your investment in the Fund for shares of the same
class of other AllianceBernstein Mutual Funds (including AllianceBernstein      
Exchange Reserves, a money market fund managed by the Adviser) if the other     
AllianceBernstein Mutual Fund in which you wish to invest offer shares of the   
same class. In addition, (i) present officers and full-time employees of the    
Adviser, (ii) present directors or trustees of any AllianceBernstein Mutual     
Fund, (iii) certain employee benefit plans for employees of the Adviser, ABI,   
ABIS and their affiliates and (iv) persons participating in a fee-based program,
sponsored and maintained by a registered broker-dealer or other financial       
intermediary and approved by ABI, under which such persons pay an asset-based   
fee for service in the nature of investment advisory or administrative services 
may, on a tax-free basis, exchange Class A shares of the Fund for Advisor Class 
shares of the Fund. Exchanges of shares are made at the NAV next determined and 
without sales or service charges. Exchanges may be made by telephone or written 
request. In order to receive a day's NAV, ABIS must receive and confirm a       
telephone exchange request by 4:00 p.m., Eastern time, on that day.             

           Shares will continue to age without regard to exchanges for purpose
of determining the CDSC, if any, upon redemption and, in the case of Class B    
shares, for the purpose of conversion to Class A shares. After an exchange, your
Class B shares will automatically convert to Class A shares in accordance with  
the conversion schedule applicable to the Class B shares of the                 
AllianceBernstein Mutual Fund you originally purchased for cash ("original      
shares"). When redemption occurs, the CDSC applicable to the original shares is 
applied.                                                                        

            Please read carefully the prospectus of the AllianceBernstein Mutual
Fund into which you are exchanging before submitting the request. Call ABIS at  
(800) 221-5672 to exchange uncertificated shares. Except with respect to        
exchanges of Class A shares of the Fund for Advisor Class shares of the Fund,   
exchanges of shares as described above in this section are taxable transactions 
for federal income tax purposes. The exchange service may be modified,          
restricted or terminated on 60 days' written notice.                            

            All exchanges are subject to the minimum investment requirements and
any other applicable terms set forth in the prospectus for the AllianceBernstein
Mutual Fund whose shares are being acquired. An exchange is effected through the
redemption of the shares tendered for exchange and the purchase of shares being 
acquired at their respective NAVs as next determined following receipt by the   
AllianceBernstein Mutual Fund whose shares are being exchanged of (i) proper    
instructions and all necessary supporting documents as described in such fund's 
prospectus, or (ii) a telephone request for such exchange in accordance with the
procedures set forth in the following paragraph. Exchanges involving the        
redemption of shares recently purchased by check will be permitted only after   
the AllianceBernstein Mutual Fund whose shares have been tendered for exchange  
is reasonably assured that the check has cleared, normally up to 15 calendar    
days following the purchase date. Exchanges of shares of AllianceBernstein      
Mutual Funds will generally result in the realization of a capital gain or loss 
for federal income tax purposes.                                                

          Each Fund shareholder and the shareholder's financial intermediary
are authorized to make telephone requests for exchanges unless ABIS receives    
written instruction to the contrary from the shareholder, or the shareholder    
declines the privilege by checking the appropriate box on the Mutual Fund       
Application. Such telephone requests cannot be accepted with respect to shares  
then represented by share certificates. Shares acquired pursuant to a telephone 
request for exchange will be held under the same account registration as the    
shares redeemed through such exchange.                                          

           Eligible shareholders desiring to make an exchange should telephone
ABIS with their account number and other details of the exchange at (800)       
221-5672 before 4:00 p.m., Eastern time, on the Fund business day as defined    
above. Telephone requests for exchange received before 4:00 p.m., Eastern time, 
on the Fund business day will be processed as of the close of business on that  
day. During periods of drastic economic, market or other developments, such as  
the terrorist attacks on September 11, 2001, it is possible that shareholders   
would have difficulty in reaching ABIS by telephone (although no such difficulty
was apparent at any time in connection with the attacks). If a shareholder were 
to experience such difficulty, the shareholder should issue written instructions
to ABIS at the address shown on the cover of this SAI.                          

     A shareholder may elect to initiate a monthly "Auto Exchange"
whereby a specified dollar amount's worth of his or her Fund shares (minimum    
$25) is automatically exchanged for shares of another AllianceBernstein Mutual  
Fund.                                                                           

            None of the AllianceBernstein Mutual Funds, the Adviser, ABI or ABIS
will be responsible for the authenticity of telephone requests for exchanges    
that the Fund reasonably believes to be genuine. The Fund will employ reasonable
procedures in order to verify that telephone requests for exchanges are genuine,
including, among others, recording such telephone instructions and causing      
written confirmations of the resulting transactions to be sent to shareholders. 
If the Fund did not employ such procedures, it could be liable for losses       
arising from unauthorized or fraudulent telephone instructions. Financial       
intermediaries may charge a commission for handling telephone requests for      
exchanges.                                                                      

          The exchange privilege is available only in states where shares of
the AllianceBernstein Mutual Funds being acquired may legally be sold. Each     
AllianceBernstein Mutual Fund reserves the right, at any time on 60 days notice 
to its shareholders, to reject any order to acquire its shares through exchange 
or otherwise to modify, restrict or terminate the exchange privilege.           

Statements and Reports                                                          
----------------------                                                          

      Each shareholder receives semi-annual and annual reports which
include a portfolio of investments, financial statements and, in the case of the
annual report, the report of the Funds' independent registered public accounting
firm, Ernst & Young LLP, as well as a confirmation of each purchase and         
redemption. By contacting his or her financial intermediary or ABIS, a          
shareholder can arrange for copies of his or her account statements to be sent  
to another person.                                                              

Shareholder Services Applicable to Class A and Class C Shareholders Only        
------------------------------------------------------------------------        

Checkwriting                                                                    
------------                                                                    

            A new Class A or Class C investor may fill out the Signature Card to
authorize the Fund to arrange for a checkwriting service through State Street   
Bank and Trust Company (the "Bank") to draw against Class A or Class C shares of
the Fund redeemed from the investor's account. Under this service, checks may be
made payable to any payee in any amount not less than $500 and not more than 90%
of the NAV of the Class A or Class C shares in the investor's account (excluding
for this purpose the current month's accumulated dividends and shares for which 
certificates have been issued). A Class A or Class C shareholder wishing to     
establish this checkwriting service subsequent to the opening of his or her Fund
account should contact the Fund by telephone or mail. Corporations, fiduciaries 
and institutional investors are required to furnish a certified resolution or   
other evidence of authorization. This checkwriting service will be subject to   
the Bank's customary rules and regulations governing checking accounts, and the 
Fund and the Bank each reserve the right to change or suspend the checkwriting  
service. There is no charge to the shareholder for the initiation and           
maintenance of this service or for the clearance of any checks.                 

           When a check is presented to the Bank for payment, the Bank, as the
shareholder's agent, causes the Fund to redeem, at the NAV next determined, a   
sufficient number of full and fractional shares of the Fund in the shareholder's
account to cover the check. Because the level of net assets in a shareholder's  
account constantly changes due, among various factors, to market fluctuations, a
shareholder should not attempt to close his or her account by use of a check. In
this regard, the Bank has the right to return checks (marked "insufficient      
funds") unpaid to the presenting bank if the amount of the check exceeds 90% of 
the assets in the account. Canceled (paid) checks are returned to the           
shareholder. The checkwriting service enables the shareholder to receive the    
daily dividends declared on the shares to be redeemed until the day that the    
check is presented to the Bank for payment.                                     

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NET ASSET VALUE 

--------------------------------------------------------------------------------

       The NAV is computed at the next close of regular trading on the
Exchange (ordinarily 4:00 p.m., Eastern time) following receipt of a purchase or
redemption order by a Fund on each Fund business day on which such an order is  
received and on such other days as the Board deems appropriate or necessary in  
order to comply with Rule 22c-1 under the 1940 Act. A Fund's per share NAV is   
calculated by dividing the value of the Fund's total assets, less its           
liabilities, by the total number of its shares then outstanding. As noted above,
a Fund business day is any weekday on which the Exchange is open for trading.   

      In accordance with applicable rules under the 1940 Act and the
Fund's pricing policies and procedures adopted by the Board (the "Pricing       
Policies"), portfolio securities are valued at current market value or at fair  
value as determined in accordance with procedures established by, and under the 
general supervision of the Board. The Board has delegated to the Adviser,       
subject to the Board's continuing oversight, certain of its duties with respect 
to the Pricing Policies.                                                        

            Whenever possible, securities are valued based on market information
on the business day as of which the value being determined, as follows:         

     (a) a security listed on the Exchange, or another national or
foreign exchange (other than securities listed on the Nasdaq Stock Exchange     
("NASDAQ")) is valued at the last sale price reflected on the consolidated tape 
at the close of the exchange or foreign securities exchange. If there has been  
no sale on the relevant business day, the security is valued at the mean of the 
closing bid and asked prices on that day. If no bid or asked prices are quoted  
on that day, the security is valued in good faith at fair value by, or in       
accordance with procedures approved by, the Board;                              

        (b) a security traded on NASDAQ is valued at the NASDAQ Official
Closing Price;                                                                  

    (c) a security traded on more than one exchange is valued in
accordance with paragraph (a) above by reference to the principal exchange (as  
determined by the Adviser) on which the security is traded;                     

            (d) a listed put or call option is valued at the last sale price. If
there has been no sale on the relevant business day, the security is valued at  
the closing bid price on that day;                                              

         (e) a currency option is valued using third party pricing models;

            (f) an open futures contract and any option thereon is valued at the
closing settlement price or, in the absence of such a price, the most recent    
quoted bid price. If there are no quotations available for the relevant business
day, the security is valued at the last available closing settlement price;     

         (g) a security traded in the over-the-counter market, including a
security listed on a national securities exchange whose principal market is     
over-the-counter (as determined by the Adviser) is valued at the mean of the    
current bid and asked prices as reported by the National Quotation Bureau or    
other comparable source(s);                                                     

           (h) a U.S. Government security and any other debt instrument having
60 days or less remaining until maturity generally is valued at amortized cost  
if its original maturity was 60 days or less, or by amortizing its fair value as
of the 61st day prior to maturity if the original term to maturity exceeded 60  
days, unless in either case the Adviser determines that this method does not    
represent fair value);                                                          

        (i) a fixed-income security is valued on the basis of bid prices
provided by a pricing service when the Adviser believes that such prices reflect
the market value of the security. The prices provided by a pricing service may  
take into account many factors, including institutional size, trading in similar
groups of securities and any developments related to specific securities. If the
Adviser determines that an appropriate pricing service does not exist for a     
security, the security is valued on the basis of a quoted bid price or spread   
over the applicable yield curve (abid spread) by a broker-dealer in such        
security. The second highest price will be utilized whenever two or more quoted 
bid prices are obtained;                                                        

       (j) a mortgage-backed or asset-backed security is valued on the
basis of bid prices obtained from pricing services or bid prices obtained from  
multiple major broker-dealers in the security when the Adviser believes that    
these prices reflect the market value of the security. In cases in which        
broker-dealer quotes are obtained, the Adviser has procedures for using changes 
in market yields or spreads to adjust, on a daily basis, a recently obtained    
quoted bid price on a security. The second highest price will be utilized       
whenever two or more quoted bid prices are obtained;                            

          (k) bank loans are valued on the basis of bid prices provided by a
pricing service;                                                                

    (l) forward and spot currency pricing is provided by pricing
services;                                                                       

      (m) a swap is valued by the Adviser utilizing various external
sources to obtain inputs for variables in pricing models; and                   

         (n) open end mutual funds are valued at the closing NAV per share
and closed end funds are valued at the closing market price per share.          

  A Fund values its securities at their current market value
determined on the basis of market quotations or, if market quotations are not   
readily available or are unreliable, at "fair value" as determined in accordance
with procedures established by and under the general supervision of the Fund's  
Board. When the Fund uses fair value pricing, it may take into account any      
factors it deems appropriate. A Fund may determine fair value based upon        
developments related to a specific security, current valuations of foreign stock
indices (as reflected in U.S. futures markets) and/or U.S. sector or broader    
stock market indices. The prices of securities used by the Fund to calculate its
NAV may differ from quoted or published prices for the same securities. Fair    
value pricing involves subjective judgments and it is possible that the fair    
value determined for a security is materially different than the value that     
could be realized upon the sale of that security.                               

            Each Fund expects to use fair value pricing for securities primarily
traded on U.S. exchanges only under very limited circumstances, such as the     
early closing of the exchange on which a security is traded or suspension of    
trading in the security. The Fund may use fair value pricing more frequently for
securities primarily traded in non-U.S. markets because, among other things,    
most foreign markets close well before the Fund values its securities at 4:00   
p.m., Eastern time. The earlier close of these foreign markets gives rise to the
possibility that significant events, including broad market moves, may have     
occurred in the interim. For example, the Fund believes that foreign security   
values may be affected by events that occur after the close of foreign          
securities markets. To account for this, the Fund may frequently value many of  
its foreign equity securities using fair value prices based on third party      
vendor modeling tools to the extent available.                                  

 Subject to its oversight, each Fund's Board has delegated
responsibility for valuing the Fund's assets to the Adviser. The Adviser has    
established a Valuation Committee, which operates under the policies and        
procedures approved by the Board, to value the Fund's assets on behalf of the   
Fund. The Valuation Committee values Fund assets as described above.            

           Each Fund's Board may suspend the determination of its NAV (and the
offering and sale of shares), subject to the rules of the Commission and other  
governmental rules and regulations, at a time when: (1) the Exchange is closed, 
other than customary weekend and holiday closings, (2) an emergency exists as a 
result of which it is not reasonably practicable for the Fund to dispose of     
securities owned by it or to determine fairly the value of its net assets, or   
(3) for the protection of shareholders, the Commission by order permits a       
suspension of the right of redemption or a postponement of the date of payment  
on redemption.                                                                  

          For purposes of determining a Fund's NAV per share, all assets and
liabilities initially expressed in a foreign currency will be converted into    
U.S. Dollars at the mean of the current bid and asked prices of such currency   
against the U.S. Dollar last quoted by a major bank that is a regular           
participant in the relevant foreign exchange market or on the basis of a pricing
service that takes into account the quotes provided by a number of such major   
banks. If such quotations are not available as of the close of the Exchange, the
rate of exchange will be determined in good faith by, or under the direction of,
the Board.                                                                      

            The assets attributable to the Class A shares, Class B shares, Class
C shares, Class R shares, Class K shares, Class I shares and Advisor Class      
shares will be invested together in a single portfolio. The NAV of each class   
will be determined separately by subtracting the liabilities allocated to that  
class from the assets belonging to that class in conformance with the provisions
of a plan adopted by the Fund in accordance with Rule 18f-3 under the 1940 Act. 

--------------------------------------------------------------------------------

DIVIDENDS, DISTRIBUTIONS AND TAXES

--------------------------------------------------------------------------------

U.S. Federal Income Taxation of Dividends and Distributions                     
-----------------------------------------------------------                     

          General.  Each Fund intends for each taxable year to qualify to be
taxed as a "regulated investment company" under the Code. To so qualify, a Fund 
must, among other things, (i) derive at least 90% of its gross income in each   
taxable year from dividends, interest, payments with respect to securities      
loans, gains from the sale or other disposition of stock, securities or foreign 
currency, certain other income (including, but not limited to, gains from       
options, futures or forward currency exchange contracts) derived with respect to
its business of investing in stock, securities or currency or net income derived
from interests in certain qualified publicly traded partnerships; and (ii)      
diversify its holdings so that, at the end of each quarter of its taxable year, 
the following two conditions are met: (a) at least 50% of the value of the      
Fund's assets is represented by cash, cash items, U.S. Government securities,   
securities of other regulated investment companies and other securities with    
respect to which the Fund's investment is limited, in respect of any one issuer,
to an amount not greater than 5% of the value of the Fund's assets and to not   
more than 10% of the outstanding voting securities of such issuer and (b) not   
more than 25% of the value of the Fund's assets is invested in securities of any
one issuer (other than U.S. Government securities or securities of other        
regulated investment companies), securities (other than securities of other     
regulated investment companies) of any two or more issuers which the Fund       
controls and which are engaged in the same or similar trades or businesses or   
related trades or businesses, or securities of one or more qualified publicly   
traded partnerships.                                                            

     If a Fund qualifies as a regulated investment company for any
taxable year and makes timely distributions to its shareholders of 90% or more  
of its investment company taxable income for that year (calculated without      
regard to its net capital gain, i.e., the excess of its net long-term capital   
gain over its net short-term capital loss) it will not be subject to federal    
income tax on the portion of its taxable income for the year (including any net 
capital gain) that it distributes to shareholders.                              

           It is the present policy of each Fund to distribute to shareholders
all net investment income quarterly and to distribute net realized capital      
gains, if any, annually. The amount of any such distributions must necessarily  
depend upon the realization by the Fund of income and capital gains from        
investments.                                                                    

      Each Fund will also avoid the 4% federal excise tax that would
otherwise apply to certain undistributed income for a given calendar year if it 
makes timely distributions to the shareholders equal to at least the sum of (i) 
98.2% of its ordinary income for that year, (ii) 98% of its capital gain net    
income and foreign currency gains for the twelve-month period ending on October 
31 of that year or later, if the Fund is permitted to so elect and so elects,   
and (iii) any ordinary income or capital gain net income from the preceding     
calendar year that was not distributed during such year. For this purpose,      
income or gain retained by the Fund that is subject to corporate income tax will
be considered to have been distributed by the Fund during such year. For federal
income and excise tax purposes, dividends declared and payable to shareholders  
of record as of a date in October, November or December of a given year but     
actually paid during the immediately following January will be treated as if    
paid by the Fund on December 31 of such earlier calendar year, and will be      
taxable to these shareholders in the year declared, and not in the year in which
the shareholders actually receive the dividend.                                 

     The information set forth in the Prospectus and the following
discussion relate solely to the significant U.S. federal income taxes on        
dividends and distributions by a Fund and assume that the Fund qualifies to be  
taxed as a regulated investment company. An investor should consult his or her  
own tax advisor with respect to the specific tax consequences of being a        
shareholder in a Fund, including the effect and applicability of federal, state,
local and foreign tax laws to his or her own particular situation and the       
possible effects of changes therein.                                            

      Dividends and Distributions.  Each Fund intends to make timely
distributions of the Fund's taxable income (including any net capital gain) so  
that the Fund will not be subject to federal income and excise taxes. Dividends 
of the Fund's net ordinary income and distributions of any net realized         
short-term capital gain are taxable to shareholders as ordinary income.         

      Some or all of the distributions from a Fund may be treated as
"qualified dividend income," taxable to individuals, trusts and estates at the  
reduced maximum rate of 15% if paid on or before December 31, 2012 (5% for      
individuals, trusts and estates in lower tax brackets), provided that both the  
fund and the shareholder satisfy certain holding period and other requirements. 
Based upon the investment policies of the Funds, it is expected that only a     
small portion, if any, of the Funds' distributions would be treated as          
"qualified dividend income."                                                    

          Distributions of net capital gain are taxable as long-term capital
gain, regardless of how long a shareholder has held shares in the Funds. Any    
dividend or distribution received by a shareholder on shares of a Fund will have
the effect of reducing the NAV of such shares by the amount of such dividend or 
distribution. Furthermore, a dividend or distribution made shortly after the    
purchase of such shares by a shareholder, although in effect a return of capital
to that particular shareholder, would be taxable to him or her as described     
above. Dividends are taxable in the manner discussed regardless of whether they 
are paid to the shareholder in cash or are reinvested in additional shares of a 
Fund. The investment objectives of the Funds is such that only a small portion, 
if any, of the Funds' distributions is expected to qualify for the              
dividends-received deduction for corporate shareholders.                        

           After the end of the calendar year, a Fund will notify shareholders
of the federal income tax status of any distributions made by the Fund to       
shareholders during such year.                                                  

      Sales and Redemptions. Any gain or loss arising from a sale or
redemption of Fund shares generally will be capital gain or loss if a Fund      
shares are held as a capital asset, and will be long-term capital gain or loss  
if the shareholder has held such shares for more than one year at the time of   
the sale or redemption; otherwise it will be short-term capital gain or loss. If
a shareholder has held shares in the Fund for six months or less and during that
period has received a distribution of net capital gain, any loss recognized by  
the shareholder on the sale of those shares during the six-month period will be 
treated as a long-term capital loss to the extent of the distribution. In       
determining the holding period of such shares for this purpose, any period      
during which a shareholder's risk of loss is offset by means of options, short  
sales or similar transactions is not counted.                                   

          Any loss realized by a shareholder on a sale or exchange of shares
of a Fund will be disallowed to the extent the shares disposed of are reacquired
within a period of 61 days beginning 30 days before and ending 30 days after the
shares are sold or exchanged. For this purpose, acquisitions pursuant to the    
Dividend Reinvestment Plan would constitute a reacquisition if made within the  
period. If a loss is so disallowed, then such loss will be reflected in an      
upward adjustment to the basis of the shares acquired.                          

      Qualified Plans. A dividend or capital gains distribution with
respect to shares of a Fund held by a tax-deferred or qualified plan, such as an
individual retirement account, section 403(b)(7) retirement plan or corporate   
pension or profit-sharing plan, generally will not be taxable to the plan.      
Distributions from such plans will be taxable to individual participants under  
applicable tax rules without regard to the character of the income earned by the
qualified plan.                                                                 

     Backup Withholding. Any distributions and redemption proceeds
payable to a shareholder may be subject to "backup withholding" tax (currently  
at a rate of 28% through 2012) if such shareholder fails to provide a Fund with 
his or her correct taxpayer identification number, fails to make certain        
required certifications or is notified by the Internal Revenue Service (the     
"IRS") that he or she is subject to backup withholding. Corporate shareholders  
and certain other shareholders specified in the Code are exempt from such backup
withholding. Backup withholding is not an additional tax; rather, a shareholder 
generally may obtain a refund of any amounts withheld under backup withholding  
rules that exceed such shareholder's U.S. federal income tax liability by filing
a refund claim with the IRS, provided that the required information is furnished
to the IRS.                                                                     

            The backup withholding tax rate will be 28% for amounts paid through
December 31, 2012. The backup withholding rate will be 31% for amounts paid     
after December 31, 2012.                                                        

       Foreign Taxes. Income received by a Fund also may be subject to
foreign income taxes, including taxes withheld at the source. The U.S. has      
entered into tax treaties with many foreign countries which entitle a Fund to a 
reduced rate of such taxes or exemption from taxes on such income. It is        
impossible to determine the effective rate of foreign tax in advance since the  
amount of a Fund's assets to be invested within various countries is not known. 

            If more than 50% of the value of a Fund's assets at the close of its
taxable year consists of stocks or securities of foreign corporations (which for
this purpose should include obligations issued by foreign governments), the Fund
will be eligible and intends to file an election with the IRS to pass through to
its shareholders the amount of foreign taxes paid by the Fund. However, there   
can be no assurance that a Fund will be able to do so. If a Fund makes this     
election, a shareholder will be required to (i) include in gross income (in     
addition to taxable dividends actually received), his or her pro rata share of  
foreign taxes paid by the Fund, (ii) treat his or her pro rata share of such    
foreign taxes as having been paid by him and (iii) either deduct such pro rata  
share of foreign taxes in computing his or her taxable income or treat such     
foreign taxes as a credit against United States federal income taxes.           
Shareholders who are not liable for federal income taxes, such as retirement    
plans qualified under section 401 of the Code, will not be affected by any such 
pass-through of taxes by a Fund. No deduction for foreign taxes may be claimed  
by an individual shareholder who does not itemize deductions. In addition,      
certain shareholders may be subject to rules which limit or reduce their ability
to fully deduct, or claim a credit for, their pro rata share of the foreign     
taxes paid by the Fund. A shareholder's foreign tax credit with respect to a    
dividend received from a Fund will be disallowed unless the shareholder holds   
shares in the Fund on the ex-dividend date and for at least 15 other days during
the 30-day period beginning 15 days prior to the ex-dividend date. Each         
shareholder will be notified within 60 days after the close of the Fund's       
taxable year whether the foreign taxes paid by the Fund will pass through for   
that year and, if so, such notification will designate (i) the shareholder's    
portion of the foreign taxes paid, to each such country and (ii) the portion of 
dividends that represents income derived from sources within each such country. 

         The federal income tax status of each year's distributions by the
Fund will be reported to shareholders and to the IRS. The foregoing is only a   
general description of the treatment of foreign taxes under the U.S. federal    
income tax laws. Because the availability of a foreign tax credit or deduction  
will depend on the particular circumstances of each shareholder, potential      
investors are advised to consult their own tax advisers.                        

U.S. Federal Income Taxation of the Funds                                       
-----------------------------------------                                       

            The following discussion relates to certain significant U.S. federal
income tax consequences to a Fund with respect to the determination of its      
"investment company taxable income" each year. This discussion assumes that each
Fund will be taxed as a regulated investment company for each of its taxable    
years.                                                                          

         Zero Coupon Treasury Securities. Under current federal tax law, a
Fund will receive net investment income in the form of interest by virtue of    
holding Treasury bills, notes and bonds, and will recognize interest            
attributable to it under the original issue discount rules of the Code from     
holding zero coupon Treasury securities. Current federal tax law requires that a
holder (such as a Fund) of a zero coupon security accrue a portion of the       
discount at which the security was purchased as income each year even though the
Fund receives no interest payment in cash on the security during the year.      
Accordingly, a Fund may be required to pay out as an income distribution each   
year an amount that is greater than the total amount of cash interest the Fund  
actually received. Such distributions will be made from the cash assets of the  
Fund or by liquidation of portfolio securities, if necessary. If a distribution 
of cash necessitates the liquidation of portfolio securities, the Adviser will  
select which securities to sell. A Fund may realize a gain or loss from such    
sales. In the event a Fund realizes net capital gains from such transactions,   
its shareholders may receive a larger capital gain distribution, if any, than   
they would have in the absence of such transactions.                            

            Options, Futures Contracts, and Forward Currency Exchange Contracts.
Certain listed options, regulated futures contracts, and forward currency       
exchange contracts are considered "section 1256 contracts" for federal income   
tax purposes. Section 1256 contracts held by a Fund at the end of each taxable  
year will be "marked to market" and treated for federal income tax purposes as  
though sold for fair market value on the last business day of such taxable year.
Gain or loss realized by a Fund on section 1256 contracts other than forward    
currency exchange contracts will be considered 60% long-term and 40% short-term 
capital gain or loss, although the Fund may elect to have the gain or loss it   
realizes on certain contracts taxed as "section 988" gain or loss. Gain or loss 
realized by a Fund on forward currency exchange contracts generally will be     
treated as section 988 gain or loss and will therefore be characterized as      
ordinary income or loss and will increase or decrease the amount of the Fund's  
net investment income available to be distributed to shareholders as ordinary   
income, as described above. A Fund can elect to exempt its section 1256         
contracts which are part of a "mixed straddle" (as described below) from the    
application of section 1256.                                                    

           With respect to over-the-counter put and call options, gain or loss
realized by a Fund upon the lapse or sale of such options held by the Fund will 
be either long-term or short-term capital gain or loss depending upon the Fund's
holding period with respect to such option. However, gain or loss realized upon 
the lapse or closing out of such options that are written by a Fund will be     
treated as short-term capital gain or loss. In general, if a Fund exercises an  
option, or if an option that the Fund has written is exercised, gain or loss on 
the option will not be separately recognized but the premium received or paid   
will be included in the calculation of gain or loss upon disposition of the     
property underlying the option.                                                 

            Gain or loss realized by a Fund on the lapse or sale of put and call
options on foreign currencies which are traded over-the-counter or on certain   
foreign exchanges will be treated as section 988 gain or loss and will therefore
be characterized as ordinary income or loss and will increase or decrease the   
amount of the Fund's net investment income available to be distributed to       
shareholders as ordinary income, as described above. The amount of such gain or 
loss shall be determined by subtracting the amount paid, if any, for or with    
respect to the option (including any amount paid by a Fund upon termination of  
an option written by the Fund) from the amount received, if any, for or with    
respect to the option (including any amount received by the Fund upon           
termination of an option held by the Fund). In general, if a Fund exercises such
an option on a foreign currency, or if such an option that the Fund has written 
is exercised, gain or loss on the option will be recognized in the same manner  
as if the Fund had sold the option (or paid another person to assume the Fund's 
obligation to make delivery under the option) on the date on which the option is
exercised, for the fair market value of the option. The foregoing rules will    
also apply to other put and call options which have as their underlying property
foreign currency and which are traded over-the-counter or on certain foreign    
exchanges to the extent gain or loss with respect to such options is            
attributable to fluctuations in foreign currency exchange rates.                

           Stripped-Mortgage Related Securities. Certain classes of SMRS which
are issued at a discount, the payments of which are subject to acceleration by  
reason of prepayments of the underlying Mortgage Assets securing such classes,  
are subject to special rules for determining the portion of the discount at     
which the class was issued which must be accrued as income each year. Under Code
section 1272(a)(6), a principal-only class or a class which receives a portion  
of the interest and a portion of the principal from the underlying Mortgage     
Assets is subject to rules which require accrual of interest to be calculated   
and included in the income of a holder (such as a Fund) based on the increase in
the present value of the payments remaining on the class, taking into account   
payments includable in the class's stated redemption price at maturity which are
received during the accrual period. For this purpose, the present value         
calculation is made at the beginning of each accrual period (i) using the yield 
to maturity determined for the class at the time of its issuance (determined on 
the basis of compounding at the close of each accrual period and properly       
adjusted for the length of the accrual period), calculated on the assumption    
that certain prepayments will occur, and (ii) taking into account any           
prepayments that have occurred before the close of the accrual period. Since    
interest included in a Fund's income as a result of these rules will have been  
accrued and not actually paid, the Fund may be required to pay out as an income 
distribution each year an amount which is greater than the total amount of cash 
interest it actually received, with possible results as described above.        

     Tax Straddles. Any option, futures contract or other position
entered into or held by a Fund in conjunction with any other position held by   
the Fund may constitute a "straddle" for federal income tax purposes. A straddle
of which at least one, but not all, the positions are section 1256 contracts may
constitute a "mixed straddle." In general, straddles are subject to certain     
rules that may affect the character and timing of the Fund's gains and losses   
with respect to straddle positions by requiring, among other things, that (i)   
loss realized on disposition of one position of a straddle not be recognized to 
the extent that the Fund has unrealized gains with respect to the other position
in such straddle; (ii) the Fund's holding period in straddle positions be       
suspended while the straddle exists (possibly resulting in gain being treated as
short-term capital gain rather than long-term capital gain); (iii) losses       
recognized with respect to certain straddle positions which are part of a mixed 
straddle and which are non-section 1256 positions be treated as 60% long-term   
and 40% short-term capital loss; (iv) losses recognized with respect to certain 
straddle positions which would otherwise constitute short-term capital losses be
treated as long-term capital losses; and (v) the deduction of interest and      
carrying charges attributable to certain straddle positions may be deferred.    
Various elections are available to the Fund which may mitigate the effects of   
the straddle rules, particularly with respect to mixed straddles. In general,   
the straddle rules described above do not apply to any straddles held by the    
Fund all of the offsetting positions of which consist of section 1256 contracts.

          Currency Fluctuations -- "Section 988" Gains and Losses. Under the
Code, gains or losses attributable to fluctuations in exchange rates which occur
between the time a Fund accrues interest or other receivables or accrues        
expenses or other liabilities denominated in a foreign currency and the time the
Fund actually collects such receivables or pays such liabilities are treated as 
ordinary income or ordinary loss. Similarly, gains or losses from the           
disposition of foreign currencies, from the disposition of debt securities      
denominated in a foreign currency, or from the disposition of a forward currency
exchange contract denominated in a foreign currency which are attributable to   
fluctuations in the value of the foreign currency between the date of           
acquisition of the asset and the date of disposition also are treated as        
ordinary income or loss. These gains or losses, referred to under the Code as   
"section 988" gains or losses, increase or decrease the amount of a Fund's      
investment company taxable income available to be distributed to its            
shareholders as ordinary income, rather than increasing or decreasing the amount
of the Fund's net capital gain. Because section 988 losses reduce the amount of 
ordinary dividends a Fund will be allowed to distribute for a taxable year, such
section 988 losses may result in all or a portion of prior dividend             
distributions for such year being recharacterized as a non-taxable return of    
capital to shareholders, rather than as an ordinary dividend, reducing each     
shareholder's basis in his or her Fund shares. To the extent that such          
distributions exceed such shareholder's basis, each will be treated as a gain   
from the sale of shares.                                                        

Other Taxation                                                                  
--------------                                                                  

A Fund may be subject to other state and local taxes.   

Taxation of Foreign Stockholders                                                
--------------------------------                                                

       Taxation of a shareholder who, under the Code, is a nonresident
alien individual, foreign trust or estate, foreign corporation or foreign       
partnership ("foreign shareholder"), depends on whether the income from the Fund
is "effectively connected" with a U.S. trade or business carried on by the      
foreign shareholder.                                                            

       If the income from a Fund is not effectively connected with the
foreign shareholder's U.S. trade or business, then, except as discussed below,  
distributions of the Fund attributable to ordinary income and short-term capital
gain paid to a foreign shareholder by the Fund will be subject to U.S.          
withholding tax at the rate of 30% (or lower treaty rate) upon the gross amount 
of the distribution. However, distributions of a Fund attributable to short-term
capital gains and U.S. source portfolio interest income paid during taxable     
years of the Fund beginning before January 1, 2012 will not be subject to this  
withholding tax.                                                                

           A foreign shareholder generally would be exempt from Federal income
tax on distributions of a Fund attributable to net long-term capital gain and on
gain realized from the sale or redemption of shares of the Fund. Special rules  
apply in the case of a shareholder that is a foreign trust or foreign           
partnership.                                                                    

         If the income from a Fund is effectively connected with a foreign
shareholder's U.S. trade or business, then ordinary income distributions,       
capital gain distributions, and any gain realized upon the sale of shares of the
Fund will be subject to Federal income tax at the rates applicable to U.S.      
citizens or U.S. corporations.                                                  

           The tax consequences to a foreign shareholder entitled to claim the
benefits of an applicable tax treaty may be different from those described      
herein.                                                                         

           The tax rules of other countries with respect to an investment in a
Fund can differ from the Federal income taxation rules described above. These   
foreign rules are not discussed herein. Foreign shareholders are urged to       
consult their own tax advisors as to the consequences of foreign tax rules with 
respect to an investment in the Fund.                                           

--------------------------------------------------------------------------------

FUND TRANSACTIONS 

--------------------------------------------------------------------------------

       Subject to the general oversight of the Board of each Fund, the
Adviser is responsible for the investment decisions and the placing of orders   
for portfolio transactions of the Funds. The Adviser determines the broker or   
dealer to be used in each specific transaction with the objective of negotiating
a combination of the most favorable commission (for transactions on which a     
commission is payable) and the best price obtainable on each transaction        
(generally defined as "best execution"). In connection with seeking best price  
and execution, a Fund does not consider sales of shares of the Fund or other    
investment companies managed by the Adviser as a factor in the selection of     
brokers and dealers to effect portfolio transactions and has adopted a policy   
and procedures reasonably designed to preclude such consideration.              

       When consistent with the objective of obtaining best execution,
brokerage may be directed to persons or firms supplying investment information  
to the Adviser. There may be occasions where the transaction cost charged by a  
broker may be greater than that which another broker may charge if it is        
determined in good faith that the amount of such transaction cost is reasonable 
in relation to the value of brokerage, research and statistical services        
provided by the executing broker.                                               

        Neither the Funds nor the Adviser has entered into agreements or
understandings with any brokers regarding the placement of securities           
transactions because of research services they provide. To the extent that such 
persons or firms supply investment information to the Adviser for use in        
rendering investment advice to the Funds, such information may be supplied at no
cost to the Adviser and, therefore, may have the effect of reducing the expenses
of the Adviser in rendering advice to the Funds. While it is impracticable to   
place an actual dollar value on such investment information, its receipt by the 
Adviser probably does not reduce the overall expenses of the Adviser to any     
material extent.                                                                

         The investment information provided to the Adviser is of the type
described in Section 28(e) of the Securities Exchange Act of 1934 and is        
designed to augment the Adviser's own internal research and investment strategy 
capabilities. Research services furnished by brokers through which the Fund     
effects securities transactions are used by the Adviser in carrying out its     
investment management responsibilities with respect to all its client accounts. 

The extent to which commissions that will be charged by 
broker-dealers selected by a Fund may reflect an element of value for research  
cannot presently be determined. To the extent that research services of value   
are provided by broker-dealers with or through whom the Fund places portfolio   
transactions, the Adviser may be relieved of expenses which it might otherwise  
bear. Research services furnished by broker-dealers could be useful and of value
to the Adviser in servicing its other clients as well as the Fund; on the other 
hand, certain research services obtained by the Adviser as a result of the      
placement of portfolio brokerage of other clients could be useful and of value  
to it in servicing the Fund.                                                    

           A Fund may deal in some instances in securities that are not listed
on a national securities exchange but are traded in the over-the-counter market.
They may also purchase listed securities through the third market, (i.e., from a
dealer) that is not a member of the exchange on which a security is listed.     
Where transactions are executed in the over-the-counter market or third market, 
a Fund will seek to deal with the primary market makers; but when necessary in  
order to obtain the best price and execution, they will utilize the services of 
others. In all cases, a Fund will attempt to negotiate best execution.          

         Investment decisions for a Fund are made independently from those
for other investment companies and other advisory accounts managed by the       
Adviser. It may happen, on occasion, that the same security is held in the      
portfolio of a Fund and one or more of such other companies or accounts.        
Simultaneous transactions are likely when several funds or accounts are managed 
by the same Adviser, particularly when a security is suitable for the investment
objectives of more than one of such companies or accounts. When two or more     
companies or accounts managed by the Adviser are simultaneously engaged in the  
purchase or sale of the same security, the transactions are allocated to the    
respective companies or accounts both as to amount and price, in accordance with
a method deemed equitable to each company or account. In some cases, this system
may adversely affect the price paid or received by the Fund or the size of the  
position obtainable for the Fund.                                               

           Allocations are made by the officers of the Fund or of the Adviser.
Purchases and sales of portfolio securities are determined by the Adviser and   
are placed with broker-dealers by the order department of the Adviser.          

     A Fund's portfolio transactions occur primarily with issuers,
underwriters or major dealers acting as principals. Such transactions are       
normally on a net basis which do not involve payment of brokerage commissions.  
The cost of securities purchased from an underwriter usually includes a         
commission paid by the issuer to the underwriter; transactions with dealers     
normally reflect the spread between bid and asked prices. Premiums are paid with
respect to options purchased by the Fund, and brokerage commissions are payable 
with respect to transactions in exchange-traded interest rate futures contracts.

        Most transactions for the Fund, including transactions in listed
securities, are executed in the over-the-counter market by approximately fifteen
(15) principal market maker dealers with whom the Adviser maintains regular     
contact. Most transactions made by the Fund will be principal transactions at   
net prices and the Fund will incur little or no brokerage costs. Where possible,
securities will be purchased directly from the issuer or from an underwriter or 
market maker for the securities unless the Adviser believes a better price and  
execution is available elsewhere. Purchases from underwriters of newly-issued   
securities for inclusion in the Fund usually will include a concession paid to  
the underwriter by the issuer, and purchases from dealers serving as market     
makers will include the spread between the bid and asked price.                 

         A Fund has no obligation to enter into transactions in securities
with any broker, dealer, issuer, underwriter or other entity. Where best price  
and execution may be obtained from more than one broker or dealer, the Adviser  
may, in its discretion, purchase and sell securities through brokers and dealers
who provide research, statistical and other information to the Adviser. Such    
services may be used by the Adviser for all of its investment advisory accounts 
and, accordingly, not all such services may be used by the Adviser in connection
with a Fund. During the fiscal years ended October 31, 2008, 2009, and 2010 for 
Intermediate Bond, Unconstrained Bond and High Income and for the fiscal years  
ended September 30, 2008, 2009, and 2010 for Global Bond, the Funds incurred no 
brokerage commissions.                                                          

          A Fund may from time to time place orders for the purchase or sale
of securities (including listed call options) with SCB & Co., an affiliate of   
the Adviser. In such instances, the placement of orders with such broker would  
be consistent with the Fund's objective of obtaining the best execution and     
would not be dependent upon the fact that SCB & Co. is an affiliate of the      
Adviser. With respect to orders placed with SCB & Co. for execution on a        
national securities exchange, commissions received must conform to Section      
17(e)(2)(A) of the 1940 Act and Rule 17e-1 thereunder, which permit an          
affiliated person of a registered investment company (such as the Funds), or any
affiliated person of such person, to receive a brokerage commission from such   
registered investment company provided that such commission is reasonable and   
fair compared to the commissions received by other brokers in connection with   
comparable transactions involving similar securities during a comparable period 
of time.                                                                        

Disclosure of Portfolio Holdings                                                
--------------------------------                                                

           Each Fund believes that the ideas of the Adviser's investment staff
should benefit the Fund and its shareholders, and does not want to afford       
speculators an opportunity to profit by anticipating Fund trading strategies or 
using Fund information for stock picking. However, each Fund also believes that 
knowledge of the Fund's portfolio holdings can assist shareholders in monitoring
their investment, making asset allocation decisions, and evaluating portfolio   
management techniques.                                                          

     The Adviser has adopted, on behalf of each Fund, policies and
procedures relating to disclosure of the Fund's portfolio securities. The       
policies and procedures relating to disclosure of the Fund's portfolio          
securities are designed to allow disclosure of portfolio holdings information   
where necessary to the Fund's operation or useful to the Fund's shareholders    
without compromising the integrity or performance of the Fund. Except when there
are legitimate business purposes for selective disclosure and other conditions  
(designed to protect the Fund and its shareholders) are met, the Fund does not  
provide or permit others to provide information about the Fund's portfolio      
holdings on a selective basis.                                                  

       The Fund includes portfolio holdings information as required in
regulatory filings and shareholder reports, discloses portfolio holdings        
information as required by federal or state securities laws and may disclose    
portfolio holdings information in response to requests by governmental          
authorities. In addition, the Adviser posts portfolio holdings information on   
the Adviser's website (www.AllianceBernstein.com). The Adviser posts on the     
website a complete schedule of the Fund's portfolio securities, as of the last  
day of each calendar month, approximately 30 days after the end of that month.  
This posted information generally remains accessible on the website for three   
months. For each portfolio security, the posted information includes its name,  
the number of shares held by the Fund, the market value of the Fund's holdings, 
and the percentage of the Fund's assets represented by the Fund's holdings. In  
addition to the schedule of portfolio holdings, the Adviser may post information
about the number of securities the Fund holds, a summary of the Fund's top ten  
holdings (including name and the percentage of the Fund's assets invested in    
each holding), and a percentage breakdown of the Fund's investments by country, 
sector, or industry, as applicable approximately 10-15 days after the end of the
month. The day after portfolio holdings information is publicly available on the
website, it may be mailed, e-mailed or otherwise transmitted to any person.     

   The Adviser may distribute or authorize the distribution of
information about the Fund's portfolio holdings that is not publicly available, 
on the website or otherwise, to the Adviser's employees and affiliates that     
provide services to the Fund. In addition, the Adviser may distribute or        
authorize distribution of information about the Fund's portfolio holdings that  
is not publicly available, on the website or otherwise, to the Fund's service   
providers who require access to the information in order to fulfill their       
contractual duties relating to the Fund, and to facilitate the review of the    
Fund by rating agencies, for the purpose of due diligence regarding a merger or 
acquisition, or for the purpose of effecting in-kind redemption of securities to
facilitate orderly redemption of portfolio assets and minimal impact on         
remaining Fund shareholders. The Adviser does not expect to disclose information
about the Fund's portfolio holdings that is not publicly available to the Fund's
individual or institutional investors or to intermediaries that distribute the  
Fund's shares. Information may be disclosed with any frequency and any lag, as  
appropriate.                                                                    

        Before any non-public disclosure of information about the Fund's
portfolio holdings is permitted, however, the Adviser's Chief Compliance Officer
(or his designee) must determine that the Fund has a legitimate business purpose
for providing the portfolio holdings information, that the disclosure is in the 
best interests of the Fund's shareholders, and that the recipient agrees or has 
a duty to keep the information confidential and agrees not to trade directly or 
indirectly based on the information or to use the information to form a specific
recommendation about whether to invest in the Fund or any other security. Under 
no circumstances may the Adviser or its affiliates receive any consideration or 
compensation for disclosing the information.                                    

        The Adviser has established procedures to ensure that the Fund's
portfolio holdings information is only disclosed in accordance with these       
policies. Only the Adviser's Chief Compliance Officer (or his designee) may     
approve the disclosure, and then only if he or she and a designated senior      
officer in the Adviser's product management group determines that the disclosure
serves a legitimate business purpose of the Fund and is in the best interest of 
the Fund's shareholders. The Adviser's Chief Compliance Officer (or his         
designee) approves disclosure only after considering the anticipated benefits   
and costs to the Fund and its shareholders, the purpose of the disclosure, any  
conflicts of interest between the interests of the Fund and its shareholders and
the interests of the Adviser or any of its affiliates, and whether the          
disclosure is consistent with the policies and procedures governing disclosure. 
Only someone approved by the Adviser's Chief Compliance Officer (or his         
designee) may make approved disclosures of portfolio holdings information to    
authorized recipients. The Adviser reserves the right to request certifications 
from senior officers of authorized recipients that the recipient is using the   
portfolio holdings information only in a manner consistent with the Adviser's   
policy and any applicable confidentiality agreement. The Adviser's Chief        
Compliance Officer (or his designee) or another member of the compliance team   
reports all arrangements to disclose portfolio holdings information to the      
Fund's Board on a quarterly basis. If the Board determines that disclosure was  
inappropriate, the Adviser will promptly terminate the disclosure arrangement.  

        In accordance with these procedures, each of the following third
parties have been approved to receive information concerning the Fund's         
portfolio holdings: (i) the Fund's independent registered public accounting     
firm, for use in providing audit opinions; (ii) RR Donnelley Financial, Data    
Communique International and, from time to time, other financial printers, for  
the purpose of preparing Fund regulatory filings; (iii) the Fund's custodian in 
connection with its custody of the Fund's assets; (iv) Risk Metrics for proxy   
voting services; and (v) data aggregators, such as Vestek. Information may be   
provided to these parties at any time with no time lag. Each of these parties is
contractually and ethically prohibited from sharing the Fund's portfolio        
holdings information unless specifically authorized.                            

--------------------------------------------------------------------------------

GENERAL INFORMATION 

--------------------------------------------------------------------------------

Description of the Funds                                                        
------------------------                                                        

ALLIANCEBERNSTEIN INTERMEDIATE BOND                                             

           Intermediate Bond is a series of AllianceBernstein Bond Fund, Inc.,
a Maryland Corporation organized in 1973 under the name "Alliance Bond Fund,    
Inc." The Fund's name became "AllianceBernstein Bond Fund, Inc." on March 31,   
2003.                                                                           

ALLIANCEBERNSTEIN UNCONSTRAINED BOND FUND, INC.                                 

           The Fund is a Maryland corporation organized in 1995 under the name
of "Alliance Global Strategic Income Trust, Inc." The name became               
"AllianceBernstein Global Strategic Income Trust, Inc. on March 31, 2003, became
AllianceBernstein Diversified Yield Fund, Inc. on November 5, 2007 and became   
AllianceBernstein Unconstrained Bond Fund, Inc. on February 3, 2011.            

ALLIANCEBERNSTEIN GLOBAL BOND FUND, INC.                                        

           The Fund is a Maryland corporation organized in 1992 under the name
of "Alliance North American Government Income Fund, Inc." The name became       
"Alliance Americas Government Income Trust, Inc." on March 1, 2002,             
"AllianceBernstein Americas Government Income Trust, Inc." on March 31, 2003,   
"AllianceBernstein Global Government Income Trust, Inc." on February 1, 2006,   
and "AllianceBernstein Global Bond Fund, Inc." on November 5, 2007.             

ALLIANCEBERNSTEIN HIGH INCOME FUND, INC.                                        

           The Fund is a Maryland corporation organized in 1993 under the name
of "Alliance Global Dollar Government Fund, Inc." The name became "Alliance     
Emerging Market Debt Fund, Inc." on March 1, 2002, "AllianceBernstein Emerging  
Market Debt Fund, Inc." on March 31, 2003, and "AllianceBernstein High Income   
Fund, Inc." on January 28, 2008.                                                

           A shareholder will be entitled to share pro rata with other holders
of the same class of shares all dividends and distributions arising from a      
Fund's assets and, upon redeeming shares, will receive the then current NAV of  
the Fund represented by the redeemed shares less any applicable CDSC. A Fund is 
empowered to establish, without shareholder approval, additional portfolios,    
which may have different investment objectives and policies than those of the   
Fund, and additional classes of shares within the Fund. If an additional        
portfolio or class were established in the Fund, each share of the portfolio or 
class would normally be entitled to one vote for all purposes. Generally, shares
of each portfolio and class would vote together as a single class on matters,   
such as the election of Directors, that affect each portfolio and class in      
substantially the same manner. Each class of shares of a Fund has the same      
rights and is identical in all respects except that each class bears its own    
distribution and transfer agency expenses. Each class of shares of a Fund votes 
separately with respect to the Fund's Plan and other matters for which separate 
class voting is appropriate under applicable law. Shares are freely             
transferable, are entitled to dividends as determined by the Directors and, in  
liquidation of a Fund, are entitled to receive the net assets of the Fund.      
Certain additional matters relating to a Fund's organization are discussed in   
this SAI.                                                                       

            It is anticipated that annual shareholder meetings will not be held;
shareholder meetings will be held only when required by federal or state law.   
Shareholders have available certain procedures for the removal of directors.    

         Each class of shares of a Fund represents an interest in the same
portfolio of investments, and has the same rights and is identical in all       
respects, except that expenses related to the distribution of each class are    
borne solely by each class and each class of shares has exclusive voting rights 
with respect to provisions of the Plan which pertain to a particular class and  
other matters for which separate class voting is appropriate under applicable   
law, provided that, if the Fund submits to a vote of the Class A shareholders an
amendment to the Plan that would materially increase the amount to be paid      
thereunder with respect to the Class A shares, then such amendment will also be 
submitted to the Class B and Advisor Class shareholders, and the Class A        
shareholders, the Class B shareholders and the Advisor Class shareholders will  
vote separately by class.                                                       

     A Fund's Board may, without shareholder approval, increase or
decrease the number of authorized but unissued shares of the Fund's Class A,    
Class B, Class C, Class R, Class K, Class I and Advisor Class Common Stock.     

            To the knowledge of each Fund, the following persons owned of record
or beneficially, 5% or more of a class of outstanding shares of the Fund as of  
January 4, 2011:                                                                

                                                                    % of
Class A                                                Number of        Class A 
Shares Fund    Name and Address                        Class A Shares   Shares  
-----------    ----------------                        --------------   ------- 

Intermediate   First Clearing, LLC                                              
Bond           Special Custody Acct For The                                     
Exclusive Benefit Of Customer                     
2801 Market St.                                   
              Saint Louis, MO 63103-2523               2,320,925         6.31%

MLPF&S                                            
For The Sole Benefit of Its                       
Customers                                         
Attn: Fund Admin                                  
4800 Deer Lake Dr., East, 2nd Floor               
              Jacksonville, FL 32246-6484              4,490,840        12.22%

National Financial Services LLC                   
For the Exclusive Benefit of our                  
Customers                                         
Attn: Mutual Funds Dept                           
200 Liberty St., 5th Floor                        
One World Financial Center                        
              New York, NY 10281-5503                  2,929,025         7.97%

Pershing LLC                                      
P.O. Box 2052                                     
              Jersey City, NJ 07303-2052               2,262,156         6.15%

Unconstrained  Citigroup Global Markets                                         
Bond           House Account                                                    
Attn: Cindy Tempesta                              
333 W. 34th St., Floor 3                          
              New York, NY 10001-2402                    264,765         5.26%

First Clearing, LLC                               
Special Custody Acct For The                      
Exclusive Benefit Of Customer                     
2801 Market St.                                   
              Saint Louis, MO 63103-2523                 316,819         6.29%

MLPF&S                                            
For The Sole Benefit of Its                       
Customers                                         
Attn: Fund Admin                                  
4800 Deer Lake Dr. East, 2nd Floor                
              Jacksonville, FL 32246-6484                654,505        13.00%

National Financial Services LLC                   
For the Exclusive Benefit of our                  
Customers                                         
Attn: Mutual Funds Dept                           
200 Liberty St 5th Floor                          
One World Financial Center                        
              New York, NY 10281-5503                    493,989         9.81%

Pershing LLC                                      
P.O. Box 2052                                     
              Jersey City, NJ 07303-2052               1,205,326        23.94%

Global Bond    First Clearing, LLC                                              
Special Custody Acct For The                      
Exclusive Benefit Of Customer                     
2801 Market St.                                   
              Saint Louis, MO 63103-2523              10,781,443         5.28%

MLPF&S                                            
For The Sole Benefit of Its                       
Customers                                         
Attn: Fund Admin                                  
4800 Deer Lake Dr., East 2nd Floor                
              Jacksonville, FL 32246-6484             13,238,978         6.49%

Morgan Stanley Smith Barney                       
Harborside Financial Center                       
Plaza II, 3rd Floor                               
              Jersey City, NJ 07311                   12,858,105         6.30%

National Financial Services LLC                   
For the Exclusive Benefit of our                  
Customers                                         
Attn: Mutual Funds Dept                           
200 Liberty St., 5th Floor                        
One World Financial Center                        
              New York, NY 10281-5503                 23,130,783        11.33%

Pershing LLC                                      
P.O. Box 2052                                     
              Jersey City, NJ 07303-2052              22,514,097        11.03%

High Income    Citigroup Global Markets                                         
House Account                                     
Attn: Cindy Tempesta                              
333 W. 34th St., Floor 3                          
              New York, NY 10001-2402                  8,661,453         5.38%

First Clearing, LLC                               
Special Custody Acct For The                      
Exclusive Benefit of Customer                     
2801 Market St.                                   
              Saint Louis, MO 63103-2523              11,257,969         6.99%

MLPF&S                                            
For The Sole Benefit Of Its                       
Customers                                         
Attn: Fund Admin                                  
4800 Deer Lake Dr., East 2nd Floor                
              Jacksonville, FL 32246-6484             14,765,359         9.17%

National Financial Services LLC                   
For the Exclusive Benefit of our                  
Customer                                          
Attn: Mutual Funds Dept                           
200 Liberty St., 5th Floor                        
One World Financial Center                        
              New York, NY 10281-5503                 19,180,255        11.91%

Pershing LLC                                      
P.O. Box 2052                                     
              Jersey City, NJ 07303-2052              15,822,116         9.83%

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                                                                    % of
Class B                                                Number of        Class B 
Shares Fund    Name and Address                        Class B Shares   Shares  
-----------    ----------------                        --------------   ------- 

Intermediate   First Clearing, LLC                                              
Bond           Special Custody Acct For The                                     
Exclusive Benefit of Customer                     
2801 Market St.                                   
               Saint Louis, MO 63103-2523                      98,896      7.30%

MLPF&S                                            
For The Sole Benefit of Its                       
Customers                                         
Attn: Fund Admin                                  
4800 Deer Lake Dr., East 2nd Floor                
               Jacksonville, FL 32246-6484                    297,021     21.91%

National Financial Services LLC                   
For the Exclusive Benefit of our                  
Customers                                         
Attn: Mutual Funds Dept                           
200 Liberty St., 5th Floor                        
One World Financial Center                        
               New York, NY 10281-5503                        134,349      9.91%

Pershing LLC                                      
P.O. Box 2052                                     
               Jersey City, NJ 07303-2052                      92,907      6.85%

Unconstrained  First Clearing, LLC                                              
Bond           Special Custody Acct For The                                     
Exclusive Benefit Of Customer                     
2801 Market St.                                   
               Saint Louis, MO 63103-2523                      51,648     12.68%

MLPF&S                                            
For The Sole Benefit of Its                       
Customers                                         
Attn: Fund Admin                                  
4800 Deer Lake Dr., East 2nd Floor                
               Jacksonville, FL 32246-6484                     69,432     17.05%

National Financial Services LLC                   
For the Exclusive Benefit of our                  
Customers                                         
Attn: Mutual Funds Dept                           
200 Liberty St., 5th Floor                        
One World Financial Center                        
               New York, NY 10281-5503                         48,959     12.02%

Pershing LLC                                      
P.O. Box 2052                                     
               Jersey City, NJ 07303-2052                      57,839     14.20%

Global Bond    Citigroup Global Markets                                         
House Account                                     
Attn: Cindy Tempesta                              
333 W. 34th St., 3rd Floor                        
               New York, NY 10001-2402                        481,749      5.42%

First Clearing, LLC                               
Special Custody Acct For The                      
Exclusive Benefit Of Customer                     
2801 Market St.                                   
               Saint Louis, MO 63103-2523                     933,194     10.50%

MLPF&S                                            
For The Sole Benefit of Its                       
Customers                                         
Attn: Fund Admin                                  
4800 Deer Lake Dr., East 2nd Floor                
               Jacksonville, FL 32246-6484                  1,789,142     20.14%

National Financial Services LLC                   
For the Exclusive Benefit of our                  
Customers                                         
Attn: Mutual Funds Dept                           
200 Liberty St., 5th Floor                        
One World Financial Center                        
               New York, NY 10281-5503                      1,524,869     17.17%

Pershing LLC                                      
P.O. Box 2052                                     
               Jersey City, NJ 07303-2052                     977,576     11.00%

High Income    Citigroup Global Markets                                         
House Account                                     
Attn: Cindy Tempesta                              
333 W. 34th St., 3rd Floor                        
              New York, NY 10001-2402                        235,579     5.89%

First Clearing, LLC                               
Special Custody Acct For The                      
Exclusive Benefit Of Customer                     
2801 Market St.                                   
               Saint Louis, MO 63103-2523                     569,214     14.23%

MLPF&S                                            
For The Sole Benefit Of Its                       
Customers                                         
Attn: Fund Admin                                  
4800 Deer Lake Dr., East 2nd Floor                
               Jacksonville, FL 32246-6484                    539,364     13.48%

National Financial Services LLC                   
For the Exclusive Benefit of our                  
Customers                                         
Attn: Mutual Funds Dept                           
200 Liberty St., 5th Floor                        
One World Financial Center                        
               New York, NY 10281-5503                        335,042      8.38%

Pershing LLC                                      
P.O. Box 2052                                     
               Jersey City, NJ 07303-2052                     395,176      9.88%

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                                                                    % of
Class C                                                Number of        Class C 
Shares Fund    Name and Address                        Class C Shares   Shares  
-----------    ----------------                        --------------   ------- 

Intermediate   First Clearing, LLC                                              
Bond           Special Custody Acct For The                                     
Exclusive Benefit Of Customer                     
2801 Market St.                                   
               Saint Louis, MO 63103-2523                     421,038      7.24%

MLPF&S                                            
For The Sole Benefit of Its                       
Customers                                         
Attn: Fund Admin                                  
4800 Deer Lake Dr., East 2nd Floor                
               Jacksonville, FL 32246-6484                  1,544,890     26.58%

National Financial Services LLC                   
For the Exclusive Benefit of our                  
Customers                                         
Attn: Mutual Funds Dept                           
200 Liberty St., 5th Floor                        
One World Financial Center                        
               New York, NY 10281-5503                        526,233      9.05%

Pershing LLC                                      
P.O. Box 2052                                     
               Jersey City, NJ 07303-2052                     672,637     11.57%

Unconstrained  First Clearing, LLC                                              
Bond           Special Custody Acct For The                                     
Exclusive Benefit Of Customer                     
2801 Market St.                                   
               Saint Louis, MO 63103-2523                     142,292      9.70%

MLPF&S                                            
For The Sole Benefit of Its                       
Customers                                         
Attn: Fund Admin                                  
4800 Deer Lake Dr. East, 2nd Floor                
               Jacksonville, FL 32246-6484                    173,366     11.82%

National Financial Services LLC                   
For the Exclusive Benefit of our                  
Customers                                         
Attn: Mutual Funds Dept                           
200 Liberty St., 5th Floor                        
One World Financial Center                        
               New York, NY 10281-5503                         82,193      5.60%

Pershing LLC                                      
P.O. Box 2052                                     
               Jersey City, NJ 07303-2052                     443,863     30.25%

Global Bond    Citigroup Global Markets                                         
House Account                                     
Attn: Cindy Tempesta                              
333 W. 34th St., 3rd Floor                        
               New York, NY 10001-2402                      5,122,633      6.39%

First Clearing, LLC                               
Special Custody Acct For The                      
Exclusive Benefit Of Customer                     
2801 Market St.                                   
               Saint Louis, MO 63103-2523                   7,539,106      9.40%

MLPF&S                                            
For The Sole Benefit of Its                       
Customers                                         
Attn: Fund Admin                                  
4800 Deer Lake Dr., East 2nd Floor                
               Jacksonville, FL 32246-6484                 20,779,885     25.91%

Morgan Stanley Smith Barney                       
Harborside Financial Center                       
Plaza II, 3rd Floor                               
               Jersey City, NJ 07311                        6,140,018      7.66%

National Financial Services LLC                   
For the Exclusive Benefit of our                  
Customers                                         
Attn: Mutual Funds Dept                           
200 Liberty St., 5th Floor                        
One World Financial Center                        
               New York, NY 10281-5503                      6,271,077      7.82%

Pershing LLC                                      
P.O. Box 2052                                     
               Jersey City, NJ 07303-2052                   6,446,022      8.04%

High Income    Citigroup Global Markets                                         
House Account                                     
Attn: Cindy Tempesta                              
333 W. 34th St., 3rd Floor                        
               New York, NY 10001-2402                      9,678,878     14.97%

First Clearing, LLC                               
Special Custody Acct For The                      
Exclusive Benefit Of Customer                     
2801 Market St.                                   
               Saint Louis, MO  63103-2523                  7,674,595     11.87%

MLPF&S                                            
For The Sole Benefit Of Its                       
Customers                                         
Attn: Fund Admin                                  
4800 Deer Lake Dr., East 2nd Floor                
               Jacksonville, FL 32246-6484                 15,879,626     24.56%

Morgan Stanley Smith Barney                       
Harborside Financial Center                       
Plaza II, 3rd Floor                               
               Jersey City, NJ 07311                        3,462,746      5.36%

Pershing LLC                                      
P.O. Box 2052                                     
               Jersey City, NJ  07303-2052                  4,618,374      7.14%

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                                                                    % of
Advisor                                                Number of        Advisor 
Class                                                  Advisor          Class   
Shares Fund    Name and Address                        Class Shares     Shares  
-----------    ----------------                        --------------   ------- 

Intermediate   CollegeBound Fund                                                
Bond           CBF- Quality Bond Fund                                           
Customized Allocation 529 Plan                    
1345 Avenue of the Americas                       
               New York, NY 10105-0302                      6,658,053     82.00%

MLPF&S                                            
For The Sole Benefit of Its                       
Customers                                         
Attn: Fund Admin                                  
4800 Deer Lake Dr., East 2nd Floor                
               Jacksonville, FL 32246-6484                  1,022,618     12.59%

Unconstrained  NFS LLC FEBO                                                     
Bond           Bank of America NA                                               
Cookson Amer Pension-SSGA                         
P.O. Box 831575                                   
               Dallas, TX 75283-1575                          239,687      5.45%

Pershing LLC                                      
P.O. Box 2052                                     
               Jersey City, NJ 07303-2052                     378,318      8.61%

RAM Trust Services                                
45 Exchange St.                                   
               Portland, ME 04101-5033                        342,751      7.80%

Sanford Bernstein & Co. LLC                       
1 N. Lexington Ave.                               
               White Plains, NY 10601-1712                  2,892,365     65.80%

Global Bond    Citigroup Global Markets                                         
House Account                                     
Attn: Cindy Tempesta                              
333 W. 34th St., 3rd Floor                        
               New York, NY 10001-2402                      7,115,500     12.51%

First Clearing LLC                                
Special Custody Acct for the                      
Exclusive Benefit of Customer                     
2801 Market St.                                   
               Saint Louis, MO 63103-2523                  10,420,798     18.32%

MLPF&S For The Sole Benefit of Its                
Customers                                         
Attn: Fund Admin                                  
4800 Deer Lake Dr., East 2nd Floor                
               Jacksonville, FL 32246-6484                 22,540,412     39.64%

High Income    Citigroup Global Markets                                         
House Account                                     
Attn: Cindy Tempesta                              
333 W. 34th St., 3rd Floor                        
               New York, NY 10001-2402                      8,657,226     17.36%

First Clearing, LLC                               
Special Custody Acct for the                      
Exclusive Benefit of Customer                     
2801 Market St.                                   
               Saint Louis, MO 63103-2523                  10,335,156     20.72%

LPL Financial                                     
FBO Customer Accounts                             
Attn: Mutual Fund Operations                      
P.O. Box 509046                                   
               San Diego, CA 92150-9046                     2,570,864      5.15%

MLPF&S                                            
For The Sole Benefit of Its                       
Customers                                         
Attn: Fund Admin                                  
4800 Deer Lake Dr., East 2nd Floor                
               Jacksonville, FL 32246-6484                 14,787,746     29.65%

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                                                                    % of
Class R                                                Number of        Class R 
Shares Fund    Name and Address                        Class R Shares   Shares  
-----------    ----------------                        --------------   ------- 

Intermediate                                                                    
Bond           Counsel Trust DBA Mid Atlantic                                   
Trust Company FBO                                 
Trans World Gaming Corp                           
401 K Profit Sharing Plan & Trust                 
1251 Waterfront Place, Suite 525                  
               Pittsburgh, PA 15222-4228                        6,408      9.12%

Dennis R. Culler FBO                              
Wielgus Product Models Inc                        
401K PSP & Trust                                  
1435 W. Fulton St.                                
               Chicago, IL  60607-1109                          5,953      8.47%

Mark Doyle FBO                                    
Dolyle Chevrolet Inc                              
401K PSP & Trust                                  
740 Ridge Road                                    
               Webster, NY  14580-2449                          4,126      5.87%

MG Trust Company Cust                             
MRF S 401K Plan                                   
700 17th St., Suite 300                           
               Denver, CO 80202-3531                           11,575     16.48%

MLPF&S                                            
For The Sole Benefit of Its                       
Customers                                         
Attn: Fund Admin                                  
4800 Deer Lake Dr., East 2nd Floor                
               Jacksonville, FL 32246-6484                      6,738      9.59%

State Street Bank & Trust                         
FBO ADP/MSDW Alliance                             
Attn: Ralph Campbell                              
105 Rosemont Rd.                                  
               Westwood, MA 02090-2318                         20,395     29.03%

Unconstrained  ING                                                              
Bond           Enhanced K-Choice                                                
Trustee: Reliance Trust Company                   
400 Atrium Drive                                  
               Somerset, NJ 08873-4162                         17,757     27.73%

MG Trust Company Trustee                          
Sanger & Eby Design                               
PS & 401K Pl                                      
700 17th St., Suite 300                           
               Denver, CO 80202-3531                           18,466     28.84%

State Street Bank & Trust                         
FBO ADP/MSDW Alliance                             
Attn: Ralph Campbell                              
105 Rosemont Rd.                                  
               Westwood, MA 02090-2318                         19,771     30.88%

Global Bond    State Street Corporation TTEE                                    
C/F ADP Access                                    
1 Lincoln St.                                     
               Boston, MA 02111-2901                        1,124,040     61.22%

High Income    ING                                                              
Enhanced K-Choice                                 
Trustee: Reliance Trust Company                   
400 Atrium Drive                                  
               Somerset, NJ 08873-4162                        213,167     13.81%

MLPF&S                                            
For The Sole Benefit of Its                       
Customers                                         
Attn: Fund Admin                                  
4800 Deer Lake Dr., East 2nd Floor                
               Jacksonville, FL 32246-6484                    281,634     18.25%

NFS LLC FEBO                                      
Reliance Trustco Trustee Custodian                
TR FBO Various Ret Plans                          
1150 S. Olive St.                                 
               Los Angeles, CA 90015-2211                     135,673      8.79%

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                                                                    % of
Class K                                                Number of        Class K 
Shares Fund    Name and Address                        Class K Shares   Shares  
-----------    ----------------                        --------------   ------- 

Intermediate   Orchard Trust Co. LLC TTEE Cust                                  
Bond           Crystal Steel 401 K Plan                                         
8515 E. Orchard Rd. 2T2                           
               Greenwood Village, CO 80111-5002                25,978      7.59%

Orchard Trust Co. LLC TTEE Cust                   
Minnesota Surgical Associates PA                  
8515 E. Orchard Rd. 2T2                           
               Greenwood Village, CO 80111-5002               124,015     36.22%

Orchard Trust Co. LLC TTEE Cust                   
Muncie Surgical Associates Inc. PSP               
8515 E. Orchard Rd. 2T2                           
               Greenwood Village, CO 80111-5002               105,053     30.68%

Orchard Trust Co. LLC TTEE Cust                   
FBO TAP Electric Contracting Corp                 
401(K) Retirement Plan                            
8515 E. Orchard Rd. 2T2                           
               Greenwood Village, CO 80111-5002                25,678      7.50%

Orchard Trust Co. LLC TTEE Cust                   
Shore Heart Group PA                              
401 K Profit Sharing Plan                         
8515 E. Orchard Rd. 2T2                           
               Greenwood Village, CO 80111-5002                21,688      6.33%

Unconstrained  AllianceBernstein L.P.                                           
Bond           Attn: Brent Mather-Seed Acct.                                    
1 N. Lexington Ave.                               
               White Plains, NY 10601-1712                      1,130      8.15%

Frontier Trust Co. C/F                            
Chelus Herdzik Speyer & Monte PC                  
P.O. Box 10758                                    
               Fargo, ND 58106-0758                             2,299     16.59%

Orchard Trust Co. LLC TTEE                        
FBO Stoner, Albright & Company                    
Retirement Plan                                   
8515 E. Orchard Rd. 2T2                           
               Greenwood Village, CO 80111-5002                10,386     74.95%

Global Bond    Orchard Trust Co. LLC TTEE                                       
Englewood Surgical Associates PA                  
8515 E. Orchard Rd. 2T2                           
               Greenwood Village, CO 80111-5002                10,460      7.23%

Orchard Trust Co. LLC TTEE                        
FBO Miami Diver Inc                               
401(K) PSP                                        
8515 E. Orchard Rd. 2T2                           
               Greenwood Village, CO 80111-5002                29,256     20.22%

Orchard Trust Co. LLC TTEE                        
FBO Stoner, Albright & Company                    
Retirement Plan                                   
8515 E. Orchard Rd. 2T2                           
               Greenwood Village, CO 80111-5002                44,761     30.94%

Orchard Trust Co. LLC TTEE                        
FBO The Office Furniture Warehouse                
8515 E. Orchard Rd. 2T2                           
               Greenwood Village, CO 80111-5002                19,212     13.28%

High Income    Joseph R. Burlin 401(K) Profit                                   
Sharing Plan                                      
1805 North Carolina St.                           
Suite 405                                         
               Stockton, CA 95204                              22,772     15.59%

Paper Source Inc.                                 
401K & Profit Sharing Plan                        
C/F Bill Saracco                                  
410 N. Milwaukee Ave.                             
               Chicago, IL 60654-5515                          13,944      9.55%

Orchard Trust Company LLC TEE Cust                
Chastang Enterprises Inc.                         
401K Pl                                           
8515 E. Orchard Rd. 2T2                           
               Greenwood Village, CO 80111                     12,003      8.22%

Orchard Trust Company LLC TTEE Cust               
Informa Fin Infor Inc. Def Comp Pl                
8515 E. Orchard Rd. 2T2                           
               Greenwood Village, CO 80111                     36,271     24.83%

Orchard Trust Company LLC TTEE Cust               
Palm Beach Heart Assoc. PA PSP                    
8515 E. Orchard Rd. 2T2                           
               Greenwood Village, CO 80111                      8,727      5.97%

Orchard Trust Company LLC TTEE Cust               
Valensi Rose & Magaram                            
8515 E. Orchard Rd. 2T2                           
               Greenwood Village, CO 80111                     29,807     20.40%

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                                                                    % of
Class I                                                Number of        Class I 
Shares Fund    Name and Address                        Class I Shares   Shares  
-----------    ----------------                        --------------   ------- 

Intermediate   NFS LLC FEBO                                                     
Bond           Midwest Trust Co                                                 
5901 College Boulevard                            
               Overland Park, KS 66211-1937                    22,227     20.92%

Orchard Trust Company LLC TTEE Cust               
Muskegon Surgical Associates PC                   
8515 E. Orchard Rd. 2T2                           
               Greenwood Village, CO 80111                     84,006     79.08%

Unconstrained  AllianceBernstein L.P.                                           
Bond           Attn: Brent Mather-Seed Acct.                                    
1 N. Lexington Ave.                               
               White Plains, NY 10601-1712                      1,130     99.99%

Global Bond    Attn: Mut Funds 11270 W. Park Pl                                 
NFS LLC FEBO                                      
Marshall & Ilsley Trust Co NA                     
FBO Bank Daily Recordkeeping                      
Ste. 400                                          
               Milwaukee, WI 53224                            181,608     15.39%

Comerica Bank Trustee Clark Hill                  
PLC Pension Plan                                  
P.O. Box 75000                                    
               Detroit, MI 48275                              163,276     13.84%

Converse College                                  
580 E. Main St.                                   
               Spartanburg, SC 29302-0006                     415,370     35.20%

NFS LLC FEBO                                      
Wings Financial Federal Credit Union              
Tim Keegan                                        
14985 Glazier Ave.                                
               Apple Valley, MN 55124-7484                    180,845     15.33%

High Income    MAC & Co                                                         
Attn: Mutual Fund OPS                             
P.O. Box 3198                                     
               Pittsburgh, PA 15230-3198                    1,739,148     82.12%

NFS LLC FEBO                                      
Huntington National Bank                          
7 Easton Oval                                     
               Columbus, OH 43219-6010                        156,899      7.41%

Custodians and Accounting Agents                                                
--------------------------------                                                

          State Street Bank and Trust Company ("State Street"), 225 Franklin
Street, Boston, Massachusetts 02110, acts as the custodian for the assets of    
Bond Fund but plays no part in deciding on the purchase or sale of portfolio    
securities. Subject to the supervision of each Fund's Directors, State Street   
may enter into subcustodial agreements for the holding of the Fund's foreign    
securities.                                                                     

          Brown Brothers Harriman & Co. ("Brown Brothers"), 40 Water Street,
Boston, Massachusetts 02109, acts as the custodian for the assets of            
Unconstrained Bond , Global Bond Fund and High Income Fund but plays no part in 
deciding the purchase or sale of portfolio securities. Subject to the           
supervision of each Fund's Directors, Brown Brothers may enter into subcustodial
agreements for the holding of the Fund's foreign securities.                    

Principal Underwriter                                                           
---------------------                                                           

           ABI, an indirect wholly-owned subsidiary of the Adviser, located at
1345 Avenue of the Americas, New York, New York 10105, is the principal         
underwriter of shares of the Funds, and as such may solicit orders from the     
public to purchase shares of the Funds. Under the Distribution Services         
Agreement, each Fund has agreed to indemnify ABI, in the absence of its willful 
misfeasance, bad faith, gross negligence or reckless disregard of its           
obligations thereunder, against certain civil liabilities, including liabilities
under the Securities Act.                                                       

Counsel                                                                         
-------                                                                         

        Legal matters in connection with the issuance of the shares of a
Fund offered hereby are passed upon by Seward & Kissel LLP, New York, New York. 

Independent Registered Public Accounting Firm                                   
---------------------------------------------                                   

        Ernst & Young LLP, 5 Times Square, New York, New York 10036, has
been appointed as the independent registered public accounting firm for the     
Funds.                                                                          

Additional Information                                                          
----------------------                                                          

            Shareholder inquiries may be directed to the shareholder's financial
intermediary or to ABIS at the address or telephone numbers shown on the front  
cover of this SAI. This SAI does not contain all the information set forth in   
the Registration Statement filed by a Fund with the Commission under the        
Securities Act. Copies of the Registration Statement may be obtained at a       
reasonable charge from the Securities and Exchange Commission or may be         
examined, without charge, at the offices of the Commission in Washington, D.C.  

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--------------------------------------------------------------------------------

FINANCIAL STATEMENTS AND REPORT OF INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM 

--------------------------------------------------------------------------------

            The financial statements of each of Intermediate Bond, Unconstrained
Bond and High Income for the fiscal year ended October 31, 2010 and the report  
of Ernst & Young LLP, the independent registered public accounting firm, are    
incorporated herein by reference to the each Fund's annual report. The annual   
reports were filed on Form N-CSR with the Commission on January 6, 2011. It is  
available without charge upon request by calling ABIS at (800) 227-4618 or on   
the Internet at www.AllianceBernstein.com.                                      

         The financial statements of Global Bond for the fiscal year ended
September 30, 2010 and the report of Ernst & Young LLP, independent registered  
public accounting firm, are incorporated herein by reference to the Fund's      
annual report. The Fund's annual report was filed on Form N-CSR with the        
Commission on December 6, 2010. The annual report is available without charge   
upon request by calling ABIS at (800) 227-4618 or on the Internet at            
www.AllianceBernstein.com.                                                      

SK 00250 0123 1144601a                                                          

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘497’ Filing		Date		First		Last			Other Filings
		12/31/12		50		126			NSAR-B
		1/31/12		9		83			485BPOS,  N-Q
		1/1/12		126
		10/31/11		124					24F-2NT,  N-CSR,  NSAR-B
		9/30/11		124
Filed on / Effective on:		2/4/11
		2/3/11		126
		1/31/11		2		122			485BPOS,  497K,  N-Q
		1/6/11		133					N-CSR
		1/4/11		124		126
		12/31/10		8		124
		12/16/10		124					DEFA14A
		12/6/10		133
		10/31/10		61		133			24F-2NT,  N-CSR,  NSAR-B
		9/30/10		45		133
		6/30/10		125					N-PX
		10/31/09		61		126			24F-2NT,  N-CSR,  NSAR-B
		9/30/09		124		126
		1/31/09		36		125			N-Q
		10/31/08		61		126			24F-2NT,  N-CSR,  NSAR-B
		9/30/08		61		126
		1/28/08		126					24F-2NT,  485BPOS
		11/5/07		126					497
		10/31/07		61		115			24F-2NT,  N-CSR,  NSAR-B
		2/1/06		126					485BPOS
		10/19/05		97
		6/30/05		125					N-PX
		10/15/04		40		125
		9/7/04		124
		1/1/04		124
		9/2/03		36		125
		3/31/03		126
		3/1/02		126					485BPOS
		9/11/01		125
		6/30/01		48		105
		7/1/99		124
		12/31/97		48		105
		9/22/97		48		105
		1/2/96		124
		2/1/94		124
		7/22/92		124
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