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As filed with the Securities and Exchange Commission on November 28, 2000
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO.)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement
[_] Definitive Proxy Statement
[X] Definitive Additional Materials
[_] Soliciting Material Under Rule 14a-12
[_] Confidential, For Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
MuniHoldings New Jersey Insured Fund, Inc.
P.O. Box 9011 Princeton, New Jersey 08543-9011
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(Name of Registrant as Specified In Its Charters)
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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(5) Total fee paid:
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[_] Fee paid previously with preliminary materials:
[_] 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 registration statement
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(1) Amount previously paid:
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MUNIHOLDINGS NEW JERSEY INSURED FUND, INC.
MUNIHOLDINGS NEW JERSEY INSURED FUND IV, INC.
Dear Stockholder:
You are being asked to consider a transaction involving the Funds listed
above. The transaction is a reorganization in which MuniHoldings New Jersey
Insured Fund, Inc. will acquire MuniHoldings New Jersey Insured Fund IV, Inc.
On December 13, 2000, each Fund will hold an Annual Meeting of Stockholders
at which the Reorganization will be considered. The Reorganization must be
approved by (1) the holders of Auction Market Preferred Stock of MuniHoldings
New Jersey Insured Fund, Inc. and (2) both the holders of Auction Market
Preferred Stock and the holders of Common Stock of MuniHoldings New Jersey
Insured Fund IV, Inc. A joint proxy statement and prospectus which provides
information about the proposed Reorganization and about each Fund was previously
mailed to you. A Question and Answer sheet that addresses frequently asked
questions is enclosed with this letter.
You are being asked to approve the Agreement and Plan of Reorganization
between the Funds pursuant to which MuniHoldings New Jersey Insured Fund, Inc.
will acquire substantially all of the assets and assume substantially all of the
liabilities of MuniHoldings New Jersey Insured Fund IV, Inc. in exchange for
newly issued shares of Common Stock and shares of a newly created series of
Auction Market Preferred Stock of MuniHoldings New Jersey Insured Fund, Inc. to
be designated Series E. These shares will be distributed by MuniHoldings New
Jersey Insured Fund IV, Inc. to its stockholders so that holders of its Common
Stock will receive Common Stock in MuniHoldings New Jersey Insured Fund, Inc.
and holders of its Auction Market Preferred Stock will receive Auction Market
Preferred Stock in MuniHoldings New Jersey Insured Fund, Inc. as described in
the joint proxy statement and prospectus.
The Board of Directors of each Fund has reviewed the proposed
Reorganization and recommends that you vote FOR the proposed Reorganization.
Sincerely,
Jodi M. Pinedo
Secretary
MuniHoldings New Jersey Insured Fund, Inc. and
Enclosure MuniHoldings New Jersey Insured Fund IV, Inc.
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In this Question and Answer Sheet, we will refer to MuniHoldings New Jersey
Insured Fund, Inc. as New Jersey Insured and MuniHoldings New Jersey Insured
Fund IV, Inc. as New Jersey Insured IV.
Q. Why am I receiving this proxy?
A. As a stockholder of New Jersey Insured or New Jersey Insured IV, you are
being asked to consider a transaction in which New Jersey Insured will
acquire substantially all the assets and assume substantially all the
liabilities of New Jersey Insured IV. This transaction is referred to in
this question and answer sheet as the Reorganization. The Reorganization
requires the approval of the holders of Auction Market Preferred Stock
("AMPS") of New Jersey Insured and the approval of the holders of Common
Stock and AMPS of New Jersey Insured IV.
Q. Who is receiving this proxy?
A. Those receiving this proxy are: (1) the holders of AMPS of New Jersey
Insured, (2) the holders of AMPS of New Jersey Insured IV, and (3) the
holders of Common Stock of New Jersey Insured IV. The Reorganization
requires the vote of these Stockholders. The Reorganization does not
require the vote of the holders of Common Stock of New Jersey Insured.
Q. Which Fund will be the Surviving Fund and which Fund will be the Acquired
Fund in the Reorganization?
A. New Jersey Insured will be the surviving fund (the "Surviving Fund") and
New Jersey Insured IV will be the acquired fund.
Q. Will the Reorganization change my privileges as a stockholder?
A. Your privileges as a stockholder will not change in any substantial way
as a result of the Reorganization. In addition, the stockholder services
available to you after the Reorganization will be substantially the same
as the stockholder services currently available to you.
Q. How will the Reorganization affect stockholders?
A. Stockholders should consider the following:
. After the Reorganization, each Fund's stockholders will be invested in
a fund with an increased level of net assets with substantially
similar investment objectives and policies.
. a lower anticipated aggregate operating expense ratio (the ratio of
operating expenses to total fund assets) than New Jersey Insured IV
prior to the Reorganization. The estimated costs of the
Reorganization, however, are expected to result in a reduction in net
asset value that is expected to be recovered after the Reorganization
because of the anticipated lower operating expense ratio.
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Q. If I own Common Stock of New Jersey Insured IV, will I own the same
number of shares of Common Stock of New Jersey Insured after the
Reorganization as I currently own?
A. No. You will receive Common Stock of New Jersey Insured with the same
aggregate net asset value as the Common Stock of New Jersey Insured IV 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 Stock of the Funds on that date.
For example, let us assume that you own 10 shares of Common Stock of New
Jersey Insured IV. If the net asset value of New Jersey Insured IV Common
Stock on the Valuation Date is $6 per share, and the net asset value of
the New Jersey Insured Common Stock on the Valuation Date is $12 per
share, you will receive 5 shares of New Jersey Insured Common Stock in
the Reorganization. The aggregate net asset value of your investment will
not change. (10 New Jersey Insured IV shares x $6 = $60; 5 New Jersey
Insured shares x $12 = $60).
Thus, if on the Valuation Date the net asset value of the Common Stock of
New Jersey Insured is higher than the net asset value of the Common Stock
of New Jersey Insured IV, you will receive fewer shares of Common Stock
of New Jersey Insured in the Reorganization than you held in New Jersey
Insured IV before the Reorganization. On the other hand, if the
net asset value of the Common Stock of New Jersey Insured is lower than
the net asset value of the Common Stock of New Jersey Insured IV, you
will receive a greater number of shares of New Jersey Insured Common
Stock in the Reorganization. The aggregate net asset value of your shares
after the Reorganization will be the same as before the Reorganization.
Q. I currently hold AMPS of New Jersey Insured IV. After the Reorganization,
what will I hold?
A. If prior to the Reorganization you After the Reorganization you will
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hold: hold:
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New Jersey Insured IV Series A AMPS New Jersey Insured Series E AMPS
You will receive shares of New Jersey Insured's Series E AMPS with the
same aggregate liquidation preference as the shares of AMPS of New Jersey
Insured IV that you currently hold. Since each share of AMPS of both
Funds has a $25,000 liquidation preference, the holders of AMPS of New
Jersey Insured IV will receive one share of New Jersey Insured Series E
AMPS for each share they currently hold. The auction and dividend payment
dates for the New Jersey Insured Series E AMPS that you will receive in
the Reorganization will be different from the auction and dividend
payment dates for the New Jersey Insured IV Series A AMPS. This will not
adversely affect the value of your investment.
Q. Should I send in my stock certificates now?
A. No. After the Reorganization is completed, we will send holders of Common
Stock of New Jersey Insured IV written instructions for exchanging their
stock certificates. New Jersey Insured IV stockholders should exchange
their stock certificates after the Reorganization promptly in order to
continue to receive dividend payments on their shares. Dividends declared
will accrue but payments will not be made until certificates for New
Jersey Insured IV Common Stock are surrendered and exchanged for stock
certificates of the Surviving Fund. Stockholders of New Jersey Insured
will keep their stock certificates.
Holders of AMPS will not be required to surrender their stock
certificates. All exchanges of AMPS will be accomplished by book entry.
Q. What are the tax consequences for stockholders?
A. The Reorganization is structured as a tax-free transaction so that the
completion of the Reorganization itself will not result in Federal income
tax liability for stockholders of either Fund, except for taxes on any
cash received for a fractional share of Common Stock. The Funds have
applied for a private letter ruling from the Internal Revenue Service
with respect to the tax treatment of the Reorganization.
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Q. Who will manage the Surviving Fund after the Reorganization?
A. Fund Asset Management L.P. serves as the investment adviser for the Funds
and will be the investment adviser of the Surviving Fund after the
Reorganization. The portfolio of New Jersey Insured is managed by Robert
D. Sneeden. The portfolio of New Jersey Insured IV is managed by Roberto
W. Roffo. After the Reorganization, the portfolio of the Surviving Fund
will be managed by Mr. Sneeden.
Q. Will there be a Stockholders' Meeting for each Fund?
A. Yes, an Annual Meeting of Stockholders for each Fund will be held on
December 13, 2000, at 800 Scudders Mill Road, Plainsboro, New Jersey at
the time specified below.
Fund Time
New Jersey Insured 12:00 noon
New Jersey Insured IV 12:30 p.m.
Q. Why is my vote important?
A. Approval of the Reorganization requires the affirmative vote of (i)
stockholders representing a majority of the outstanding shares of Common
Stock and AMPS of New Jersey Insured IV, voting together as a single
class, and a majority of the outstanding AMPS of New Jersey Insured IV,
voting as a separate class, and (ii) stockholders representing a majority
of the outstanding shares of New Jersey Insured AMPS, voting as a
separate class. For purposes of any vote, a quorum consists of one-third
of the shares of Common Stock and AMPS entitled to vote at the Meeting.
The Board of Directors of each Fund urges every stockholder 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. You may also vote your shares on the Internet at
http://www.proxyvote.com until 4:00 p.m. on December 12, 2000. Or refer
to the "800" number printed on your voting instruction form. On the
Internet you will be asked for a control number that you received in your
proxy mailing. You may also vote in person at the Annual Meeting of
Stockholders. 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.
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Q. Have the Funds retained a proxy solicitation firm?
A. Yes, each Fund has hired Shareholder Communications Corporation to assist
in the solicitation of proxies for the Meeting. While the Funds expect
most proxies to be returned by mail, the Funds may also 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 ensure 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 stockholders 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 an Annual
Meeting of Stockholders to achieve the necessary quorum, or if the
necessary quorum is present but there are not sufficient votes to approve
the proposal by the time of the Annual Meeting of Stockholders on
December 13, 2000, such Annual Meeting may be adjourned to permit further
solicitation of proxy votes.
Q. What is the Board's recommendation?
A. The Board of Directors of each Fund believes the Reorganization is in the
best interests of the Fund and its stockholders. It encourages
stockholders to vote FOR the Reorganization.
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