Zweig Fund And Zweig Total Return Fund Announce Increases To Distribution Rates

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Apr 01, 2016, 03:24 ET

NEW YORK, April 1, 2016 /PRNewswire/ -- The Boards of Directors of The Zweig Fund, Inc. (NYSE: ZF) and The Zweig Total Return Fund, Inc. (NYSE: ZTR) today announced that each fund has approved an increase in the annualized distribution rate to 10 percent of the fund's net asset value (NAV). Each fund will implement enhancements to its investment strategies that are intended to increase the amount of income available for distribution to shareholders.

The new 10 percent annualized distribution rate represents a 67 percent increase for the Zweig Fund and a 43 percent increase for the Zweig Total Return Fund and will be paid as follows:

Amount

Per Share

Record Date

Ex Date

Payable Date

ZF (Quarterly)

$0.362

April 11, 2016

April 7, 2016

April 18, 2016

ZTR (Monthly)

$0.112

April 11, 2016

April 7, 2016

April 18, 2016

Zweig Advisers, the investment adviser to the funds, will introduce an options overlay strategy to each fund's existing investment strategy. The overlay strategy involves purchasing and selling put and call options with the objective of generating additional income from option premiums while seeking to limit potential losses. The adviser also intends to increase the opportunistic use of leverage that each fund is permitted to incur, consistent with its investment restrictions.

Management and the Boards believe these distribution rates are appropriate at this time and consistent with each fund's investment objective. The Boards will continue to assess the level of distributions, giving consideration to evolving market conditions and other relevant factors.

Section 19(a) notice: ZF

The following chart discloses information on the sources of the quarterly distribution from the Zweig Fund (ZF):

Distribution Estimates	March 2016 (QTD)		Year-to-date (YTD) ⁽¹⁾
(Sources)	Per Share Amount	Percentage of Current Distribution	Per Share Amount	Percentage of Current Distribution
Net Investment Income	$ 0.035	9.8%	$ 0.035	9.8%
Net Realized Foreign Currency Gains	-	0.0%	-	0.0%
Net Realized Short-Term Capital Gains	-	0.0%	-	0.0%
Net Realized Long-Term Capital Gains	-	0.0%	-	0.0%
Return of Capital (or other Capital Source)	0.327	90.2%	0.327	90.2%
Total Distribution	$ 0.362	100.0%	$ 0.362	100.0%
(1) The distribution paid on January 11, 2016 was reportable in 2015 for federal income tax purposes and any distributions paid from January 12, 2016 to January 10, 2017 will be reportable for 2016 federal income tax purposes.

You should not draw any conclusions about ZF's investment performance from the amount of this distribution or from the terms of ZF's managed distribution plan. ZF estimates that it has distributed more than its income and net realized capital gains in the fiscal year to date; therefore, a portion of the distribution may be a return of capital. A return of capital may occur, for example, when some or all of the money that you invested in the fund is paid back to you. A return of capital distribution does not necessarily reflect the fund's investment performance and should not be confused with "yield" or "income."

The amounts and sources of distributions reported in this notice are only estimates and are not being provided for tax reporting purposes. The actual amounts and sources of the amounts for tax reporting purposes will depend upon the fund's investment experience during the remainder of its fiscal year and may be subject to changes based on tax regulations. The fund will send shareholders a Form 1099-DIV for the calendar year that will tell you how to report these distributions for federal income tax purposes.

Information regarding the fund's performance and distribution rates is set forth below. Please note that all performance figures are based on the fund's NAV and not the market price of the fund's shares. Performance figures are not meant to represent individual shareholder performance.

As of March 31, 2016
Five-Year Average Annual Total Return on NAV⁽¹⁾	6.3%
Current Fiscal YTD Annualized Distribution Rate ⁽²⁾	10.0%
YTD Cumulative Total Return on NAV ⁽³⁾	-2.0%
YTD Cumulative Distribution Rate ⁽⁴⁾	2.5%
(1) Average Annual Total Return on NAV is the annual compound return for the five-year period. It reflects the change in the fund's NAV and reinvestment of all distributions.
(2) Current Fiscal YTD Annualized Distribution Rate is the cumulative distribution rate annualized as a percentage of the fund's NAV at quarter-end.
(3) YTD Cumulative Total Return on NAV is the percentage change in the fund's NAV from the first day of the year to this quarter end, including distributions paid and assuming reinvestment of those distributions.
(4) YTD Cumulative Distribution Rate is the dollar value of distributions from the first day of the year to this quarter end, expressed as a percentage of the fund's NAV at quarter-end.

Section 19(a) notice: ZTR

The following chart discloses information on the sources of the monthly distribution from the Zweig Total Return Fund (ZTR):

Distribution Estimates	March 2016 (MTD)		Year-to-date (YTD) ⁽¹⁾
(Sources)	Per Share Amount	Percentage of Current Distribution	Per Share Amount	Percentage of Current Distribution
Net Investment Income	$ 0.014	12.2%	$ 0.044	16.8%
Net Realized Foreign Currency Gains	-	0.0%	-	0.0%
Net Realized Short-Term Capital Gains	-	0.0%	-	0.0%
Net Realized Long-Term Capital Gains	-	0.0%	-	0.0%
Return of Capital (or other Capital Source)	0.098	87.8%	0.220	83.2%
Total Distribution	$ 0.112	100.0%	$ 0.264	100.0%
(1) The distribution paid on January 11, 2016 was reportable in 2015 for federal income tax purposes and any distributions paid from January 12, 2016 to January 10, 2017 will be reportable for 2016 federal income tax purposes.

You should not draw any conclusions about ZTR's investment performance from the amount of this distribution or from the terms of ZTR's managed distribution plan. ZTR estimates that it has distributed more than its income and net realized capital gains in the fiscal year to date; therefore, a portion of the distribution may be a return of capital. A return of capital may occur, for example, when some or all of the money that you invested in the fund is paid back to you. A return of capital distribution does not necessarily reflect the fund's investment performance and should not be confused with "yield" or "income."

As of March 31, 2016
Five-Year Average Annual Total Return on NAV ⁽¹⁾	5.8%
Current Fiscal YTD Annualized Distribution Rate ⁽²⁾	9.5%
YTD Cumulative Total Return on NAV ⁽³⁾	0.3%
YTD Cumulative Distribution Rate ⁽⁴⁾	2.0%
(1) Average Annual Total Return on NAV is the annual compound return for the five-year period. It reflects the change in the fund's NAV and reinvestment of all distributions.
(2) Current Fiscal YTD Annualized Distribution Rate is the cumulative distribution rate annualized as a percentage of the fund's NAV at month end.
(3) YTD Cumulative Total Return on NAV is the percentage change in the fund's NAV from the first day of the year to this month end, including distributions paid and assuming reinvestment of those distributions.
(4) YTD Cumulative Distribution Rate is the dollar value of distributions from the first day of the year to this month end, expressed as a percentage of the fund's NAV at month end.

About the Funds

The Zweig Fund, Inc. (NYSE: ZF) and The Zweig Total Return Fund, Inc. (NYSE: ZTR) are closed-end funds advised by Zweig Advisers LLC. For more information on the funds, please contact Shareholder Services at (800) 272-2700, by email at [email protected], or visit us on the web at virtus.com.

Fund Risks

An investment in a fund is subject to risk, including the risk of possible loss of principal. The fund's shares may be worth less upon their sale than what an investor paid for them. The options overlay strategy may not be successful in achieving its objective of increasing distributable income while limiting the risk of loss and could result in increased losses for investors. An increased use of leverage may lead to increased volatility in the fund's NAV and share price, and could amplify the fund's level of gains or losses.

Forward-Looking Information

This press release contains statements that are, or may be considered to be, forward-looking statements. All statements that are not historical facts, including statements about beliefs or expectations, are "forward-looking statements" within the meaning of The Private Securities Litigation Reform Act of 1995. These statements may be identified by such forward-looking terminology as "expect," "estimate," "plan," "intend," "believe," "anticipate," "may," "will," "should," "could," "continue," "project," or similar statements or variations of such terms. Forward-looking statements are based on a series of expectations, assumptions, and projections; are not guarantees of future results or performance; and may involve risks and uncertainty. All forward-looking statements are as of the date of this release only; the funds undertake no obligation to update or review any forward-looking statements. The funds can give no assurance that such expectations or forward-looking statements will prove to be correct. Actual results may differ materially. You are urged to carefully consider all such factors.

SOURCE Zweig Advisers LLC