As filed with the Securities and Exchange Commission on November 12, 1999
SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed by the registrant |X|
Filed by a party other than the registrant |_|
Check the appropriate box:
|_| Preliminary proxy statement
[_] Confidential, For Use of the Com-
mission Only (as permitted by
Rule 14a-6(e)(2))
|_| Definitive proxy statement
|X| Definitive additional materials
|_| Soliciting material pursuant to Rule 14a-11(c) or Rule 14a-12
MUNIHOLDINGS FLORIDA INSURED FUND
MUNIHODLINGS FLORIDA INSURED FUND II
MUNIHOLDINGS FLORIDA INSURED FUND III
MUNIHOLDINGS FLORIDA INSURED FUND IV
P.O. Box 9011
Princeton, New Jersey 08543-9011
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(Name of Registrant as Specified in Its Charter)
Same as above
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(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of filing fee (Check the appropriate box):
|X| No fee required.
|_| Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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|_| Fee paid previously with preliminary materials.
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|_| Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registrations statement number, or
the form or schedule and the date of its filing.
(1) Amount previously paid:
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(4) Date Filed:
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MUNIHOLDINGS FLORIDA INSURED FUND
MUNIHOLDINGS FLORIDA INSURED FUND II
MUNIHOLDINGS FLORIDA INSURED FUND III
MUNIHOLDINGS FLORIDA INSURED FUND IV
Dear Shareholder:
You are being asked to consider a transaction involving your Fund and
the other Funds listed above. The transaction is a reorganization of similar
funds in which one Fund will acquire the other Funds. The following chart
outlines the reorganization structure.
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Surviving Fund Funds to be Acquired
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MuniHoldings Florida Insured Fund MuniHoldings Florida Insured Fund II
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MuniHoldings Florida Insured Fund III
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MuniHoldings Florida Insured Fund IV
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On December 15, 1999, each Fund will hold an Annual Shareholders'
Meeting to consider the Reorganization, which must be approved by the
shareholders of each Fund involved. A combined proxy statement and prospectus
that provides information about the proposed Reorganization and about each Fund
is enclosed along with a Question and Answer sheet that addresses frequently
asked questions. At the Annual Shareholders' Meeting you will also be asked to
elect Trustees and to ratify the selection of independent auditors. Information
about these proposals is also contained in the combined proxy statement and
prospectus.
You are being asked to approve the Agreement and Plan of Reorganization
among the Funds pursuant to which MuniHoldings Florida Insured Fund will acquire
the assets and assume the liabilities of each of the Acquired Funds in exchange
for newly issued Common Shares and Auction Market Preferred Shares of
MuniHoldings Florida Insured Fund. The Acquired Funds will distribute these
shares to their respective shareholders so that holders of Common Shares will
receive Common Shares of MuniHoldings Florida Insured Fund and holders of
Auction Market Preferred Shares will receive Auction Market Preferred Shares of
MuniHoldings Florida Insured Fund on the basis described in the combined proxy
statement and prospectus.
The Board of Trustees of each Fund has reviewed the Reorganization
proposal and recommends that you vote FOR the proposal after carefully
reviewing the enclosed materials. The Board of Trustees also recommends that
shareholders of the Funds vote for the Trustee nominees and for the
ratification of the selection of independent auditors of the Fund.
Your vote is important. Please take a moment now to sign and return
your proxy card in the enclosed postage paid return envelope. You may also vote
on the internet by visiting http://www.proxyvote.com and entering the 12 digit
control number located on your proxy card. If we do not hear from you after a
reasonable amount of time, you may receive a telephone call from our proxy
solicitor, Shareholder Communications Corporation, reminding you to vote your
shares.
Sincerely,
Alice A. Pellegrino
Secretary of MuniHoldings Florida
Insured Fund III
William E. Zitelli, Jr.
Secretary of MuniHoldings Florida
Insured Fund, Muniholdings Florida Insured Fund II and
MuniHoldings Florida Insured Fund IV
Enclosures
<PAGE>
MUNIHOLDINGS FLORIDA INSURED FUND
MUNIHOLDINGS FLORIDA INSURED FUND II
MUNIHOLDINGS FLORIDA INSURED FUND III
MUNIHOLDINGS FLORIDA INSURED FUND IV
Q. Why am I receiving this proxy material?
A. As a shareholder of one of the Funds, you are being asked to consider
the Reorganization of the Funds. The transaction requires the approval
of each Fund's shareholders.
Q. Will the Reorganization change my rights and privileges as a
shareholder?
A. Your rights and privileges as a shareholder will not change in any
substantial way as a result of the Reorganization. In addition, the
shareholder services available to you after the Reorganization will be
substantially the same as the shareholder services currently available
to you.
Q. How will the Reorganization benefit me and other shareholders?
A. Shareholders should consider the following:
o After the Reorganization, the Fund's shareholders will be invested
in a fund with an increased level of net assets with substantially
similar investment objectives and policies:
o After the Reorganization, holders of Common Shares are expected to
experience:
q o a lower aggregate operating expense ratio (the ratio of
operating expenses to total fund assets) than any individual
Fund prior to the Reorganization;
o a Fund with greater efficiency and flexibility in its
portfolio management; and
o a more liquid public trading market for Common Shares.
Q. Will the Reorganization affect the value of my investment?
A. The value of your investment will not change.
Q. After the Reorganization, will I own the same number of Common Shares
as I currently own?
A. Yes, if you currently own Common Shares of MuniHoldings Florida Insured
Fund. You will not receive any additional Common Shares and the number
of shares that you own after the Reorganization will be the same as the
number of Common Shares that you currently own.
<PAGE>
No, if you currently own Common Shares in one of the Acquired Funds.
You will receive Common Shares of MuniHoldings Florida Insured Fund
with the same aggregate net asset value as the Common Shares of the
Acquired Fund you currently own on the business day prior to the
closing date of the Reorganization (the "Valuation Date"). The number
of shares you receive will depend on the relative net asset values of
the Common Shares of the Funds on that date. For example, suppose that
you own 10 Common Shares of an Acquired Fund. If the net asset value of
the Acquired Fund's Common Shares on the Valuation Date is $6 per
share, and the net asset value of MuniHoldings Florida Insured Fund's
Common Shares is $12 per share, you will receive 5 MuniHoldings Florida
Insured Fund Common Shares in the Reorganization. The aggregate net
asset value of your investment will not change. (10 Acquired Fund
shares x $6 = $60; 5 MuniHoldings Florida Insured Fund shares x $12 =
$60).
Q. I currently hold Auction Market Preferred Shares of one of the Funds.
After the Reorganization, what will I hold?
<TABLE>
<CAPTION>
A. If Prior to the Reorganization you hold: After the Reorganization you will hold:
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<S> <C>
MuniHoldings Florida Insured Fund: MuniHoldings Florida Insured Fund:
Series A AMPS Series A AMPS
Series B AMPS Series B AMPS
MuniHoldings Florida Insured Fund II:
Series A AMPS Series C AMPS
Series B AMPS Series C AMPS
MuniHoldings Florida Insured Fund III:
Series A AMPS Series D AMPS
Series B AMPS Series D AMPS
MuniHoldings Florida Insured Fund IV:
Series A AMPS Series E AMPS
Series B AMPS Series E AMPS
</TABLE>
You will receive MuniHoldings Florida Insured Fund AMPS with the same
aggregate liquidation preference as the AMPS of the Acquired Fund you
currently hold. Since all of the AMPS have a $25,000 liquidation
preference the holders of AMPS of an Acquired Fund will receive one
share of AMPS of MuniHoldings Florida Insured Fund for each share of
AMPS they currently hold. The auction and dividend payment dates for
the AMPS you receive may be different from the auction and dividend
payment dates of the AMPS you currently hold. The first dividend period
following the Reorganization will be a special dividend period, which
may be either longer or shorter than your Fund's regular dividend
period. However, this will not adversely effect the value of your
investment.
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<PAGE>
Q. Should I send in my stock certificates now?
A. No. After the Reorganization is approved by each Fund's shareholders
and is completed, we will send holders of Common Shares of the Acquired
Funds written instructions for exchanging their share certificates.
Since holders of Auction Market Preferred Shares do not hold share
certificates, all exchanges of Auction Market Preferred Shares will be
accomplished by book entry. Shareholders of MuniHoldings Florida
Insured Fund will keep their share certificates.
Q. What are the tax consequences for me and other shareholders?
A. The Reorganization is structured as a tax-free transaction so that the
consummation of the Reorganization itself will not result in Federal
income tax liability for shareholders of any Fund, except that common
shareholders may incur taxes on any cash received for fractional Common
Shares. The Funds have applied for a private letter ruling from the
Internal Revenue Service on the tax-free treatment of the
Reorganization.
Q. Who will manage the combined fund after the Reorganization?
A. Fund Asset Management, L.P. currently serves as the manager for the
Funds and after the Reorganization will be the manager of MuniHoldings
Florida Insured Fund. Robert A. DiMella and Robert D. Sneeden currently
serve as the portfolio managers of all of the Funds, and they will be
the portfolio managers of MuniHoldings Florida Insured Fund after the
Reorganization.
Q. What will the name of the combined fund be after the Reorganization?
A. If the Reorganization is approved by each Fund's shareholders, the
combined fund's name will be MuniHoldings Florida Insured Fund.
Q. Where and when do I vote?
A. A shareholders' meeting for each Fund is scheduled for December 15,
1999, at 800 Scudders Mill Road, Plainsboro, New Jersey at the time
specified below for your Fund:
Fund Time
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MuniHoldings Florida Insured Fund 9:45 a.m.
MuniHoldings Florida Insured Fund II 10:00 a.m.
MuniHoldings Florida Insured Fund III 10:15 a.m.
MuniHoldings Florida Insured Fund IV 10:30 a.m.
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<PAGE>
Q. Why is my vote important?
A. For a quorum to be present at the Shareholders' Meeting, a majority of
the outstanding shares of each class of the Fund's shares must be
represented either in person or by proxy. Approval of the
Reorganization requires the affirmative vote of Fund shareholders
representing a majority of the outstanding Common Shares and AMPS,
voting together as a single class, and a majority of the outstanding
AMPS voting together as a separate class. The Board of Trustees urges
every shareholder to vote. Please read all proxy materials thoroughly
before casting your vote.
Q. How can I vote?
A. You may vote by signing and returning your proxy card in the enclosed
postage-paid envelope. Or you may vote your shares on the internet at
http://www.proxyvote.com. If you cast your vote over the internet, you
will be asked for the 12-digit control number located on your proxy
card. Or you may vote using the toll-free telephone number printed on
your voting instruction form. You may also vote in person at the
Shareholders' Meeting. If you submitted a proxy by mail, by telephone
or on the internet, you may withdraw it at the Meeting and then vote in
person at the Meeting or you may submit a superseding proxy by mail, by
telephone or on the internet.
Q. Has the Fund retained a proxy solicitation firm?
A. Yes, the Fund has hired Shareholder Communications Corporation to
assist in the solicitation of proxies for the Meetings. While the Fund
expects most proxies to be returned by mail, it also may solicit
proxies by telephone, fax, telegraph or personal interview.
Q. What if there are not enough votes to reach a quorum by the scheduled
meeting date?
A. In order to insure that we receive enough votes, we may need to take
further action. We or our proxy solicitation firm may contact you by
mail or telephone. Therefore, we encourage shareholders to vote as soon
as they review the enclosed proxy materials to avoid additional
mailings or telephone calls. If enough shares are not represented at
the Meetings for a quorum or a quorum is present but there are not
sufficient votes to approve the proposal by the time of each
Shareholder's Meeting on December 15, 1999, then one or more of the
Meetings may be adjourned to permit further solicitation of proxy
votes.
Q. What is the Board's recommendation on the Reorganization proposal?
A. The Board of Trustees of each Fund believes the Reorganization is in
the best interests of the Fund's shareholders. Your Board of Trustees
encourages you to vote FOR the Reorganization.
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